Leading an E-Commerce Boom

Known as the “go to” online marketplace in Greece, the pandemic has contributed to drastically accelerate the penetration of e-commerce, says George Chatzigeorgiou, CEO & Co-Founder of Skroutz, with daily orders having surged by up to 7,000%.

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GIG: How did the idea for Skroutz come about?

Chatzigeorgiou: The idea to create skroutz.gr was born in 2005, when a friend was interested in buying a new PC and was trying to compare prices. I realised that although there were many price-comparison websites abroad, Greece fell behind on that, so I started working on creating a price-comparison website, while at the same time I had a morning day job. I did not perform any market research, nor did I check the competition. I was only looking to do something that pleased me and had no plans to build a company.

Skroutz started as an aggregator for electronic products. It kept growing, so I approached the two co-founders, George Avgoustidis and Vasilis Dimos, and we started working on building a price-comparison website and a company. Together, we managed to grow Skroutz into the number one site that Greeks trust for their online purchases.

Today, 16 years later, Skroutz SA manages Greece’s leading e-commerce platform with more than 6 million products from more than 9,000 partner stores. We employ 480 people and record more than 8.5 million unique visits on a monthly basis.

GIG: What are some of the key changes you have noted over the years in terms of the Greek consumer’s comfort level with online shopping? And how much of a role do you believe Skroutz has played in terms of educating the consumer as well as Greek businesses on using/adopting e-commerce?

Chatzigeorgiou: As the very first platform for e-shopping, Skroutz introduced and “educated” Greek consumers and Greek merchants on online purchases.

A huge network of merchants trust Skroutz Marketplace – an efficient sales channel – to attract new customers. Even businesses that do not have an e-shop or an online presence can sell their products on Skroutz Marketplace all across Greece.

With regard to the key changes over the years, I would say that first, today – and a positive impact of the pandemic – consumers are much more familiarised with online shopping. During the first quarter of 2020, 47.8% of Greeks using the internet made an online purchase. On the other hand, the development of high-quality services by market players enhances the sense of trust in online shopping. The restrictive measures adopted due to the pandemic enabled Skroutz to contribute back to the economy by providing the platform to 3,500 merchants with no online presence. These merchants joined Skroutz Marketplace, entered the world of e-commerce, and were able to sell their products to the Greek market during a period in which they would have most likely remained completely out of business.

Also, the increasing digitalisation of banking services coupled with innovative and easy-to-use e-payments ensure secure and flexible online transactions, creating a feeling of trust in online shopping. This is key for the further development of e-commerce.

Finally, the rapid growth of internet penetration and network infrastructure (both fixed and mobile) in Greece will lead to an even stronger growth of e-commerce.

GIG: How many stores and how many products does Skroutz feature today in its marketplace and retail platform? How does Skroutz differ from tech e-commerce giants such as Amazon and Alibaba?

Chatzigeorgiou: The Skroutz platform displays more than 6 million products from more than 9,000 partner stores from all over Greece. We have built a strong base in the Greek market and we are constantly evolving and growing in a continuously growing market.

Amazon and Alibaba are two e-commerce giants that shaped, and still do, the global market. Each company has a different strategy and major differentiated characteristics.

At Skroutz we offer a unique experience to our users, which is based on the needs of Greek users and Greek merchants. Our 16 years of experience in the Greek market allows us to be able to fully understand the Greek e-commerce landscape and be agile in the way we develop our product.

GIG: How has COVID affected you this past year?

Chatzigeorgiou: First of all, market conditions changed and that was a major push for e-commerce. The restrictive measures brought severe changes in consumer behaviour as well as in merchant behaviour.

2020 was a milestone year for us. In line with our business development strategy, we reached a major business agreement with CVC, one of the largest private equity companies in the world. We also entered the e-payment market by acquiring 25% of EveryPay, we welcomed more than 3,500 new retail companies into Skroutz Marketplace, and we achieved a large increase in the generated turnover for the retailers we cooperate with.

In early 2021, we acquired 100% of SendX, a strategic investment in the so-called last-mile sector (i.e., the delivery to the consumer) that hopefully will allow us to create our own network to better serve consumers and provide new value-added services to partner companies.

GIG: How many online orders on average does Skroutz receive a day?

Chatzigeorgiou: We have witnessed a major increase following the pandemic outbreak last March. The product categories exclusively available through our Marketplace expanded from 280 to 1,800, whereas daily orders went from 200-300 before the pandemic to a peak of 14,000 orders in a day.

GIG: What are your plans for future growth, such as for e.g. expanding delivery through SendX (Greece and abroad?)

Chatzigeorgiou: Our vision is to offer the best online shopping experience to consumers as well as business partners in a safe, reliable and optimised online environment. Therefore, our future growth is being planned in this direction. The user’s journey is “important” and we work hard to optimise each stage from product selection and price comparison across to online transaction and fulfilment.

As for SendX, it will serve orders placed through our Markeptlace in Attica, while it will gradually expand to other cities in Greece to serve an even larger number of orders nationwide.

We also aim to offer access to more retailers, through Skroutz Marketplace without having to set up an e-shop. In critical times like the pandemic, we must all contribute to providing solutions that support the market and enhance the digitalisation of the economy.

We improved our organisational structure and strengthened the management team to support our growth course. Today, Skroutz counts with 480 employees and we are going to grow even more within 2021.

GIG: How did the participation of Dionic, Southbridge and later CVC Capital Partners impact Skroutz?

Chatzigeorgiou: All our partnerships aim to bring us one step closer to our vision: to provide the best online shopping experience to both consumers and our business partners. We are very happy that we have collaborated with Dionic, Southbridge and CVC Capital Partners as they are three milestones in the 16-year-old history of Skroutz.

The latest partnership with CVC Capital Partners has expanded the company’s potential for further growth and innovation in e-commerce, while strengthening the Skroutz team’s drive to develop new services. It was a result of a strong performance over the years and continuous effort for growth and development.

GIG: What tech advances do you see in the near future as drivers for the e-commerce sector worldwide?

Chatzigeorgiou: A smooth customer experience across platforms and channels is the key driver for e-commerce worldwide and our vision at Skroutz. Thus, any relative tech advancement is an opportunity. In the Greek market, we have identified and acted upon two challenges in the Greek market that will drive e-commerce forward: the first lies in the field of payments and the second in the field of the last-mile.

At Skroutz, we have announced our strategic partnership with EveryPay, an e-payment systems provider, and SendX, a courier services provider. The first one will allow us to develop innovative, reliable, flexible and, above all, secure solutions in online transactions. The latter, the “last mile”, which is an important stage of the user’s journey, will allow us to invest and grow in a segment where there is room for improvement and development.

GIG: What makes Greece a good investment today, particularly within the scope of technology and e-commerce? What are some of Greece’s comparative advantages?

Chatzigeorgiou: Greece presents increased potential for growth in multiple sectors. Greece is getting out of a 10-year crisis and despite the effect of the pandemic, there are great investment opportunities.

With regard to e-commerce, Greek consumers show more trust than they did before in online shopping, according to statistics. The shift to online shopping seems to be established now, as the benefits to both consumers and merchants are important.

Moreover, there are big and significant investments in the country’s internet infrastructure (fibre optic and 5G networks). This means that more and more Greek consumers will have access to faster internet services, a critical point for online shopping.

GIG: What advice would you give those embarking on tech start-ups in Greece?

Chatzigeorgiou: There are a lot of things that someone who embarks on a tech start-up in Greece must pay attention to. But one very important one is that they should always have a vision and never lose the passion to follow it. Also, you need to understand marketing, HR, and business, in general. Especially when your role affects the company’s future and you are the one making the important decisions. Moreover, you need to be quick, adaptive, and agile during big changes, especially when unexpected things such as the COVID crisis happens.

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