As the Russian government called retailers to keep their prices stable in spite of spiking demand for certain goods, Ozon – a top online retailer and marketplace – announced Friday that it was capping the prices of essential goods to protect customers’ interests.
Even though Russia had only 367 confirmed COVID-19 cases as of March 22, supermarkets have been stormed as the population in Moscow and other big cities anticipate being put on lockdown. Russian shoppers have moved online en masse for their daily essentials and groceries.
“In these conditions, multi-category e-commerce sites have become, for many, the most convenient place to order all of their necessary goods. As a result, Ozon has seen an increase in demand over the past 1.5 weeks, with sales of everyday products more than doubling and sales of personal care products growing by a factor of three or more,” Ozon CEO Alexander Shulgin said in a statement.
“The company also offers two types of contactless delivery options, whose popularity is rapidly growing: over the past week, the number of door deliveries increased by 60-70%, while the use of parcel lockers increased by another 20%,” he added.
Afraid of panic buying spreading to the online stores, the company has adopted several practices to ensure shoppers have access to goods. As Ozon operates a marketplace, a channel where manufacturers can reach a large audience, the manufacturers retain control over prices. Ozon has moved to prevent its partners from gouging their customers.
Maintaining “fair prices”
“In the current situation, it is especially important to maintain quality service and fair prices,” said Ozon marketplace director Anna Kaleeva. “Marketplace sellers already account for more than 70% of Ozon’s assortment, and we have unfortunately seen massive attempts to take advantage of the increased demand and the mood created by the current information field. Therefore, in addition to monitoring prices 24/7, we decided to limit the maximum price threshold for the most popular goods. We sent out an informational letter to the more than 9,000 sellers on our site and warned that they may face penalties in the event of violations.”
Over the past few days, the company has blocked several hundred product cards from dozens of companies on its platform. If Ozon’s monitoring system detects a violation of the maximum price, then the site blocks those goods. If the seller continues to ignore the rules, Ozon may block all of their products on the site.
The company has also moved quickly to block product cards with inflated prices that have been brought to Ozon’s attention by customers via social networks. To do so, individuals can send Ozon a private message through its public pages on Facebook, VKontakte and Instagram.
In its letter to sellers, Ozon has asked sellers working from their warehouse to carefully monitor the situation if the warehouse is closed for quarantine. Marketplace partners are asked to mark the entire period during which their warehouse will close as days off in their personal account on the site, in order to give customers a better understanding of the possible delivery time for their orders.
Contactless delivery
Last year Ozon introduced a contactless delivery procedure, with couriers dropping off ordered goods at the door without interpersonal physical contacts. The method is new in Russia, where there is a widespread belief that the package will be either stolen or damaged.
However, the service turned so successful that Ozon now offers it in more than 20 cities across Russia. “We haven’t had a single case of vandalism or theft since we launched the service six months ago,” Ozon’s CFO Daniil Fedorov told East-West Digital News.
Contactless delivery is now even more in demand amid mounting coronavirus fears. In the first two weeks of March 2020, the average number of contactless door deliveries was up 60% from Q4 2019, the online retailer reported.
Lamoda, a major online fashion platform, has just introduced a similar system, with couriers staying by at least three meters after dropping off the order at the customer’s door, and customers encouraged to pre-pay their order online.
