Allegro, the unbeatable leader in e-commerce in Poland, is experiencing significant growth and becoming a key player not only in Poland but also in the European e-commerce. It is now being compared to Amazon in Western Europe and the USA. Its entry into the Czech market can bring about significant changes and influence the competitive environment.
Founded in 1999, Allegro has gradually become one of the leading players in e-commerce. Originally an auction website, it is now an example of a modern marketplace. Auctions now constitute only a minority of its sales. Globally, Allegro is the 23rd largest marketplace and among the top 3 in Europe.
One of Allegro's key successes is its loyalty program - Allegro Smart, which is used by around 5 million customers. It allows shoppers to enjoy free shipping or free returns for a month or a year for orders above a certain value. For merchants, the program represents an opportunity to increase visibility and attractiveness of their offers without significant costs.
To utilize the Allegro Smart service, you need to meet the following conditions:
The program can be compared to similar services like Alza+ in the Czech Republic with over 100,000 members and Amazon Prime with 17 million members in Germany.
Allegro, the Polish company that owns webstores Mall and CZC, is now entering the Czech Republic with significant ambitions. It is launching its own online marketplace and plans to play one of the most important roles in the Czech market.
The Allegro group also includes the company WE|DO, which will handle deliveries in the Czech Republic. It will offer customers various delivery methods, including courier services, delivery to pickup points, and self-service lockers. The capacity of WE|DO will also be complemented by Packeta services.
A similar event occurred with the entry of About You and Zalando into the Czech Republic, which brought significant changes to the online fashion market. According to statistics from 2022, the combined market share of these two platforms in the Czech Republic reached approximately 20%. Customers can choose from over 2,000 brands and more than 500,000 products available on these platforms. Thanks to extensive marketing efforts, these companies attract about 3 million visitors monthly. A comparison can also be made with Kaufland Global Marketplace's spring expansion into the Czech Republic and Slovakia.
In Poland, Allegro holds a dominant position in online shopping, with its share in e-commerce nearing 50%.
With the launch of Allegro.com, the Polish hegemon aims to expand beyond its home country. For customers in the Czech Republic and Slovakia, this means a wider selection of products, competitive prices, and other advantages that come with the expansion of the e-commerce market.
"A similar marketplace of this scale does not yet exist in the Czech Republic. Our customers can expect a wide range of products, meaning they don't have to shop elsewhere," says Martin Komora, Marketing Director of Allegro Group.
The platform has more than 128,000 sellers, of which 75% expressed interest in selling in the Czech Republic. Just a few days after the launch of the Czech version, there were over 10,000 merchants on Allegro.cz, almost all of them from Poland.
“With the launch of Allegro.cz, we conducted a survey among strong marketplace sellers at EXPANDO, and their reactions are overly enthusiastic. They perceive Allegro primarily as an entry gate for cheaper Polish competition rather than an opportunity for themselves. In the end, the customer will always decide, and the arrival of a big platform always raises concerns among sellers about how the status quo will change. If Czechs embrace Allegro, sellers will embrace it too," says David Cikánek, Head of Sales at EXPANDO.
One of these factors is the extensive catalog, which presents a challenge for adaptation to the Czech market. Allegro does not historically have unified product listings. It pays the price for its "auction origins," similar to eBay, creating confusion and increasing the number of items on the marketplace, even though not all products are unique. However, Allegro seems to have found a solution and allows customers to streamline the catalog by clicking on "combine the same offer."
Adapting this extensive catalog to Czech, ensuring accurate translation and optimization, is one of the challenges they face. The entire Allegro catalog contains over 100 million listings, but less than half of them are unique items.
Another factor that can influence the speed of Allegro's acceptance in the Czech market is the replacement of established brands such as Mall and CZC. Building brand awareness and gaining the trust of Czech customers will be crucial for Allegro's success.
From the initial numbers, it appears that Allegro is establishing itself very quickly. In May, their website had approximately 1.7 million visits, compared to around 6 million for Mall and 3 million for CZC.
CZC's website linking to Allegro.
From the perspective of the marketplace battle, it is important to mention that Allegro has a pre-emptive right on Heureka. It is therefore interesting to see how this will affect Heureka's plans for building its own marketplace. Heureka marketplace currently generates approximately 80 million EUR in annual turnover.
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