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Russia eCommerce Country Guide

A guide that can help you improve your cross-border strategy

Executive Summary

It’s all eyes on Russia at present, with recent political and economic turmoil rapidly diverting the nation from its former path of steady economic growth and improving international relations. Plummeting world oil prices, the highly publicised Russian annexation of Crimea and military intervention in Ukraine have all led the Russian ruble to decrease dramatically against the US dollar, and these events – amongst others - have compounded many online retailers’ fears about broaching this tumultuous marketplace.

It is unsurprising that the international retail community has recently expressed marked hesitancy concerning the expansion of their online offering to Russia. Recent politico-economic events aside, the nation’s sheer land mass presents significant challenges in terms of logistics and delivery, and adapting a digital offering to appeal to Russia’s diverse market presents further difficulties. After all, cross-continental Russian consumers express online behaviours that differ dramatically across Russia’s regions and overall consumer expectations in this location are likely to be at odds with those encountered in an e-Retailer’s familiar marketplaces.

With all challenges, however, come opportunities, and the Russian ecommerce landscape is certainly no exception to this rule. Russia is the largest country in the world, covering more than one-eighth of the Earth’s inhabited land area and -as would be expected –it also has an impressive consumer base. Russia is the world’s ninth most populous nation with more than 143 million people, and a delineated area of focus amongst the territory’s authorities is increasing the prosperity of the nation’s inhabitants and growing the Russian middle class. Russian consumers are also notorious for spending a high proportion of their disposable income on consumer goods, having been dissuaded from saving and investing from former financial crises.

Interestingly, for prospective e-Retailers into Russia, the nation’s consumers are reported to spend significant sums on electronic and white goods, as well as foreign luxury fashion brands.

Overall, Russia is a complex place to do business, and will remain so for the foreseeable future. Despite this, many major corporations have concluded that the country’s potential demands their presence there. A significant number are finding their Russian contingents very profitable, and the majority express optimism for continuing lucrative business opportunities now and in the future.

The purpose of this Passport is to detail and examine the key considerations of a prospective merchant in seeking to successfully trade with customers in Russia, a country still reporting ecommerce growth despite the strains of economic recession. From effective Russian marketing and payment strategies to obligatory requirements surrounding legality, company formation and tax, the information contained in this Passport documents the building blocks of setting up and running a successful and prosperous e-Business in Russia. The body of this report seeks to explore these considerations in detail, though some of the key findings, insights and statistics are shared in the following section summaries.

 

 

To visit the contents of this guide, visit the links below:

Demographics

Political, social and economic environment

Online and mobile usage

Online shopping behaviour

Marketing

Payment methods

Taxation

Legal framework

Logistics and communications

Customs clearence procedures