“Sberbank ecosystem” — the phrase has become familiar, and it was forgotten that a deep thought was to transfer the term from ecology to the business sphere. One way or another, about 50 non-financial companies are grouped today around Sberbank as a holding company, providing more than 100 services. They cover all popular areas of Internet business: e-commerce, taxis, car sharing, food and food delivery, entertainment, b2b-services and, of course, financial products.
History of the idea
German Gref often brought ideas for his reforms from foreign voyages. For example, in 2009, he visited Toyota and began to introduce practices characteristic of this company such as internship of bosses in the places of subordinates and “five minutes of creativity.” And a few years later, Gref “opened” the season of all-Russian fashion for agile. And once Gref tied the bonuses of top managers to their success in weight loss.
So the trips of top managers of the bank to Silicon Valley have become regular. And against this background, top managers of Sberbank began to look at the successes of IT corporations, creating large lines of related services around them. We emphasize again: the idea of creating an ecosystem came to Sberbank not from the banking sector. An example here were such companies as Amazon, Apple and Alibaba.
If you collect public statements made by German Gref and other top managers of Sberbank about the creation of an ecosystem, the next logical chain is built.
The leadership of the country’s main bank does not believe in the prospects of traditional banking. In 2016, German Gref said that traditional banking “has no future”: it is “risky and uncomfortable.”
“For a long time, Sberbank has actually monopolized the banking services market, — notes Dmitry Salatov, co-founder of the Blank Business Bank, — given that this market is practically not growing, the obvious decision was to capture other verticals that are not directly banking business, but occupy a significant place in the lives of Sberbank customers.”
Sberbank management highly appreciates the prospects of marketplaces and ecosystems of IT corporations and believes that it is only possible to increase the growth rate of capitalization of their bank by betting on this segment. In April of this year, Gref said that he would never have received the profitability in the banking sector that Sberbank — potentially — receives from the growth of the share capital of its Internet services, which are rapidly increasing their market share.
An additional motive was the threat that IT corporations themselves are part of the financial and banking services segment and can squeeze out traditional banks. The best way to defend is the offensive: if IT corporations invade the financial services sector, the bank itself should become an IT corporation.
“In 2014, Apple Pay was launched, 2015 faced start of Google Pay, from that moment IT corporations launched an attack on the banking sector, where conservative views prevailed at that time, — comments the founder of the service, promkod.ru Andrei Priobrazhensky, — in 2015 the online company Revolut was founded, which today offers traditional banking services, and is actively developing the direction of cryptocurrencies. The above events became the main motive in the creation of the Sberbank ecosystem”.
In 2016, Sberbank began to work out the concept of creating its own ecosystem, and, as Kommersant became aware, it was Alibaba Group that was paid special attention in the internal Sberbank document. Here it is worth adding that, in addition to all these publicly expressed reasons for the creation of the ecosystem, there was another one, perhaps not fully understood by management, or rather, realized for granted and therefore not voiced. Sberbank was simply forced to take decision to create its line of various businesses by the fact that the bank has a lot of customers. More than 90 million Meanwhile, in our time, the most scarce resource is human attention.
The main thing is the clientele
In the twentieth century, management specialists found that a multisectoral corporation is not the most effective structure: it is better to focus management efforts in the field of its greatest competencies. However, the “calculations” of the last century were blocked by a new factor: the presence of a ready-made customer base. It is necessary that millions of potential customers already have a reason to visit this site. And therefore, new families of services arose, maybe not only around technology owners, but primarily around those structures that had a multimillion-dollar client, from electronics manufacturers (Apple, Samsung), Internet trading sites (Amazon, Alibaba, Ozon), and social networks (Facebook), to messengers (Wechat, Telegram), and search engines (Google, Yandex).
A high level of technological competence and a large audience are two equally necessary requirements for an organization that has decided to become the “crystallization point” of the future ecosystem.
It is clear that Sber would like to profit from fashionable network businesses, instead of rotting along with old-school banking, but is there any benefit for the businesses themselves? Is there any notorious synergy? Why should businesses form around the bank? Of course, for the bank itself, this is profitable.
“The key moment is concentration of money that makes the ecosystem self-sufficient, — the founder of TalkBank fintech platform Mikhail Popov considers, — in the long term it allows to strengthen a financial leverage of a system as money doesn’t go beyond one ecosystem. This allows you to increase turnover, since in fact, less external borrowing is required to administrate these cash flows. They are better predicted, better understood in terms of cash reserves, and better disposed of. The return on the use of capital is greater, in general, financial metrics are improving. However, it is clear that this is in the future, and at the start you get huge costs. Including due to a conflict of interest between the bank and affiliated structures, which could earn more independently, using, for example, other banking services on other terms“.
An important factor is the same giant clientele of Sberbank. Senior Vice President of Sber, Head of the Directorate for Ecosystem Development Andrei Vanin, in one of his interviews, talking about the rapid growth of the audience of the Sbermarket service (formerly Instamart), noted that the service could never achieve such success on its own, since before Sberbank he had “neither a regional network for quick distribution, nor a strong brand behind his back.”
In addition, Sberbank is developing a system of so-called “enablers,” that is, end-to-end unionists of different businesses. Vanin calls primarily four enablers: brand, common user ID, common contact center, common security system. We would add a single subscription here. However, a single contact center is a dubious, typical case of reducing costs by reducing quality: as Kirill Bulgakov, managing director of Technoserv Consulting, wrote, the typical lack of ecosystems is the bureaucratization of communication with the consumer. As for the Sberbank brand, is this brand so important in marketing?
“Sberbank, although it tries sometimes, still cannot afford to drag all services under its own brand. This has its own reasons, — says Dmitry Salatov (Blank), — firstly, this requires a strong brand that consumers trust. Many still associate Sberbank’s logos with bureaucracy, poor-quality service, unfavorable conditions — all those who do not want to choose. Secondly, you need to have the strongest food competence, which will allow you to really combine products, and not just change the sign. So far, the market looks like Sberbank is not able to build superapps and make successful products by internal teams. For example, “SberMarket” has been working for more than a year and has not yet even closely competed with “Lavka,” “Samokat” and other players in this market. At the same time, Okko, existing under a separate brand, significantly squeezed out other online cinemas from the market“.
Looking to the Future
The plans announced by Sberbank come down to an increase in the share of non-financial businesses in revenue — up to 5% by 2023, up to 30% by 2030 — in the hope that as a result of the growth of the market share of these businesses, the total capitalization of the group will increase. According to Mikhail Popov (TalkBank), if Sber now focuses on e-commerce, then in the future Sber will develop media content more and more, as this allows attracting and retaining the younger generation of customers; in addition, related services such as delivery and taxis will be intensively developed, as they are infrastructurally important for the successful operation of e-commerce services.
“The success of food marketplaces directly depends on the speed of delivery of products. Therefore, Sberbank will invest heavily in the development of such infrastructure and the company’s related services: they improve these indicators and serve such service organizations,” — said Mikhail Popov.
And, given the financial capabilities of Sber, its investments in logistics can raise questions not only from the Central Bank, but also from the Federal Antimonopoly Service.
A conceptual question arises about the future of ecosystems. Theoretically, Sberbank would like to become “everything” for its client: a universal concierge — a supplier of any goods and services.
“By creating groups of various companies around the main banking group, Sber is trying to solve the problems of comprehensive customer service (and not only banking customer)…,” — said the dean of the law faculty of the Financial University under the Government of the Russian Federation, Professor Gulnara Ruchkina.
According to Dmitry Salatov (Blank), most likely, in the near future Sberbank plans to revolutionize its banking application. Sberbank should turn its app, which is used only for transferring money, into a daily application for each client. And then Sberbank can close the consumption of most everyday goods and services to this application.
“With such a strategy only, Sberbank will be able to compete with Yandex ecosystem, which already allows seamless transition between various services without opening any other applications and sites, — the expert believes, — by creating such a platform, Sberbank will be able to solve the main problem of its ecosystem — to make it consistent and tie its customers not only to banking services, but also to all Sberbank services at once. “
In fact, Sberbank would like to replace the Internet for its clients. Meanwhile, in the modern world, in most cases, the gateway to the Internet, the entry point, is not a bank, but a search engine, social network, postal service, or messenger. From this point of view, Sberbank needs to have its own messenger or search engine. However, entering this business is too difficult — although Sber has already acquired Rambler; the task is simple — to return the former greatness to the once main Russian search engine. As a result, will Sberbank’s ecosystem come across the well-known fact that multidisciplinary holdings are less effective than the totality of specialized companies and startups? And will Sber-type holding ecosystems not be defeated by open, vertically non-integrated ecosystems?
It is not for sure that in ten years messengers, social networks, search engines will have the same power as today. We do not know what will replace them, but we know that the main drawback of the most popular Internet resource in Russia is Yandex. It can find anything, but not the best. For those who are concerned about price and quality, searching for goods and services on the Internet is not an easy task.
Feedback systems are the only tool that allows the customer to navigate the supply world. Users today are in heavy need of some kind of expertise, ranking the products sold by price and quality — the last one is especially difficult. What does Sber have to offer in this regard? So far — only its brand, guaranteeing a certain level of quality, but it is impossible to be always the best, especially if you are a giant corporation with all the associated problems.
It seems that, having brought its non-financial business to certain scales, Sber will face the need either to divide its group into parts, or to allocate and even sell its individual divisions.
Author: Konstantin Frumkin