The document discusses the Russian ecommerce market from 2014 to 2017. It notes that the market has doubled in size over the last 5 years and is one of the largest in Europe. However, most online retailers only operate in major cities like Moscow, leaving growth opportunities in other regions. The document predicts that from 2014-2017 the market will consolidate further and new players like financial investors will enter as retailers focus on efficiency amid economic challenges. It forecasts the market growing to $27 billion by 2017, led by categories like electronics, high-margin goods, and cross-border sales.

1. 2014: Wikimart and the
Russian Ecommerce Highlights
Wikimart front-end for type-in customers

2. Page 2 »
267
101
Source: World Bank, EIU, press Source: World Bank
59.0 58.4
84
52.1 47.9
44.6
41.1
33.4
- Local players
25.8 23.8
19.8
Mail.ru
Yandex
VK.com
Google
Youtube.com
Odnoklassniki.ru
Wikipedia.org
Avito.ru
Facebook.com
LiveJournal.com
Russian internet audience: large and growing
Internet audience size by country, 2013 (m ppl)
Russian Internet market doubled its audience
over the last 5 years …
…to become the largest Internet market in
Europe…
…still retaining significant growth potential… …which is likely to further benefit local players
Internet penetration by country, 2013 Top 10 largest websites in the Russian Internet by UMV (m users)
- International players
94%
88% 88% 85% 85% 82% 79%
70% 72% 71% 69%
59%
Norway
UK
Germany
Switzerland
USA
France
Japan
Spain
Poland
Hungary
Italy
Russia
Source: World Bank, EIU, press Source: TNS, March 2014
71
52 56
42
33 28
7 7 5
USA
Japan
Russia
Germany
France
UK
Italy
Spain
Poland
Hungary
Switzerland
Norway
3
35 38 41
61
70
76
84
2%
25% 27%
29%
43%
49%
53%
59%
2000 2007 2008 2009 2010 2011 2012 2013
Internet audience (m ppl) Penetration (%)

3. 7.9%(2) 7.3% 10.4% 6.0% 5.5% 2.7% 3.1% 0.7%
Page 3 »
Russian online retail: rapidly developing and ready for
consolidation
296.0
207.6
53.0
35.0 30.0
14.8 10.7 2.9
China US UK Germany France Russia Brazil India
66%
54%
40% 39% 34% 31%
21%
13%
34%
46%
61% 61% 67% 69%
79%
87%
China Germany UK Brazil France US India Russia
Top 5 players Other
One of the fastest growing markets
worldwide…
Online retail shoppers, m ppl Online retail market, US$bn
6.6
9.1
11.7
14.8
2010 2011 2012 2013
…already one of the largest yet underdeveloped
in the global context…
…and underinvested compared to other
emerging markets…
…with ample opportunity for consolidation
Source: RBC research
Total investments in Top-3 players(3) as % of online retail market 2013
Source: Euromonitor
Source: Euromonitor Source: Euromonitor, iResearch
Online retail market 2013, US$bn(1)
Source: Euromonitor
Online retail market concentration 2013, %
%,
total
retail
5.9
8.0
11.1
15.6
2010 2011 2012 2013
2.9 10.7 14.8
35%
16%
4%
India Brazil Russia
Online retail
market, US$bn
Notes: (1) Euromonitor except for China (iResearch); (2) As % of total consumption; (3)The following companies were used to calculate investments in Top-3
players in respective countries: Brazil – B2W, Netshoes, Dafiti; India – Flipkart, Myntra, Snapdeal; Russia – Ozon, Lamoda, KupiVIP

4. Page 4 »
Russian regions: an immense growth opportunity
Russian regions already reached sufficient
73%
Internet penetration (18+ population), May 2013 % of large online retailers present, September 2013
69%
65%
Moscow St. Petersburg Cities
(>1m)
81%
53%
44%
Moscow St. Petersburg Cities (>1m)
Source: RBC research
Online shopping penetration (% of internet users), June 2013 Online retail market 2013, US$bn
5.2% 5.8% 1.8%
6.4
1.2
7.2
Moscow St. Petersburg Regions
Source: RBC research
47%
18%
Moscow Cities
(>1m)
Cities
(0.05-1m)
internet penetration...
…however majority of online retailers are not
present there…
…restricting online shopping take-up in the
regions…
…and representing an enormous growth
opportunity
Source: RBC research
Online retail
as % of total
Source: Euromonitor, Rosstat, RBC research
15-17%
(1)
Notes: (1) Including Moscow region
Total retail,
US$bn
123 21 394

5. Page 5 »
Key online retail developments 2014 – 2017
1
2
3
4
5
New economic reality: wait-and-see for foreign investors, ruble
devaluation, stagnation of real incomes
New customer: from Moscow to regions, ever more price-sensitive
New supply: away from distributors, direct supply from Asia
and cross-border
New competitive game: from innovation and organic growth
to alliances, M&A and operational efficiency
New players: from agile entrepreneurs to heavyweight
financial investors

6. Page 6 »
Russian ecommerce 2017: what to expect?*
2006 - 09 2010 - 13 2014 - 17
Market Growth $1.2bn to $5bn (4x) $7bn to $15bn (2.2x) $18bn to $27bn (1.5x)
Stage Innovation Emergence of leaders Consolidation
Russian ecommerce leaders 2017: 65% of the market
Electronics: $11bn High-margin: $6bn Cross-border: $3bn
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2.
3.
4.
5.
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2.
1.
2.
3.
4.
5.
*Assuming flat ruble/USD exchange rate
Time Period