Not many will remember the catchphrase: Get a pig and a bag, not a pig in a bag. Two people, however, look back on this attempt at marketing with nostalgia – and a lot of laughter.
George Chatzigeorgiou and George Avgoustidis are two of the three founders of the successful Greek online marketplace Skroutz – the third being Vasilis Dimos, a member of the board – and they recently spoke to Kathimerini about the 20-year journey from search engine to business group, about the mistakes made along the way, and about the new moves being planned in Greece and abroad.
But back to the pig: The motto, written in yellow and orange letters, appeared underneath the company’s logo back in 2005 when it was a search engine for comparing the prices at computer stores located on and around downtown Stournari Street, Athens’ electronics mecca at the time.
The idea to play with the English saying “buying a pig in a poke” – meaning to buy something unseen – belongs to Avgoustidis, Skroutz’s vice president and the brains behind the company’s marketing strategy. That modest company – named after the Greek iteration of the famous Disney character Scrooge McDuck, the penny-pinching millionaire of Duckburg – has now grown into a group that comprises an e-marketplace, a payment service and a delivery firm, with a staff of around 1,200 people and an annual turnover (for the companies in the marketplace) of, roughly, 980 million euros.
And it all started with Chatzigeorgiou – Skroutz’s president and CEO – and a hobby. “It hadn’t occurred to me to start a business. I was fresh out of university, a programmer, with a steady job, and developing a price comparison engine was just something I did at home in my spare time. I had no business plan, no financing and no stress, because it was just a game to me,” he tells Kathimerini.
“I started out with 12 stores and didn’t really feel like talking to anyone, so I checked out their websites, emailed them about what I was doing and asked them if they were interested in being listed. They all liked the idea, especially since it was free of charge. I guess I inadvertently tapped a gap in the market and the engine soon grew in size and popularity. It also started taking up a lot more of my time and I’d often find myself working through the night after coming back from work. That’s when I reached out to Vasili, the second co-founder, who was also a programmer. George [Avgoustidis] happened to be working at one of the stores on Skroutz and turned out to be a friend of friends, because it’s a small world here. He saw the value of what we were doing from the commercial side and came to me and said, ‘I don’t think you know what you’ve got here.’ It’s true that I hadn’t realized how valuable a tool it was for sellers; I thought it was only useful for consumers.”
Of course, for “around two and a half years we spent several hours a day on Skroutz and had to hold down other jobs to make a living. We basically bankrolled Skroutz from these other jobs,” says Avgoustidis.
There were no funds, venture capitalists and other such vehicles to fund a startup at the time. “Now you can go to the bank and get money from your investor. That’s both good and bad. You’re not taking the huge personal risk we were, but investors have demands because it’s their money on the line. Back then, the only angel investor you could hope to have was an uncle. And even that was not so common,” notes Chatzigeorgiou.
It is worth noting that in 2006, the publicly traded company Dionic bought a 50% stake in Skroutz, which the founders took back in 2018. “It was a partnership we could have avoided,” says Chatzigeorgiou.
‘We basically bankrolled Skroutz from [our] other jobs,’ remembers Vice President George Avgoustidis.
The next big step was taken in 2016, with the development of the “Skroutz basket.” It started with pharmacies and that became the stepping stone to the marketplace. “We didn’t like that we were losing the users, who went to the physical store. We were also getting complaints even though we had no part in what went on after an order was placed. Not to mention that we did not like how e-commerce worked and there were none of the classic infrastructures we have today, like the Last Mile, for example,” says Chatzigeorgiou.
“That’s when we said that either we’d make the investment ourselves to develop all of the necessary services and infrastructure, or we’d remain a price comparison engine, with little scope for growth,” he adds.
They pursued the first avenue and expanded with the buyout of the EveryPay payment service and the development of Skroutz Last Mile, which makes deliveries and is responsible for the Skroutz Points locker network.
The next milestone was in 2020, when the fund CVC bought 45% of the company. The fact that it was in the middle of the Covid lockdown when online sales skyrocketed was an unexpected boon. “We hit our 2023 targets in 2020; in just two weeks, in fact. Before the lockdown, we were getting around 400 orders a day. That shot up to 4,000 on the first day of the lockdown and rose exponentially every day after that,” says Avgoustidis.
The number of outlets working with Skroutz also rose from around 4,000 before the pandemic to 12,000 during it, dropping back down to 8,000 today.
Future plans
The Greek marketplace is now in the process of expanding, starting with Romania. “If we want to grow, we need to look at other markets,” says Avgoustidis, explaining that sellers in Romania will be able to sell their wares in the European Union via the Skroutz Marketplace and Greek sellers will be able to tap the Romanian market too.
Skroutz’s new investments also include a strategic partnership with car rental firm Avis Greece. The new marketplace, named Cardom.gr, will start by selling used cars and, if all goes according to plan, later expanding to new ones.
Developing the Skroutz Last Mile services is another important part of the company’s growth plan. The company currently has 1,900 Skroutz Points with more than 50,000 lockers and aims to reach 90,000 lockers by the end of 2026.
The network already serves third parties, including non-partner stores, currently handling around 1,000 orders per day.
“The locker network is essentially a national infrastructure. We are already using it for returns and the Scoop service (which facilitates transactions between private individuals), and we are also considering allowing parcel shipments through the lockers,” explains Avgoustidis. He adds that more supermarkets will be added to the marketplace, in time, beyond MyMarket and e-fresh.gr, which are already partners.
Last but not least, the group aims to expand its after-sales services, including providing technicians not only for installing electrical appliances but also for furniture assembly. Additionally, there are plans to offer financing options for partner merchants, a service that is currently being tested on a pilot basis.
Looking back on those 20 years, however, is there anything the founders would have done differently if they could turn back the clock to 2005?
“The deal with Dionic. We made a deal that didn’t benefit us or, at the very least, didn’t help us much and even put us in a difficult position,” says Chatzigeorgiou.
“I would do all the same, even the mistakes,” says Avgoustidis. “After all, the mistakes made us wiser.”