The rapid growth of the Chinese Internet giants - AliExpress and JD in the Russian market fascinates and scares at the same time. In a matter of months, AliExpress acquired a representative office, a Russian-language version of the site and arranged delivery. The result - in May, the Russian audience of visitors exceeded the number of users of the social network Facebook, amounting to 22,627 million people.
How is aggressive Chinese expansion changing the domestic shoe market? How serious fears does she inspire for Russian operators?
Miroslav Zubachevsky, managing director of KupiVip E-Commerce Services, believes there is no reason to panic yet. “Chinese expansion into Russia today is a phenomenon directly related to low-price and low-quality goods,” he explains. - Russians who are accustomed to wearing Baldinini, Fabi, Jimmy Choo or any other premium or luxury segment simply cannot find suitable products on AliExpress. The business of KupiVip Group is primarily based on working with high-quality licensed fashion brands in Europe and the USA. Moreover, we sell these brands at an average discount of 70% to 90%. We occupy a unique niche in which we have no direct competitors. So we do not see any direct threat to our business ”.
Daria Yadernaya, CEO of Y Consulting, believes that there is no one to compete specifically with in the ultralow price segment in the Russian market on AliExpress, we do not have similar online projects. “But in general, Chinese expansion is quite seriously changing the face of the domestic market, since it sharply increases the share of the budget segment, which has been eroded in recent years due to the transition of open markets to a higher price category,” the expert says. According to her estimates, AliExpress may occupy up to 3% of the market if it maintains its current growth rate. “Despite the fact that pressure on prices will increase, it is unlikely that other retailers will change their pricing policy, since they already work with low margins,” Daria continues. “Switching the audience from civilized retail to AliExpress will be negligible.”
The situation can change dramatically, not only in the Russian, but also in the global fashion market, when Chinese manufacturers begin to create high-quality designer goods in the “above average” category and develop strong domestic brands, Miroslav Zubachevsky said. “These things will first get proper distribution in their local market, and then they will go into the phase of active expansion,” he says. “The KupiVip Group is already developing various options for partnership programs of this kind with China and I think in the near future we will be able to present a pleasant surprise for our customers in Russia and the CIS.”
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