Yandex.Market and Sberbank want to create a Russian Amazon. What are the chances of the project

Yandex and Sberbank announced a deal: they create a joint venture based on Yandex.Market, a huge online hypermarket with their warehouses. Now the Market will no longer direct us to the sites of other stores, receiving a commission. Instead, it will start working on the Amazon scheme. The best-selling products will be stored at home, and instead of developing other people's resources, all sales transactions will be within the same site. They say such a radical change in the business model is associated with excessive competition from foreign online stores.

The joint project of Sberbank and Yandex is estimated at 60 billion rubles ($ 1 billion). The figure is very impressive: in 2013, even before the ruble fell, Yandex itself paid $ 80 million for Kinopoisk, and Durov received $ 300 million for Vkontakte. In addition, Yandex.Market is one of popular resources Runet, with an audience of more than 20 million people per month. But can the new platform do the same for us that Amazon did in the US, where it accounts for more than 50% of online purchases?

At , we work very closely with Amazon, delivering from it the lion’s share of your packages to Russia. And we have serious doubts about the new idea of ​​Grishakov and Gref. Still, Amazon is a very open and independent organization that does what it wants without looking at anyone. The connection of Yandex with Sberbank (and before that with the Post of Russia) makes the work of the service more stable, but will prevent it from developing faster than the rest of the market.

On the other hand, Russian online stores are going through hard times. Amazon and AliExpress are getting more and more popular. Thanks to the scheme of their work, they can offer the same goods, only one and a half times cheaper. A fundamental change in the work of Yandex.Market under such conditions may be the only correct option ...


Sberbank and Yandex already had one joint project - in 2012 the bank bought 75% of the Yandex.Money payment system for $ 60 million. Last year, Yandex.Market took shape as a separate company. The experts then said that this was due to the desire to attract individual investments for the site and to accelerate the pace of its development. And the management itself said that, as part of Yandex, the trade division made decisions too slowly, and so the team will have responsibility and focus on the result.

At the same time, Yandex.Market began to rebuild the model of its work. If earlier the aggregator took a commission for transitions to the sites of other stores, now - only for the purchase made from them (2% of the amount). Of the 20,000 stores, 5,000 have chosen the new payment model. Maxim Grishakov, the head of Yandex.Market, spoke about the idea of ​​turning their site into a huge online store. According to him, at the expense of large volumes, you can begin to lower prices, like Amazon. The company began to look for warehouses in Moscow and the Moscow Region where it would be possible to store a stock of the most demanded goods.

Maxim Grishakov, the new head of Yandex.Market from May 2017

In January 2017, there were rumors that Sberbank was thinking about creating a joint company with China AliExpress - to "become one of the world's largest e-commerce sites." Yandex did not like this sharply. In the annual report, the company called this potential transaction one of the most serious risks to its business.

In May, Yandex launched a beta test of its voice assistant, Alice (which even has a name like Amazon’s from Amazon). And in July, she said that she had been developing a smart home column for a year, which should compete with Amazon Echo (and even have a competitive advantage: the ability to respond to Russian speech). David Yang, the founder of ABBYY, commented on this news:
The task of all these devices is to ensure that Internet companies are maximally present in a person’s life. All these additional contacts in one way or another turn into extra money. Even when the user finds out the weather for tomorrow through the column, this creates loyalty to the service. “Yandex” is extremely important to take the market, until Google or Amazon columns come out here, in order not to lose another big piece, as happened with smartphones and mobile Internet.

Thanks to a new deal with Sberbank of Russia, Yandex is taking the biggest step towards switching to the Amazon model. With almost unlimited finances and an extensive network of branches throughout the country.

What now

After the deal with Yandex, Sberbank’s negotiations on establishing a joint venture with AliExpress will most likely be suspended. Still, the priority of Sberbank is to invest in the Russian economy, Russian companies.

Vladimir Bespalov, an analyst at VTB Capital, said in an interview with RBC :
While in the e-commerce market there is no clear leader. As Yandex itself recently stated, they have a strategy to move towards the “Russian Amazon”. Now they will have a powerful partner in the person of Sberbank, with whom they can share these risks, including investment risks.

The transaction is finally closed after the investment check of Yandex.Market and the receipt of all necessary permits. This should happen before the end of 2017. In the meantime, Yandex is switching to a transactional model. Chooses warehouses, builds a logistics and delivery system. He does everything so that he does not need to go beyond the “Market”: both the goods and the method of their sending can be chosen on the site itself.

The project manager, Maxim Grishakov, admits that it will be difficult to lure large stores to the new site:
They want the buyer to come only to them, and they are reluctant to share traffic. Amazon in America also does not work with the largest retailers, because the latter are trying to do something themselves. We will deal with this by expanding the range of products. And Sberbank technologies will improve the payment process and offer the purchase of goods on credit.

In addition, as experts say, Yandex will be able to use the administrative resource and a massive network of Sberbank branches to issue Internet orders or to run ads. It will be an organic outlet of the Internet giant in offline retail, which is still the first in popularity in our country. Only with such promotion, Yandex.Market has prospects to become number one, like Amazon in Europe and America. Now it is the third online trading platform in Russia - after Avito and AliExpress, but together with Sberbank it can compete for the first line.

Why Yandex.Market does not become an Amazon

In 1998, Stephen Jobs told Fortune in an interview: “As a child, the guy from the next street had a Volkswagen Beetle. He dreamed of making him a Porsche. The boy spent all his time and money on accessories for the car, so that it looked better and sounded more powerful. But when he finished, he had no Porsche. It was just a loud, ugly Volkswagen Beetle. ”

The chances of Yandex.Market to become Porsche are small. This is a matter of facts and statistics. The new company “Yandex” and “Sberbank” is estimated at 60 billion rubles ($ 1 billion). Amazon costs at least $ 500 billion. When it inevitably goes to Russia, it will be almost impossible to compete with its prices and its big data. The monthly audience of Yandex.Market is 20 million users, Amazon has at least 150 million (and this is only in America). It will also be extremely difficult for Yandex who has learned to buy abroad to lure back: prices in Russia will always be higher than in the competitive markets of China and the United States, where there are no excess taxes.

But these are the things that are in plain sight. And there are pitfalls. The head of InterMonte agency Alexey Bozhin told in some detail why the business model borrowed from the business model is not suitable for Russian realities. And we, based on eight years of work experience with Amazon, have added a couple of our reasons to its reasons:

1. The difficulties of logistics .

Warehouses are known to play a key role in sales. Amazon pays special attention to them: it builds its largest warehouses in the world, populates robots in them, scans goods, trains its employees, gives them super-tech “guns” checking every sneeze. Realizing that the size and location of the warehouse is the main potential advantage of an online store, Amazon spends a lot of money, hundreds of millions of dollars trying to develop airship warehouses or hive warehouses, from which delivery would be carried out a little faster.

One of the Amazon warehouses

There is not enough free space for Yandex.Market, and the platform can hardly make a quick delivery with its trump card in the first six months or a year. In order not to be an outsider and not to lose to small shops scattered in different districts of cities, the company will have to invest millions, and not rubles. Sberbank money will start to leave very quickly. This is evidenced by the head of the Association of Online Trading Companies (AKIT) Alexey Fedorov:
Everyone wants to become an Amazon. But this will require huge investments from Yandex - its warehouses, many names. So already works, for example, Ozon. He has huge investments in his own logistics infrastructure and so on. And the company is still unprofitable.

2. The need to gain customer confidence

For an online hypermarket, this is just as important as low prices. It is necessary that people like you, that they recommend you to their friends. Live communication with customers, in the opinion of Bozhin, is far from the point of Yandex. The company will have to create call centers from scratch to deal with customer questions and take orders. Amazon, for example, has 35,000 people at call centers - five times more than the total number of employees at Yandex. Logistics, the availability of warehouses and training of employees - some problems. There are two options: either “Market” waits for a couple of years, prepares the base, and during this time gives the Russian market to AliExpress with Avito, or it hurries, starts the service next year, and gets a bump of negative feedback about the speed and quality of its work.

3. Lack of innovation

It is not enough to become the best, it is important to fix yourself on # 1. Amazon does this by investing in the future. Creates his own robots, delivery by drones, shops without cashiers, airships, a fleet of 40 aircraft, "hives-warehouses" in cities. The company is always at the turn, on the horizon. “Market” does not have so many extra billions to invest in unique new developments, in scientists who make scientific breakthroughs. And that means that it will be just “another shop,” even if it is slightly larger or slightly more famous than the rest. Go to another league, as did Amazon, he is unlikely to succeed. Sberbank and Pochta Rossii, whose support has been enlisted by Yandex.Market, have recently shown progress, but are still more associated with our past, rather than with our future.

Amazon Robots

4. Confrontation from the "partner shops"

Yandex will have to fight against its own customers - stores that want to sell products through their website. Amazon and AliExpress have not come across this: they have never led to the sites of other stores, all sales take place on their personal portal.

Now Yandex.Market does not just want to be another traffic channel. He wants to become a hypermarket where merchants will sell their goods. It will be very difficult to convince experienced store owners to hand over the reins to Yandex. The stores with the highest turnover two years ago, in preparation for such a scenario, began to reduce their dependence on the site. And from here - the drop in profits and a reduction in the range, which is already being observed. People will start looking for other ways to promote their products - SEO, Google, independent aggregators like Search-Matching and classifiers like Avito. Already, Avito attendance is more than Yandex.Market, and in six months the gap will only increase.

What can we expect

According to the analyst of Otkritie FC, Alexander Vengranovich, the method of attracting financing through Sberbank may indicate that Yandex is not completely sure that its e-commerce strategy is correct:
Perhaps they tried to reduce risks, to share them with a partner. It is clear that competition from the Chinese and American e-commerce sites will increase. Yandex.Market could not stand it. However, the transformation of the service into a similar site, the construction of its own logistics is a rather complicated project, the return from it is unclear.

A partnership with Sberbank will give Yandex.Market access to the network of its branches in cities, will allow the introduction of an instant loan service and will provide other benefits. The hypermarket will be able to provide such advertising offline, which neither Wikimart nor Avito has.

Become the first online store within our country, "Market", of course, hardly anything interferes. But he is unlikely to get 50% of the online shopping market - too many pitfalls and large domestic competitors. And as soon as Amazon decides to enter the Russian market, the same story is likely to happen as Facebook vs “Vkontakte” and YouTube vs RuTube.

So far, the question can be viewed from two positions:

1. The glass is full

The transaction of Sberbank and Yandex may give the market a positive charge. What is lacking in Russian online retail is competition. In the new realities, the shops that rely on the “Market” will have to develop, find new ways to attract the user. First of all, the buyer will win, who will vote for the most pleasant ideas with his wallet. And in the future, the Market may become just as cheap as in the American Amazon (only, of course, adjusted for Russian taxes and fees).

2. The glass is empty

Sberbank and Pochta Rossii, Yandex’s new friends in online sales, are known for their penchant for monopolizing the market. Thanks to their resources, the Market can in a couple of years be made the main (and, in fact, the only) platform for online sales. Cases in "Citylink", "Yulmart" and "Eldorado" are, frankly, not very. It will be extremely difficult for them to compete with Sberbank + Yandex. There is a fear that after the introduction of horse customs for packages with purchases from countries outside the EEU, they will stall us and force us to buy only on the Market. It will become much more difficult to take and bring parcels from the real "Amazon" and other foreign stores, but there will be no competition inside.
Which option seems more likely?

While the Russian "Amazon" is trying to fly, you can buy on a real Amazon - the prices of clothing and electronics there will always be much cheaper than in Russia. And you can deliver all overseas parcels from Register with this link and enter the GEEKTIMES code to get $ 7 to your account. Ordering directly from the USA is actually not much more difficult than taking something on Yandex.Market.


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