Building a Cross-Border e-Commerce Success Selling to Russia: Bay.Ru CEO Aaron Block (Part 6)

Sramana: Would you say that your shipping algorithm is one of your core competencies?

Aaron Block: Our proprietary shipping algorithm is something we think is very special and we covet it. Another interesting aspect of our business is that we have the majority of our operation is in Chicago even though we focus on the former Soviet Union. We have 55 employees between the two countries and more than 40 of them are based in Chicago. There are only four of us in the company who were not born in the former Soviet Union.

Sramana: You basically have Russians working in Chicago for an e-commerce company that sells in Russia?

Aaron Block: Correct. Most of them are immigrants, and some of them are here on assignment. Most of us in the executive ranks travel back and forth a lot. I spend a week or two there every month. The head of Russian operations spends one to two weeks in Chicago a month.

Sramana: What is the Russian marketing strategy? How many customers are transacting through your platform?

Aaron Block: This year we should do 200,000 orders.

Sramana: You are going to do $40 million on 200,000 orders?

Aaron Block: Yes.

Sramana: Wow. I assumed this was more of a consumer business, but those numbers are along the lines of a B2B business.

Aaron Block: It is a consumer business. The order values are very high.

Sramana: That is fascinating. Tell me more. Who are your customers?

Aaron Block: Our customers cut across the entire population. If you have money and want to buy goods, then you are going to be interested in shopping abroad because the supply is so far below the demand in Russia. Our customers range from one-off purchasers in small villages in Siberia to twenty-something cosmopolitan yuppies in St. Petersburg and Moscow. About half of our business comes from a combination of the Moscow and St. Petersburg regions. The other half comes from the rest of the country.

Sramana: Are there any other nuances to the Moscow and St. Petersburg customer base? How do you figure out whom to target when you market there?

Aaron Block: People are very brand oriented. We spend a lot of time focusing on brand preferences. We do a lot of digital marketing although television is on the horizon. That has been a great success venue for other online businesses in Russia.

Sramana: Traditionally consume marketing is defined by demographics. They have ages, disposable income, and regions. Do you know that data for your customers?

Aaron Block: I would rather not go into too much detail, but yes, we do know that data. Our customer base is primarily men. We have a very uncommon business. We have high-value orders, a predominantly male customer base, and a distribution that covers the entire country.

This segment is part 6 in the series : Building a Cross-Border e-Commerce Success Selling to Russia: Bay.Ru CEO Aaron Block
1 2 3 4 5 6 7