Ukrainian eCommerce: Time to Move Beyond Survival Mode

Hi there!

I'm Eugene Oblog, CEO of Magecom. For over 12 years, I’ve been working at the intersection of investment banking, international sales, eCommerce, and strategic management. I’ve contributed to the development of dozens of projects across the US, Canada, Europe, and Ukraine, from drafting initial models to delivering pilot batches, from launching MVPs to building stable teams of 100+ specialists.

I’ve been involved in creating new brands, helping legacy businesses take their first steps in digital transformation, leading change strategies, and entering new product and geographic markets. My experience spans investment funds, brick-and-mortar industries such as heavy machinery and metallurgy, product IT companies, and outsourcing, all within the realm of eCommerce.

What interests me goes far beyond the technical implementation of eCommerce solutions. This article offers a reflection on business architecture, encompassing processes, analytics, team building, branding, and growth. I invite you to join me in this reflection in the comments.

Over the past 15 years, Ukrainian eCommerce has evolved from a hipster experiment to a fully-fledged industry. If you recall the wild west of Kyiv’s early internet providers, such as Volia disconnecting users without notice, the boom of tiny ISPs, verbal contracts made via cold calls, or the first social networks and the timid attempts to enter credit card numbers into sketchy-looking online stores, you’ve witnessed this transformation.

Today, we see brands that started from a balcony in 2014 and now sell across 7+ markets. At the same time, there are companies that, despite having a product, a team, and advertising, consistently fail to cross the $100K monthly revenue threshold.

This isn’t a text about optimism or criticism. It’s an attempt to view the e-commerce market through the eyes of a leader who works on projects in Ukraine, Germany, the US, Canada, and the UK. To see where we are strong, and where we’re holding ourselves back from scaling.

Market Snapshot: Key Facts in Brief

• In 2022, the Ukrainian e-commerce market was projected to reach $4 billion; however, due to the war and widespread economic shock, the actual volume dropped sharply to around $300 million. [link]
• However, in 2023, the market rebounded, reaching approximately $4.5 billion. [link]
• According to data from Promodo, nearly 10 million Ukrainians made online purchases in 2023, with 1.5 million of them making their first purchase online.

• In 2024, the market reached $6.86 billion [link], with a projected compound annual growth rate (CAGR) of 8.6% from 2025 to 2029.
  A study by Promodo, published in September 2024, confirms a positive growth trend in the Ukrainian eCommerce sector, despite a decrease in average order value. The top-performing product categories include:

• Clothing & Footwear: Leading in sales volume due to a wide assortment and the convenience of online shopping.

• Cosmetics & Perfumes: This category is gaining popularity thanks to active brand promotion on social media and growing consumer interest in self-care.

• Electronics & Home Appliances: Persistent demand for smartphones, laptops, and gadgets keeps this category among the top.

• Baby Products: A rising birth rate and greater parental focus on quality contribute to this segment's growth

• Home & Interior Goods: Increased time spent at home is driving demand for furniture, decor, and lifestyle items.

• Ukrainian export-oriented eCommerce brands, operating via Shopify and marketplaces, are expanding toward markets such as the USA, Germany, and Poland.[link]

The Main Challenge: Scaling.
We often hear about successful Ukrainian brands entering the US and EU markets. However, behind them are thousands of businesses struggling to reach the $30,000–$ 50,000 monthly revenue threshold. The issue is not a lack of ambition, but rather systemic barriers that entrepreneurs face daily.

The main reasons include:

Limited resources
Most companies don’t have extra budget for testing hypotheses, exploring new channels, or hiring additional staff. It’s often a choice between advertising or packaging, a new employee or paying the rent. This slows down progress.

Intense competition
There are no “easy” niches left in Google Ads or Meta. Even a great product won’t succeed without a budget. The ones who survive are those who can afford experimentation and sustain a high customer acquisition cost (CAC).

Complexity of entering international markets
Logistics, taxes, local services, customs procedures, and marketing in another language all of these require not just funding but expertise. Often, a company simply lacks someone who knows how to “bring a product into the EU.”

Lack of experience and systems
SMEs often grow chaotically, driven by the energy of their founders. But when it comes to managing teams, KPIs, cash flow, and taxation across three jurisdictions, everything stalls without a proper system. Not because it’s impossible, but because it’s unclear where to start.

What We Do Well

Ukrainian Engineers
Why has there been such strong demand for Ukrainian developers over the past 15 years, aside from the simplified tax regime and the practice of hiring through sole proprietorship FOP (individual entrepreneur) contracts?

Ukrainian engineers are rightfully considered among the best in the world. This is the result of a historically strong engineering tradition and a disciplined educational approach. Ukraine has maintained a deep-rooted system of technical education with a focus on mathematics, physics, and programming. A strong university foundation (shout-out to KPI) with fairly high academic standards, combined with an unstable economic environment and a drive for self-realization, has produced a generation of engineers capable of solving complex problems with precision and systematic thinking. In recent years, we can also add mental resilience, unfortunately.

From my own experience working with teams in Europe and North America, Ukrainian developers are not only technically advanced but also stand out for their sense of responsibility and initiative. For us, it has always been essential to communicate in English, understand the business context, and work independently.

On the other hand, Ukrainian engineers were among the first in Ukraine to understand their own value and actively seek remote opportunities in markets with high demand and strong purchasing power. This is not a disadvantage but a strength; it creates a solid base of experienced professionals. It also raises the entry barrier for service providers, but more on that later.

Ukrainian Service
Amid the war, we once again heard about the high level of service in Ukraine. The public sector, service industry, and consumer goods market are highly digitalized and personalized. The market is used to a high and engaging level of service. There is no need to teach users how to use an app for booking; this is a basic expectation. However, this also creates demands. The app must be well-designed, user-friendly, and, most importantly, meaningful, because users will simply refuse to install “just another app.” With great power comes great responsibility, as the saying goes.

Our teams know how to build great solutions. Starting with the well-known Diia app, we see success in fields like robotics with bionic prosthetics, growing capabilities in AI and ML, and impressive results from teams like Reface, Grammarly (an English writing assistant), People.ai (an AI-driven sales analytics platform), Preply (a marketplace for online tutoring), Liki24, and others.

We are also seeing the rise of outstanding eCommerce brands and platforms that are setting global trends. Companies like the EVA Group, Prom, Rozetka, and makeup.com.ua, along with a whole new wave of strong young brands such as Zhilyova, Cultnaked, and Bettter, are driving the future of retail and Ukrainian eCommerce forward.

High Adaptability

Ukrainian entrepreneurs operate in an unstable environment. Even before the war, both the full-scale invasion and the events of 2014, and even before the first internet providers appeared, Ukrainian businesses had already learned to function under crisis conditions. Or more precisely, in all-weather conditions.

Adapting to a constantly changing environment is a kind of superpower for Ukrainians and for our entire market.

This is an advantage that should be understood and leveraged. The scenario “traffic dropped → budget reallocated → offer changed → website updated → campaign relaunched” typically takes us just a few hours or days. Elsewhere in the world, it could take weeks.

Flexibility in decision-making, low-code and custom solutions, and real-time A/B testing are the things that drive competitive advantage.

I once trained for one of my first Race Nation events, and Yurii, the founder, always used to say: you have to recover while running, without stopping. That’s exactly what our entrepreneurs know how to do.

What Holds Us Back

We are capable of a lot. But there are structural issues that consistently prevent Ukrainian eCommerce from scaling. I’ve seen this in both local businesses and in projects with global ambitions. Here are some of the challenges we repeatedly encounter.

eCommerce Without a System Is Not a Business

Often, eCommerce in Ukraine (and not only here) begins as a passion project: a visually appealing design inspired by references, a website goes live, traffic starts coming from Instagram, there’s a product the founder and customers like, maybe it even goes viral. Sounds like a business? Unfortunately, not yet. It’s a great start, and a dream is essential, but that alone doesn’t make it a business.

eCommerce, like any other business vertical, requires a clear and scalable architecture. Without it, growth breaks the company instead of strengthening it. As the workload increases, the lack of structured processes, automation, financial control, and a responsible management framework leads to chaos.

eCommerce, as a system, is a set of interconnected modules. Architecture matters.

Technical Architecture

The platform is the foundation. Whether it’s WooCommerce, Shopify, Magento, BigCommerce, or a custom solution, it doesn’t matter if it can’t:

• scale without interruptions (traffic spikes, new markets, expanding SKUs),
• integrate third-party services (CRM, ERP, analytics, email platforms),
• quickly update content and launch campaigns.

The platform should match not the business size today, but the ambition for the next 2–3 years. Otherwise, you’ll face refactoring within a year, incur technical debt, and derail your growth plans.

Logistics and Inventory Management

An eCommerce business that doesn’t track inventory, delivery timelines, product damage, and logistics costs loses money. High LTV begins with a solid delivery experience and complete control over inventory (in-house or via fulfillment partners), supply (including reorder points and demand forecasting), and return and claim tracking.

I know the world isn’t built on turtles and whales, but on Excel spreadsheets. Still, moving beyond Excel and building real-time data integration with an ERP or WMS is essential.

Finance and Cash Flow

Lack of cash flow control is the number one reason eCommerce businesses fail after their first attempt to scale. It’s the main reason small businesses fail in general. Founders often know how much is “left in the account,” but not which channels generate profit, which ones burn cash, which SKUs drag down overall performance, or when a cash gap will hit.

Only daily (!) cash flow tracking, a forecasted P&L, and a solid unit economics model can ensure sustainability. And this is not about “hiring a CFO”, it’s about having the right founder mindset.

Analytics and BI

Having GA4 or a Meta Pixel set up is a good start, but it’s not a comprehensive analytics solution. Ideally, a business should be able to view channel-level funnels (acquisition, retention, and churn), segment-specific lifetime value, product category margins, and personalized campaign performance.

Gut feeling is helpful at the MVP stage. However, once you start to scale, running without data is akin to gambling; you might get lucky. If you don’t, you need to act based on facts.

There’s a joke (not a joke) that the most expensive consultants usually get paid the most to tell you to spend less and earn more. Analytics is your tool to answer the question “how?”

You don’t need to overcomplicate it. In most cases, until you reach $5–7 million in annual revenue, you don’t need Power BI. Many platforms already offer integrated analytics, there are SaaS tools, and vendors that can help you set up reliable data tracking. This is the direction you need to move in, constantly improving your results.

A Team with Clearly Defined Roles

Many Ukrainian eCommerce projects start in the “everyone does everything” format. This is natural in the early stages of development: the founder writes the copy, launches ads, answers phone calls, processes orders, and sometimes even packs the products themselves. A small team covers the entire cycle, and that’s perfectly fine when your turnover is around $10,000 to $30,000 per month.

However, once the company reaches a monthly revenue of $50,000–$ 100,000, this model begins to break down. At lower scales, the chaos is manageable, but with every new SKU, every new marketing channel, and every new sales region, that chaos turns into a crisis. There is no delegation, tasks get lost, and priorities become blurred. Worst of all, there’s no accountability: when something doesn’t work, no one knows who’s responsible.

At this point, businesses often rely heavily on individuals. There’s someone who knows how to handle marketing or PR because of their network or personal talent. But such individuals can’t be scaled, and without a system in place, it becomes impossible to integrate or replace them.

That’s why successful eCommerce businesses don’t grow on enthusiasm alone, they grow on structure, with clearly defined areas of responsibility where everyone knows:

• What exactly they are doing,
• What result they are accountable for
• and what KPI their work is measured against.

It’s important to understand that business “stars” are essential. They should lead teams, set goals, inspire those around them, and burn with passion. But they must also be able to play by the rules and help build the structure that enables the business to achieve those goals.

Structure allows a business to scale horizontally across categories, markets, and channels without losing focus, control, or quality.

Core Functional Blocks in an eCommerce Team

🔹 Growth. Focuses on expansion by testing new channels (TikTok Ads, influencer marketing, and new geographies), experimenting with pricing and offers, conducting A/B testing, optimizing conversion rates (CRO), and launching minimum viable products (MVPs) for new verticals. This team drives momentum and is responsible for scale and velocity.

🔹 Retention. Focuses on repeat purchases: email marketing (Klaviyo, Omnisend), loyalty programs, SMS campaigns, abandoned cart recovery, and referral mechanics. Their key performance indicators (KPIs) include lifetime value (LTV) and purchase frequency. This is the team responsible for monetizing the existing customer base.

🔹Customer Success. Builds trust proactively by helping customers before, during, and after the purchase. Resolves issues, gathers feedback, and improves internal processes based on real user input. High-quality service is now a competitive factor on par with price.

🔹 BI / Analytics. The function that makes decision-making data-driven rather than intuitive. This team builds dashboards, models, and forecasts; validates hypotheses from the growth team; and creates a clear picture of what is working and what is not. BI is the business’s eyes.

🔹 Product Management. Where business meets technology. Responsible for roadmaps, prioritization, aligning functionality with user needs, and working closely with developers. PMs decide what we build, why we build it, and how it fits into the bigger picture across the website, app, or CRM.

🔹 Operations Team. Keeps everything running: logistics (shipping, warehousing, returns), procurement (supplier management, product assortment), customer support, legal (contracts, customs, taxes).

Depending on your business model, this may also include production, wholesale, or multi-channel sales; however, the list above provides a strong core setup for any e-commerce operation.

Customer Experience (CX)

Let’s be clear, users are not just “traffic.” They’re people with habits, expectations, doubts, and decision-making influences. In eCommerce, CX should be built into the system architecture from the start:

• UX/UI: The site should be fast, intuitive, and user-friendly.
• Onboarding: It should be clear how to buy, return, or contact support.
• Post-purchase: Transparent delivery, proactive communication, follow-up.
• Support: Problem-solving shouldn’t happen “via DMs,” but through structured live chat, phone, or email — with defined SLAs.

Marketing as a System, Not Just “Facebook + a Promo”

I often see marketing reduced to a set of technical tasks: running Meta ads, posting a certain number of stories per week, and offering weekend discounts. This can work for a while, but inevitably hits the limits of the small bubble it was built for. This approach provides a substantial initial boost, especially when paired with excellent service or a high-demand product, but it does not foster sustainable growth.

Marketing is a system. And if you don’t build it as such, your business will eventually stop growing and start struggling to survive.

You need to create a multi-layered mechanism where every component helps maintain focus on both the customer and the business goals. Think SEO, content, partnerships with opinion leaders, and even occasional collaborations with competitors. This isn’t just about “driving traffic,” it’s about creating a steady flow of people who know exactly why they’re here.

That’s when performance marketing comes into play: Google Ads, Meta, TikTok, retargeting, A/B testing. But this is just the tip of the iceberg.

Proper marketing isn’t about the first purchase; it’s about the second. And that’s where retention takes over.

Email campaigns, audience segmentation, helpful and timely triggers, all these build trust. At this point, it’s no longer advertising, it’s communication. And no brand survives long without it.

Content deserves a section of its own. I’ve seen a single, well-written article continue driving sales for 12 months, long after the paid ads stopped working. At the same time, a YouTube video featuring an expert opinion from a CEO can elevate a brand to a level where trust is established before the customer even clicks on the website link.

And of course, there’s a brand. Not just your logo and colors (though those matter too), but the answer to the question: Why should people trust you? If you haven’t answered this question through your actions, tone of voice, design, case studies, and storytelling, you don’t have a brand; you just have a website.

Finally, but critically, comes measurement: CAC, LTV, ROMI. If your business can’t confidently identify which channels are profitable and which just seem to work, you’re not managing your marketing, you’re watching it. The following phrase you’ll hear is often “our customers have no money” or “we’re targeting the wrong audience.”

Marketing as a system means building processes that function regardless of seasonality, algorithm updates, or the founder’s mood. Think of it as infrastructure, a system of scalable marketing assets that grow with your business.

The Urge to Cut Costs on Everything

Today, running an eCommerce operation is comparable in cost to running a physical retail business with proper infrastructure. In financial planning, website development costs are increasingly being treated as capital expenditure (CapEx).

Of course, many great startups begin in a proverbial garage fueled by a dream and a desire to make the world better. And when a product or service passes the early tests, and the founder’s energy is enough to deliver results, it’s time to move out of the garage. Imagine Apple or IBM never leaving their parents’ homes to build their ideas.

Bringing that comparison back to today’s eCommerce reality, leveraging a personal brand and selling products through Instagram influencers is a fantastic start. Making sales through Instagram and Meta is also great.

But relying on a friend-of-a-friend designer for your branding, and a developer who will “throw together a free website,” is a direct path to failure.

You must understand that building an e-commerce brand presence, both in terms of money and time, is comparable to opening a network of physical stores. That is, if you're aiming for quality.

Choosing the right platform to meet your business needs is relatively easy and should be treated as a key business decision. Analyze cost-efficiency, security, scalability, integrations, and analytics capabilities. Start with the usual suspects: WooCommerce, Shopify, Shopware, Magento / Adobe Commerce, BigCommerce, or begin with no-code builders like Squarespace and Wix eCommerce.

Create a prototype, estimate the cost of implementation and maintenance, and take an honest look at the development process.

Depending on your business structure, develop a proper eCommerce architecture:

• Integrate with a PIM system if you have an extensive catalog or operate across multiple channels.
• Connect to an ERP system if you have your own production or large warehouses.
• Consider motivation systems for sales reps that can be directly integrated into the eCommerce workflow.

From the very start, factor in technical SEO, optimized content, localization, mobile traffic experience, and customer journey testing.

Don’t forget the world we live in now. With AI Search from Google, AI Mode, and ChatGPT-powered Shopping Assistants, your product category can be discovered through AI recommendations, and users may land directly on a product detail page (PDP).

That means your PDP may become the first and only page a user sees and needs to include information traditionally placed elsewhere: company details, trust indicators, fulfillment guarantees, and more. That’s not just for the customer, it’s also for the AI crawlers.

To wrap this up: if your eCommerce presence was built using “whatever was available,” without specialists or investment, what you have isn’t a boutique. It’s a flea-market stall with outdated design and no street presence.

Fear of Experimentation / Lack of Continuous Growth

When a particular channel or tool starts working, some businesses freeze; they stick with what works and avoid change for as long as possible. This is understandable in a climate of instability. But eCommerce brands can’t afford to stay in their comfort zone. In digital, nothing lasts forever. What works today may stop delivering results tomorrow. Algorithms change. User behavior shifts. Platforms lose relevance. What was once a growth driver becomes a burden.

A brand that’s afraid to test new channels, ad formats, or customer engagement models is choosing stagnation. Avoiding TikTok because “it’s for kids,” dismissing Pinterest because “our audience isn’t there,” ignoring email marketing because “no one reads emails anymore,” and then being surprised when competitors catch up and overtake you.

The market is a flowing river: if you’re not moving forward, you’re being pushed backward. Experimentation with marketing channels and personalization tech is a necessity. You don’t need to pour tens of thousands into every new hypothesis. But you do need a validation process. Test → Measure → Learn → Scale or Kill — this is a good practice worth adopting.

Even if Instagram is performing, you can’t rely on it alone. Audiences age, migrate, and change behavior. If you're not testing YouTube Shorts, Twitch influencer collaborations, or other integrations, you’re voluntarily cutting yourself off from new customer sources.

Today, eCommerce is not a channel; it’s an ecosystem. You must constantly check what works best: video or UGC, long-form or short-form copy, Facebook or Reddit, push notifications or SMS. Stay informed, look at the data, and have the courage to try. Don’t fear failure, fear standing still.

Beyond Ukraine

When discussing growth, we cannot limit ourselves to the Ukrainian market. It’s a great starting point, but if you want to build something truly large-scale, you’ll need to go beyond.
I regularly work with eCommerce projects in the U.S., Germany, Canada, and the UK. Each market has its own dynamics, challenges, and unspoken rules, things you need to understand before taking your first step.

Germany is driven by convenience. If your website loads slowly, is poorly translated, or lacks a local language version, users are likely to leave. Stability, compliance, and clear expectations are paramount. If you promise two-day delivery, it must be delivered in two days. Trust takes time to build and can be lost in seconds. In Germany, UX is not just design; it’s part of your brand reputation.

**Canada **is heavily influenced by content and brand narrative. People often buy not just the product, but the story behind it. As in many countries, sustainability, ethical production, and a local focus are practical here. I’ve seen small brands with clear missions earn massive support simply by being transparent and sincere. If a business speaks the truth and lives its values, people believe in it, even in saturated markets.

The UK may seem reserved, but the market is very open to new formats. Yes, competition is intense, but so is the willingness to try new things. You need to understand tone and nuance, and avoid overplaying the American salesy tone. Brits value precision and intelligence in communication. If you sound authentic, not artificial, you’ll be heard. Social proof matters: reviews, media mentions, expert endorsements. Expertise outperforms any discount.

The U.S. is a different universe; everything is fast, loud, and expensive. The supply is infinite, the demand is deep, and the economy runs at full speed compared to Europe. But it’s also the best place to stress-test your business model. I’ve worked with multiple teams entering the U.S. market, and most had to overcome the illusion of “figuring it out along the way.”
Entering the American market is a significant and complex task, and typically, the winners are those most prepared to work for it. Running a business “for the soul” won’t cut it, but the reward can far exceed expectations.

All these countries are different, but they share one thing in common: without localization, nothing works. Language, currency, payment methods, delivery services, tone of communication, and even website color schemes must align with local expectations. I’ve seen strong Ukrainian brands lose sales simply because they left the checkout in English or didn’t display prices in the local currency. The buyer must feel they are buying from someone who understands their context and culture, not from a “foreign” project.

So if you're planning to expand, don’t start with advertising. Start with adaptation. Consider your product from the perspective of someone in Berlin, Toronto, or Manchester. If that person doesn’t understand who you are, what you offer, or how it works for them, there will be no sale. And even the best Google Ads campaign won’t help.

So What Now?

We’ve all heard that building a system is key, and yes, it sounds great, but what does it mean in practice? The most significant value rarely comes from vague advice. It comes from concrete things you can start doing every day. So I want to share what works, based on what I’ve seen in businesses that successfully leveled up.

The first step is building a model. I always recommend that founders get the business out of their heads and onto paper (or into a spreadsheet). Not vaguely, but break it down: finances, channels, customers, product, team, processes. Map out how things currently work, and how they should work six months from now. This isn’t a document for investors. It’s a management tool. The most successful companies update their model not once a year before a pitch, but monthly. It helps them identify market changes, internal slowdowns, and areas where they can improve.

The second step is brand. And I don’t mean the logo or the font. I mean answering fundamental questions: Who are you? Why should people trust you? Why should they choose you among hundreds of similar stores? If your business doesn’t tell its story, that silence tells a story too, through action or inaction. A strong brand builds trust, provides context, and enables you to sell not just a product, but a meaning. And it’s meaning that drives repeat business today.

Only third comes the technology. In eCommerce, the platform is the skeleton of the entire operation. If it doesn’t allow you to scale or quickly update your site structure or launch new channels, it’s holding your business back. You must be prepared to invest in a robust platform, integrate with CRM, email marketing, and ERP systems, and select tools that build a solid infrastructure that won’t limit your growth tomorrow.

I always look at how quickly a team can make changes on their own, how fast they access analytics, and whether there’s real control over data. Good tech isn’t “expensive”, it’s flexible and innovative. And it should match not only today’s needs but tomorrow’s ambitions.

My Takeaway

Ukrainian eCommerce is no longer playing in the sandbox. We’re done testing if online sales “can work.” They do work. We already have teams, brands, technologies, and our products. What we don’t yet have is a consistent system. And that’s exactly where I see our most significant opportunity.

I believe we have enough talent, engineering discipline, creativity, and entrepreneurial energy to build not just shops, but sustainable, serious businesses. To shift from thinking about “what can we sell this Friday” to creating a year-long strategy. To scale not just ad budgets, but the systems that hold the company together. Where structure appears, strength follows. And with strength comes potential for global growth.

The next three years can be more than just another wave of online shops. They could mark the moment when global leaders emerge from Ukrainian eCommerce. Companies that don’t just sell on marketplaces, but set trends, create new niches, and shape what the market becomes.

P.S. Everything I shared in this article is not theory. It’s based on real work with real teams, real products, and honest mistakes. And I’m still learning, too. I intentionally left out topics like team building, motivation, and eCommerce organizational structure; they’re massive topics on their own. But if you’re interested in diving deeper, let’s talk. Leave a comment or message me directly, I’d be happy to continue the conversation.