Russia’s Sberbank and Yandex announce a huge investment to create an "e-commerce ecosystem" for domestic and foreign players.

Adrien Henni, chief editor, East-West Digital News

Adrien Henni, chief editor, East-West Digital News

Sberbank, Russia’s state-owned national savings bank, and Yandex, the NASDAQ-listed Russian search company, intend to create jointly a “leading e-commerce ecosystem” based on the existing Yandex.Market marketplace, and open to foreign merchants.

The emergence of such an ecosystem would be good news for Western players interested in selling goods or services to Russia’s 40 million online consumers. So far, the better part of cross-border sales to Russia has been controlled by Chinese AliExpress, while eBay’s popularity in Russia has been declining over the past few years.

Fierce competition

Yandex.Market currently offers access to over 20,000 merchants (including a small fraction of foreign ones) and 150 million products. The platform used to dominate the Russian e-commerce marketplace realm, but now struggles with two very strong competitors.

Inspired by the Amazon model, Yandex.Market has significantly increased its control over fulfilment and delivery.

AliExpress, which is by far number one in the Russian cross-border e-commerce race, has opened its marketplace to local sellers too, and its traffic (23 million monthly visits according to SimilarWeb) matches that of Yandex.Market (more more than 19 million desktop and laptop users each month according to TNS Global),

Another competitor is The country’s first classifieds site, Avito allows businesses to operate on its site, and attracts more than 21 million desktop and laptop users every month (source: TNS Global). The site was acquired in 2015 by South African company Naspers in a $1.2 billion transaction.

Latest evolutions

In this context, Yandex.Market has evolved significantly over the past few years. Inspired by the Amazon model, the marketplace has significantly increased its control over fulfilment and delivery processes. Two years ago the platform launched the Yandex.Delivery service, aggregating offers from several e-commerce shipment service providers.


Now Yandex.Market intends to go even further: “We will build [our own] logistics and delivery system to aggregate goods in warehouses and offer the best delivery price conditions to our customers,” said Maxim Grishakov, the CEO of Yandex.Market, in a recent media interview.

The marketplace intends to use Sberbank’s funding to improve these logistics capabilities as well as to implement a checkout function on the site at a large scale, and “enhance its value proposition to domestic and international merchants.”

In addition, Yandex.Market would like to leverage Sberbank’s banking and payments infrastructure to “develop simple and secure payment solutions on the Yandex.Market platform and introduce new features, such as consumer lending,” Grishakov stated this morning.

And the winner is… Yandex


Sberbank considered several options to get more involved in Russian e-commerce. The bank initially considered an alliance with Alibaba, or Mail.Ru Group, or an exclusively in-house development strategy. The recent announcement of a joint venture with Yandex, if confirmed, could help the bank realize its e-commerce ambitions.

Should the agreement announced this week be approved by the Russian regulation authorities, Sberbank will invest some $500 million (30 billion rubles) to develop the “ecosystem.” While Yandex.Market would be valued at $1 billion (60 billion rubles) after that investment, Sberbank and Yandex would own equal stakes in the joint venture, with up to 10% of the shares allocated to a stock option plan for Yandex.Market’s management and employees.

According to EWDN’s Russian E-Commerce Report, online sales in 2016 exceeded $26 billion, growing more than 20% year-on-year. Included in this figure are some $16 billion for physical goods and $10 billion for online travel, according to Data Insight. The cross-border segment is the fastest growing, up 26% by value and 80% by the number of parcels and small packages, and exceeded $4 billion for physical goods alone, according to Russian Post and industry association NAMO.

East-West Digital News is an international news and consulting agency dedicated to the digital and e-commerce markets of Eastern Europe.