Amazon, eBay and Chinese platforms dominate the global eCommerce space, but Polish eCommerce firm Allegro has earned its stripes as one of the most popular such platforms in Poland and one of the top eCommerce brands in central Europe.
According to data from SimilarWeb, the Polish platform is the 10th largest eCommerce platform in the world in terms of monthly visits and the only company in the top 10 list that operates in Europe. The company launched more than 20 years ago, offering services similar to eBay’s, and today it holds 33% of the eCommerce market, employing over 3,750 workers. Its website attracts over 20 million visitors a month.
See also: Amazon Opens for Business in Poland
Amazon is the platform’s largest competitor in Poland, and the rollout of Amazon Prime service in Poland with free delivery and video streaming this month sent Allegro shares dropping by 3.7%. Amazon’s Polish website went live prior to that in March, increasing competition in the country’s eCommerce space with the pricing of its Prime service at 49 zlotys (about $12.35) per year.
In this piece, PYMNTS takes a closer look inside the Polish eCommerce platform making waves in Europe, highlighting five things discovered in our analysis.
Allegro has the biggest-ever initial public offering (IPO) on the Warsaw Stock Exchange to date.
On the back of strong revenue growth, profitability and growing cash flow, Allegro became the largest-ever IPO in Poland’s history last October, raising about $2.3 billion at a valuation of $17.6 billion when it listed on the Warsaw Stock Exchange (WSE).
Only a quarter of Allegro was floated in the IPO to achieve the feat, and the firm has since joined the WIG20, the 20 largest companies on the WSE, which grew by 0.61% to a three-year record high last week.
“Allegro is a unique success story shaped over 20 years, from local startup to a European eCommerce champion,” Allegro CEO François Nuyts said in a statement announcing the company’s intention to publicly list on the WSE a month prior.
“Alongside 12.3 million active buyers and 117,000 merchants, we are leading the digital transformation of Poland’s economy and improving the everyday lives of millions of Poles and thousands of [small- to medium-sized businesses (SMBs)],” Nuyts added.
Allegro has put its business on an eco-friendly path.
Allegro has been going green, launching green parcel lockers in Poznań and Warsaw, its first environmentally friendly parcel lockers, in June of this year, according to a press release.
“Our parcel lockers will be powered by renewable energy sources and provided with air quality sensors, and we’re going to publicly share our metrics,” said Allegro Head of Public Affairs and Sustainability Marta Mikliszańska in the release. “Noise and visual pollution are also our key considerations.”
The company is also working with local governments as part of its goal to invest in green walls on buildings.
Allegro launched a new logistics service for merchants.
In September, the company launched a new logistics service, One Fulfillment by Allegro, “to help businesses with storing, packaging, dispatching and delivering orders, as well as handling returns,” the company stated in a press release.
Merchant clients can now provide customers with a wider range of delivery options at competitive prices negotiated by Allegro, enabling customers to benefit from next-day or same-day delivery services.
Allegro has invited “a few dozen” businesses that use its platform to join a pilot program before the service becomes widely available to merchants in the first quarter of 2022, adding 1,200 jobs at its new One Fulfillment center.
Allegro acquired a same-day delivery courier partner to complement its fulfillment and lockers rollout.
This month, the Polish firm acquired one of its smaller-scale, same-day delivery courier partners, X-press Couriers, to further develop the service and complement Allegro’s One Fulfillment offer and locker infrastructure rollout, according to a press release.
X-press Couriers offers same-day delivery within Poland’s nine largest municipalities, and it complements the recently launched the One Fulfillment by Allegro pilot program.
Allegro Business Development Officer Grzegorz Czapski said in the release that several million users on the platform have the option of same-day delivery, and as customers use that service as an alternative to offline shopping, the company has noticed that it drives additional sales for merchants.
“We expect that scaling these capabilities and rolling out to further big cities — when coupled with our fulfillment and lockers services — will both enhance customer experience and allow us to deliver those services at marginal cost to our customers,” Czapski said.
Allegro is setting up new revenue streams.
According to a press release summarizing its second quarter results for 2021, Allegro Pay continues to gain popularity given its “simplicity and convenience” with loans originated, increasing by 95% to reach 347 million zlotys (about $88 million) in Q2.
Allegro Biznes, launched in February for B2B clients, has grown to surpass the total marketplace as offers with B2B discounts continue to soar and “buyers praise wide selection, quick shopping and safety.”
The company is also planning to expand beyond Poland, and merchants can export over 35 million offers across the European Union via an integrated logistics carrier brokered by Allegro.
Despite Amazon challenging its dominance in the Polish market, the company’s revenue grew by 28.4% year on year to hit 1.3 billion zlotys ($328 million) in Q2 2021, with the number of active buyers increasing by 7.2% to reach 13.2 million during that same period.