Outlook for Search and Online Advertising Market in Russia
Russian Internet sector is undoubtedly one of the most fast-growing sectors of the global web. Number of Internet users and amount of resources invested into internet-advertising is growing very fast.
General Overview. Basic Data.
By the end of 2006 number of Internet users in Russia turned 26 mln people and analysts foresee this figure to reach 30 mln people by the end of 2007. Yearly growth of number of people amounts to 13-20%.
By the end of the year the number of national domain names in .RU zone exceeded 700,000, growth worked out 61% per annum. It means that business actively perceives Internet as one of the strongest development instruments. A graph showing the growth of trade Runet audience
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- Weekly audience, according to Rambler
- Daily audience (working days), according to Rambler
- Monthly audience, according to POF (Public Opinion Fund)
Yandex (yandex.ru) is the leader in the Russian Internet market, which occupies 48.715% of the market. According to the results of the first quarter of 2006 Yandex share amounted to 51.8%, which means that Yandex lost 3.1%. Yandex’ offerings include web directory, search engine, (text & image), paid advertising/search (local), news, encyclopedia, shopping search, RSS search, online transaction system, games, and geographical maps. Yandex.Direct is its advertising program. The portal/search engine enjoys more than 50 percent share of the total Russian market. Yandex generates around 60 percent of traffic.
The
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For the period of 2006 Google increased its market share by 7.4%. Google established an office in Moscow, Russia, as a part of its global expansion strategy. The company intends to become a major player in the Russian Internet ad market. Improving the search capacity in Russian language is on the company’s list of future activities. Google enjoys an edge over domestic players in Russia, in terms of its offerings, including satellite images. The new office includes an R&D center.
Rambler lost 2.5% of the audience for the last year. Runet currently occupies only
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Some analysts foresee Google taking premier place at the Russian market in the short run.
Internet Advertising Market
In 2006 total Internet ad market volume amounted 237 mln USD in Russia (in comparison with the previous year the growth made up 87%). The sum includes:
Media advertizing - 87 mln. (dynamics growth - 42% per annum)
PPC advertizing - 102 mln. (dynamics growth - 155% per annum)
Search engine optimization - 50 mln. (dynamics growth - 60% per annum)
The source: Sha INTERACTION
Search Dominates Online Advertising Market
The search industry is an area of constant transformation. The Web’s widespread reach combined with the overwhelming growth of
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Apart from this, we should not forget about least popular today, but very perspective in the future, types of Internet advertising, such as social media optimization, viral marketing, hidden marketing. Those are not included into overall market assessment.
According to the forecasts of analysts, Russian Internet
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Fast Internet ad market growth is related with certain problems, as follows:
- Shortage of highly qualified specialists at the market which leads to fast growth of education market in the area of PPC companies’ management, search optimization, web- analytics.
- Absence of complexity of the provided services, limited number of companies providing wide range of services in the area of Internet marketing.
To our thinking, company will transfer from direct services sale to a consulting model in the short run. Analytics and consulting in the area of Internet marketing will
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Market Trends
There is a tendency of growth towards context advertising, its share has increased and forereached media advertising.
PPA models (Pay per Action) are introduced in context advertising, and virus marketing and video advertising implemented in media advertising. More attention is given to UGC-model (User Generated Content), when a user generates portal context by himself - social networks, etc.
Mobile search market is still not very popular; however, fast growth of wireless handsets popularity makes it a lucrative area with significant prospects.
Brief summary
1. Russian Internet sector is developing rapidly. Yearly growth of users amounts to about 20%, yearly growth of number of registered domain names amounts to about 60%.
2. The most popular search systems
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In 2006 total Internet ad market volume amounted 237 mln USD in Russia (in comparison with the previous year the growth made up 87%). The sum includes:
-Media advertizing - 87 mln. (dynamics growth - 42% per annum)
-PPC advertizing - 102 mln. (dynamics growth - 155% per annum)
-Sengine engine optimization - 50 mln. (dynamics growth - 60% per annum)
3. To our thinking, company will transfer from direct services sale to a consulting model in the short run. Analytics and consulting in the area of Internet marketing will grow.
Author:
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