Wildberries Hit by Ukraine Drone Strikes: Impact on Russian E-commerce Sector
Main Developments in the Wildberries Drone Strikes
By Gleb Bryanski
MOSCOW, July 22 (Reuters) - From humble origins as a family business run out of an apartment near Moscow, Wildberries has grown in under two decades into Russia's top online retailer and a key economic driver in the country. It's now become a target of strikes by Ukraine.
Ukrainian Drone Attacks on Wildberries
Ukraine has attacked four Wildberries warehouses over the last week in a widening campaign of drone strikes against a company at the heart of Russia's consumer economy, bringing the war closer to millions of ordinary Russians.
In towns across Russia, pick-up points for the company and its leading rival, Ozon, have become ubiquitous. It claims to process 20 million orders a day at vast warehouses spread across the country, with a combined area of 3 million square metres.
Its co-founder Tatyana Kim has become Russia's richest woman, according to Forbes, with a net worth of $7 billion.
Impact on Businesses and Consumers
The attacks threaten serious losses for businesses that sell through Wildberries, Russia's version of Amazon.com, and potential disruption to customers who use it to buy clothing, appliances, medicines, cosmetics and a host of other products.
Broader Context of the Conflict
Russia, for its part, has attacked Ukrainian infrastructure, logistics and enterprises throughout the 4-1/2-year war. Ukraine says its deep strikes inside Russia are aimed at undermining Moscow's military effort and forcing an end to the conflict.
Russia says recent attacks on refineries and warehouses are aimed at stirring turmoil in society.
Economic Significance of Online Retail Giants
Employment and Economic Contribution
ONLINE RETAIL GIANTS EMPLOY 4 MILLION PEOPLE
Together with smaller rivals, Wildberries and Ozon sell goods and services worth the equivalent of 8.5% of Russia's gross domestic product. They provide jobs for 4 million people, or more than 5% of the country's workforce.
The "Platform Economy" in Russia
The companies form the backbone of what the Kremlin calls the "platform economy", which connects millions of consumers with sellers, couriers, warehouse workers and pick-up point operators through online marketplaces.
The firms are central to the Kremlin's plans to reinvigorate growth in a stagnating, war-focused economy. President Vladimir Putin's top man on the economy, Maxim Oreshkin, has been personally tasked with overseeing the sector.
Algorithm-Driven Economic Planning
Oreshkin has described platforms such as Wildberries and Ozon as a new form of planned economy, run not by human-led institutions as in Soviet times but by algorithms.
Profile: Wildberries and Its Leadership
Tatyana Kim: Russia's Business Icon
RUSSIAN BUSINESS ICON
Wildberries boss Kim was born in the Chechen capital, Grozny, in 1975 to a family of ethnic Koreans. She worked as an English teacher before founding the company with her husband Vladislav Bakalchuk in 2004 - a story with echoes of China's Alibaba founder Jack Ma.
The couple initially worked out of their apartment in the Moscow region but later rode the e-commerce boom of the 2010s to build Russia's largest online retailer.
Kim, a mother of seven, presents herself as a self-made businesswoman who built her empire by following her exceptional intuition. She has become an icon for many aspiring businesswomen in Russia.
Corporate Developments and Controversies
The couple went through a dramatic divorce two years ago after Kim agreed to an unexpected merger with a much smaller outdoor advertising firm, saying the deal was aimed at creating a global electronic trading platform.
The deal received the Kremlin's blessing, but Kim's ex-husband Bakalchuk disputed the merger, calling it an asset grab. Two guards were killed during an attack on a Wildberries office in central Moscow in 2024.
Strategic Alliances and Expansion
This year, the company further strengthened its position in the sector through an alliance with Russia's second-largest bank, VTB, which acquired a 5% stake in WB Bank, Wildberries' financial arm, with an option to increase its holding.
Wildberries is now building a new 400-metre-high (1,300 ft) headquarters in Moscow's City business district, next to the offices of some of Russia's largest companies, including Transneft, Norilsk Nickel and VTB.
It will be Moscow's tallest building when completed in 2030.
Reactions to the Drone Strikes
Ukrainian and Russian Perspectives
President Volodymyr Zelenskiy described Ukraine's latest targets as logistics hubs involved in supplying Russian forces with drone components and other equipment. Kim said Ukraine had attacked ordinary people doing their jobs.
(Reporting by Gleb Bryanski; Editing by Mark Trevelyan)
