State-of art and prospects of development of Ukrainian electronic commerce

Abstract

The Ukrainian market of electronic commerce is one of the most successful markets of Ukraine. It demonstrates the stable positive dynamics in turnover, growth rate and other indices, reflected in numerous but at times contradictory publications. The aim of the article was to investigate the real state and trends of electronic commerce development in Ukraine, to reveal the most promising electronic commerce business models and assess the problems and prospects of these models further introduction. The main results of the research. Analysis of the data from the different sources with taking into consideration different methodologies of their calculation and exchange rates resulted in obtaining the structured data adequately reflecting a state-of-art of Ukrainian electronic commerce market. It is shown that expansion of electronic commerce in Ukraine is caused not only by the growth the Internet penetration level but also by the fact that for more and more of our citizens Internet appear to transform into the natural environment of existence within which more and more demands are satisfied. That is reflected by the permanent growth of Internet-users / e-shoppers quantity and Internet-purchases amount. Investigation of business models implemented by Ukrainian e-retailers has revealed that such business models as electronic storefront (manufacturer's web-site ``Manufacture Direct{''}), electronic shop / electronic mall, electronic classified, price aggregator, e-auction and third-party marketplace appear to be the most popular and successful in electronic retail, though considerable part of merchants applies the hybrid models ``classified + price aggregator{''} (Ria.com), ``supermarket + marketplace{''} (Rozetka. com, Lamoda.ua). It is shown that on the initial stage of development the Ukrainian electronic commerce market was occupied mainly by online shops and price-aggregators, i.e. enterprises with merchant and referral (advertising) revenue models. However, now they yielded in popularity and profitability to the electronic marketplaces, classifieds and companies with hybrid models ({''}supermarket + marketplace{''}, ``classified + marketplace{''}). Comparing the business processes of fulfilment of leading domestic and foreign electronic merchants with similar business models has shown the substantial lag of domestic companies, especially niche electronic merchants, from foreign ones. Trends of development of business models of Ukrainian electronic merchants and directions of their perfection are revealed, criteria of choice of certain business model are presented. Conclusions and directions of further research. The age structure of Ukrainian Internet users gives an opportunity to consider the Internet to be an attractive channel of the consumer demand formation with the highest rate and potential of growth in the near future. The 3G Internet diffusion and total ``mobilization{''} of consumers, while belonging the largest segment the Internet users to the generations. and Z, as well as economic crisis proved to be uppermost responsible for that. While the mobile Internet coverage expansion provided the quantitative growth of the Internet audience and age-related features of users in age segment ``18-35 years old{''} promoted the increase of time spent in Internet with better disposition to the online-purchases under more significance of the factor ``economy of time{''}, the reduction of purchasing capacity of older consumers compelled them to take more care more about the process of search and choice of the goods, what strengthened the advantages of Internet-merchants in comparison to a traditional retail due to lower prices and wider assortment. The application of such business models as electronic marketplace, classified and niche e-shop / e-mall seems to be the most efficient in the domestic e-retail. The change of users in the most active age groups due to the natural aging results in lowering the barriers penetration to the Ukrainian e-commerce market for the foreign companies. A new generation lives in a new rhythm, and the comfort of service, possibility of the access to the necessary good or service, realization of the demand in the moment of origin becomes more and more important. People want to get the consolidated value proposal personalized according to their tastes, including those expounded in past. All that improves positions of foreign e-merchants offering more comfortable pay services and terms of delivery, methods of innovative perfection of which are to become the subject of further research. In general, it is possible to assert that, regardless of the business model selected, success at the market of e-commerce will depend on introduction of innovations in all spheres of activity, first in personalization and realization of fulfillment; only innovations will give to the domestic companies an opportunity to compete successfully with foreign Internet-giants.