A leading Russian bank and the largest online Russian marketplace have announced a joint venture that will likely improve cross-border ecommerce.
Sberbank is the largest and most trusted saving bank in Russia. It is partly state-owned and has over 325,000 employees. It is also the oldest bank in Russia, dating to 1841. The bank has 16,500 offices in 22 countries. Total assets at the end of 2016 were $416 billion.
Yandex.Market is mainly a comparison-shopping site — the largest in Russia. Merchants can showcase, advertise, and sell their products. Buyers can read reviews and compare the prices of the same product from different stores.
Sberbank has sought a foothold in ecommerce. After an attempted joint venture in Alibaba reportedly fell through, it turned to Yandex, which is also the top search engine in Russia. The deal should close in 2018.
Yandex.Market will receive, initially, roughly $500 million from Sberbank. With the money, the parties intend to significantly upgrade the site to control more of the payment and checkout process, as well as fulfillment and delivery. Yandex will have access to Sberbank’s huge customer base — roughly half of all Russian consumers.
The joint venture is promising news for Russian merchants, who will finally have a one-stop place to sell globally. But how will it influence sellers outside Russia? I asked that question to a Yandex.Market representative. Here is what I’ve learned.
Yandex.Market is open to the world. Anyone can sell there regardless of location. Over 3 million people visit Yandex.Market daily to search for products, read reviews, and compare prices. To address customers’ desires for brands and trends, Yandex.Market is now seeking foreign retailers.
Yandex.Market will offer special marketing support to non-Russian merchants. Yandex is, again, the leading search engine in Russia, with almost 50 percent of all contextual advertising. Moreover, it offers other promotional tools for ecommerce, such as cross selling on the Yandex.Checkout service.
Delivery problems are often the reason Russians do not purchase from foreign e-stores. The joint project will create a delivery fulfillment service with multiple partners in Russia and abroad — all operating under Yandex’s control.
Non-Russian merchants selling on Yandex.Market will have three logistics options: deliver from the merchant’s country, deliver from a foreign warehouse near Russia, or deliver from a warehouse in Russia. All three options are being tested at the moment to create the best experience.
Under the expanded fulfillment options, merchants can, alternatively, transfer their products to Yandex warehouses and delegate the entire storage, order processing, delivery, and returns to Yandex.Market.
In the short term, Yandex.Market will continue to use its current payment aggregator, Yandex.Checkout. It’s the most popular payment solution in Russia and Russian-speaking countries. It provides popular payment methods, including credit cards, mobile phones, e-money, and cash on delivery. It also provides instant loans to Russian buyers. AliExpress uses Yandex.Checkout for its Russian storefront.
In time, Yandex.Market intends to add additional payment aggregators. Yandex.Market will provide foreign merchants with necessary sales documentation, such as receipts, delivery notes, and return requests.
In short, the joint venture should significantly improve Yandex.Market for Russian consumers and, importantly, for cross-border merchants.