E-commerce in Ukraine

E-commerce

Internet access

In 2017, Freedom House ranked the Internet in Ukraine as "Partly Free", meaning that internet freedom in the country has deteriorated in the past few years, given that in 2013 it was ranked as "Free". Moreover, the entire telecommunications sector has suffered due to economic hardships in the country and its tumultuous relationship with Russia. Therefore, several popular Russian platforms have been blocked, including popular social networks such as VKontake and Odnoklassniki. The Internet penetration rate is currently estimated at 52.5% and has been constantly growing in Ukraine. Access to the internet remains affordable for most of the population and state-owned providers no longer dominate the market. However, rural areas are still far behind in terms of the internet access. While almost 80% of people who live in cities with over 500 thousand inhabitants are connected to the internet, that number drops to 51% in villages and 60% in towns with a population of less than 50 thousand. As of July 2018, the most popular search engines in Ukraine by market share were Google (89.62%), YANDEX RU (7.09%), Bing (1.06%), Mail.ru (0.95%), Yahoo! (0.71%) and DuckDuckGo (0.38%).

E-commerce market

E-commerce is gaining popularity in Ukraine, but it still represents only a small share of total retail sales. In 2017, nine out of ten internet users shopped online at least once. About 13.6 million people visited e-commerce websites and 3.7 million shopped online. On average, each person spent US$ 334 on online purchases that year. The Ukrainian e-commerce market was estimated to be worth around US$ 1.78 billion in 2017,  but no official data was released. If that number is confirmed, that would mean an increase from the estimated US$ 1.37 billion market value in 2016. The preferred payment method in the country is cash on delivery. As for online purchase methods, two thirds of e-commerce visitors use mobile devices to access the Internet, and only 33% of them do it through a computer or laptop.

Social media

The Ukrainian government has been working on breaking with its Soviet past and reorienting itself towards the West. That is why, in 2017, a ban on several Russian-owned internet companies was announced by the government. Two major social media platforms in the country, VKontakte (VK) and Odnoklassniki have been banned as they were said to be a risk to national security, given that they were supposedly used to spread Russian propaganda against Ukraine. Ukraine's internet is classified as 'Partly Free', which means that people could get in trouble for expressing their opinion on social media. There have been cases of social media users being imprisoned for expressing views deemed threatening to Ukraine’s territorial integrity. However, social media are still popular in the country, with almost half of the population using them. As of July 2018, the most popular social media networks in the country by market share were Facebook (40.68%), YouTube (17.26%), Twitter (14.6%), VKontakte (12.86%), Instagram (9.08%) and Pinterest (4.27%).