Create best possible experience for Polish consumers & merchants
Allegro is a Polish online e-commerce platform. Kacper Rozenbaum, Head of International Sales, Allegro, spoke to Paulami Chatterjee about the company’s growth since inception, how it has registered a jump in its revenue since the pandemic hit the world and the special services launched to attract more customers to its site.
Where does Allegro rank in the e-commerce scene in Poland?
Allegro.pl is the most popular shopping platform in Poland and one of the largest e-commerce websites in Europe. We operate a marketplace model which means that customers can buy whatever they need from over 128,000 merchants, who can list an unlimited number of offers on our platform.
Which are the remotest areas of the world that you have shipped to?
Allegro buyers are based mostly in Poland and in neighbouring countries, therefore sellers are shipping to Poland.
Which are the difficult areas where you face issues of spoilt return products, loss or difficulty in realised COD payments or any other such issues?
The majority of our orders are paid in advance and we do not observe any serious problems with payment methods. When it comes to returns, it's obvious that in the fashion category they happen mainly due to wrong sizes. Our return rate is lower than the market standard.
How challenging has the road been since the inception of brand Allegro and what is unique to your marketplace?
For the last two decades we have been serving Polish consumers and promoting the idea of entrepreneurship in one of the most innovative areas of the economy. We have come a long way from an auction site for private individuals looking for a modern alternative to their local flea market. Today, we are a vibrant marketplace platform for professional sellers and a must-have sales channel for top international brands and retailers.
What are your criteria for merchant on-boarding? What are the 5 key requirements before take on one?
Allegro is an open platform -- we welcome any merchant that sells goods from verticals available on Allegro - which is almost everything. There are two critical steps during the onboarding process -- registration and offer listing.
We want to make sure that all Allegro transactions are safe and in line with the European Law regulations. That is why we need to verify the seller's business account and we require several documents--company registration documents, an identity document of the company’s representatives and information about the actual beneficial owners (name, surname, birth date, nationality).
Second step is offer listing and as a company focused on Polish buyers, we require a Polish version of the offer title and description. This could be done through cooperation with one of our translation partners or by the seller himself. There are multiple ways to upload an offer--direct API connection, upload via one of the popular international integrators or uploads using a simple spreadsheet.
The e-com format of deep discounts has irked the brick-and-mortar players. What is your response to it?
Allegro is a marketplace, where sellers are responsible for their pricing level. At the same time all merchants are welcome to Allegro and we have a strong representation of both pure e-commerce players and top brick-and-mortar players.
E-comm has seen a boom post the onset of the pandemic. How much has your business grown since the pandemic struck from digital commerce and merchant partnerships?
In Q1 2021 the gross merchandise value on Allegro reached PLN 9.6 billion, an increase of 46.1 per cent YoY. The group’s net revenue during the period was PLN 1.21 billion, up 61.1 per cent from the 1st quarter of 2020. After the rapid growth seen in 2020, our results in Q1 continue to improve both on the consumer facing inputs and financial outputs. In Q1, we continued to improve retail basics, ensuring the most competitive prices, growing selection and scaling up new areas such as Allegro Pay and the Allegro Biznes platform (B2B platform).
We continue to look forward to the end of COVID restrictions and are confident that all the innovations we planned will ensure that Allegro remains the best place for consumers to shop.
How many merchants are registered with you as on date? Are they only local merchants of Poland or spread across the world?
We have over 128,000 merchants including international ones. In Q1 2021 we noted a double digit increase in the number of sellers.
What challenges are small and medium sized apparel companies facing when they start selling through the marketplace?
Selling through a marketplace is not much different from traditional online sales. In the case of fashion, it is highly recommended to provide high quality images (on a white background), good description (in Polish, focus on the fabric composition) and precise size chart.
What are the shopping patterns you have observed in people which are here to stay?
We do not record any specific shopping patterns. What we can underline is that fashion is a weather sensitive category. Moreover, we see an increase in sales of some categories over a certain period of time. It depends on various circumstances and events (eg increase in backpack sales in August / September as a result of the back-to-school period).
Which are the special services you might have introduced to bring in more customers to the site in the last 1 year?
In recent months we onboarded popular brands such as Fila, Apart, S.C Johnson and Decathlon, and secured even more competitive pricing with the continued roll out of seller facing tools, nudges and incentives e.g by introducing ‘Super Cena’ tag to help consumers find the best deals.
We also continue to improve the shopping experience and make online shopping even easier and more convenient by, among others, launching Allegro Family. Thanks to family groups, the closest ones can share all the Allegro benefits and help each other in shopping while maintaining the privacy of their individual accounts. One adult in the family, the organiser, can easily invite all the other members by email to join the family group (up to 10 people). Family accounts also support both young and silvers in being independent and self-reliant in online shopping.
We also continued expansion of the Allegro Smart! - our programme of free deliveries and returns - the growth in Smart! users during the 1st quarter exceeded expectations. Thanks to the “Smart! na Start” any consumer can test the service and receive a pool of 5 free deliveries to be used within one year. Allegro also lowered the minimum threshold for free courier delivery in Smart! to PLN 80.
From the sellers’ perspective, we introduced, among others, a fast delivery incentive programme for sellers. The increased speed of delivery, and delivery promise, drives increased customer frequency and purchases.
How is competition like from e-commerce biggies such as Amazon, Flipkart and Snapdeal, Myntra etc?
We keep our focus on making Allegro the first choice for Polish customers and the best place for sellers to do business. Delighting them is as important as ever. That’s why Allegro keeps investing in innovation, bringing more and more customers to our platform, investing in our people, and creating the best possible experience for Polish consumers and merchants. We already offer a vast selection of over 200 million offers, low prices, and fast and free Smart! delivery.
With so many online players, what is the repeat percentage at Allegro?
Allegro.pl is the most popular shopping platform in Poland and one of the largest e-commerce websites in Europe. Our mission is to offer the best shopping experience to customers and great business opportunities to merchants. We focus on their needs, which inspire us to create innovative solutions in which business and technology come together. Our NPS (Net Promoter Score) level is +77, which can be compared to world’s iconic consumer brands such as Starbucks (77), YouTube (59) and Spotify (46).
Clients continue to choose Allegro more and more for their everyday shopping. As of the end of the 1st quarter 2021, the number of active buyers exceeded 13.2 million, 13.4 per cent more than a year before. The average annual spends per buyer rose to almost PLN 2,880, an increase of 38.9 per cent YoY. What’s more, Poles are more likely to start their search for products with us, than any other popular search engine
What are your future plans?
As already mentioned, our mission is to offer the best shopping experience to customers and great business opportunities to merchants. Each of our new improvements or implementations serve and will serve these purposes. We constantly enlarge our selection, make sure that we provide our buyers with the best shopping experience possible and offer them products at most attractive prices. One of our key areas for further development is delivery - soon we will open our own logistics centre to help merchants deliver even faster. In June we also started a deployment of a green-powered parcel locker chain. The first machines have just been set up in a few cities with 1500 to be installed by the end of this year.
Which are the top-selling categories in fashion?
Fashion is one of the most visited categories on Allegro with, on average, over 1000 user visits each minute. In 2020 product selection increased by 50 per cent compared to 2019.
Top 5 selling categories in 2020:
● Women’s clothing (especially dresses, outerwear and shirts)
● Men’s clothing (sweatshirts, t-shirts and outerwear)
● Sport shoes (men’s sport shoes)
● Casual shoes (women’s casual shoes - boots, flip flops and sandals)
● Jewellry (bracelets, earrings and rings) 2PAGE
