How to Achieve a Success in Runet? Invest in Search Engine Marketing!

November 26, 2009

Many people say that search engines are the future of the business. If your company is not present on search engine ranking pages, most probably this will have a major influence on the profits, awareness and competitiveness. We search for business partners, suppliers and services in different ways and languages all over the world. These who are interested in the Eastern Europe market should have necessary pieces of information how to effectively reach through Internet their potential customers e.g. in Russia.

This article presents a summary of how the Russian (the fastest growing population of internauts all over the world according to comScore World Metrix, Jan 2007) look for information. It also explains the advantages of a good exposure in search engine listings in the Russian search engines.

Searching activity in the Russian Internet (known also as Runet) is concentrated in 4 major search engines. These are:

Yandex.ru – with 48,4% of market share;
Google – 28,6%;
Rambler.ru – 15,9%;
Mail.ru – 4,7%;

The other players (Yahoo, MSN, Aport, Meta Bot, Alta Vista and others) take the rest of the market, according to SpyLOG Feb / Mar 2007 stats – http://gs.spylog.ru/r/?reportId=7&categoryId=1.

Business promotes itself in Russia

As a result of intense development of Runet, not only the local SMBs spend money on PPC campaigns but also both international companies of the same size as well as big multinational businesses like General Motors, Nissan, Peugeot, Honda and Sony. In case of these companies, yearly advertising budget is between $1.5 mln – $3.5 mln with up to 50% of it being spent on search engine advertising in Yandex.ru.

Search Engine Marketing on the top

Due to the great interest among advertisers, 2006 expenses on search engine promotion in the Russian Internet grew by 150% comparing to year 2005 and reached $110 million. Thus, search engine advertising has beaten banner advertising (with $100 million spendings) first time ever. This should be a very important signal for all the companies which promote themselves online, that SEM activity (a mix of technology and words which allows to reach now more than 90% of internet users) is an optimum way of the promotion (Lenta.ru – http://lenta.ru/news/2007/02/12/advert/).

Optimum costs of promotion

The minimum price for a single click (CPC) in Yandex.ru varies from (depending on the industry) $0.50 (“stickers”) to $5.00 (“refridgerators”). In Begun.ru one can pay $4.00 (“cash terminals”), $5.70 (“sight correction”), $5.90 (“companies registration”) and even $6.20 for “company closure”. The highest prices ($9.99) are paid for targeted campaigns which take into account very precise parameters, geolocation and time restrictions. You can compare this to $1550 – $5000 prices of one week banner campaign on popular Russian portals (according to http://www.context.1ps.ru).

Investing money in paid listings should be then cheaper and undoubtedly more efficient. When talking about banners, one pays for impressions, not users’ interest measured by clicks and actions taken on the advertiser’s website. The opposite payment model is assigned to sponsored links – payment is made only for users interested in products and services who click and visit the website.

Competition among advertisers

The highest prices in Yandex.Direct (http://www.direct.yandex.ru) are related to B2B activity, where just one transaction (no matter if it is selling a drilling rig or Boeing) per year make a single click with CPC of $48.00 affordable. Apart from above-mentioned B2B examples, the most competitive areas of interest are flats’ sale in the modern block of flats, airplane rentals, Forex stock exchange and building industry services.

Why Yandex?

Coming back to the most important search engine in Russia… Yandex – not very well organized in late ‘90s, now is the leader of search engines in Runet. The company put an emphasis on contextual advertising and doubled its revenues last year, becoming even stronger player at the market. The management estimates that this year’ income from search-related advertising should be close to $100 million. At present, 25 million people use Yandex with 5 million of unique users every day. On the contrary, tens of thousands of companies conduct their promotional activity through this search engine. The constantly growing audience of Yandex makes more advertisers interested in both search engine optimization (being well exposed in organic listings) and PPC marketing (paid listings). They seem to make the right decision as the results come very quickly because of modern character of Yandex. Since 2005 it has had two advertising systems, comparable to Google AdWords and AdSense (according to Yandex official blog – http://company.yandex.ru/blog/).

Cheap listing better than expensive banner impression

Lew Glejzer, the director of AdWatsh advertising agency predicts that expenses on search engine marketing in 2007 will go over $200 million in total. All innovative companies that think about future take seriously into account paid listings – adds Dmitrij Wasiljew, Link.ru director. The banners are becoming more expensive and will probably be exclusively used by large companies while search engine marketing is affordable for SMBs as well.

“Key” keywords

In order to be completely successful one need to use precisely defined keywords – the ones which are both relevant to company business profile and are frequently used by people in queries made in search engines. The most popular queries between Dec 2006 and Feb 2007 were: papers (proceedings), desktop wallpapers, horoscope, postcards, weather, games, news, mp3, proverbs, dates, mobile phones, recipes, friendships, music, anecdotes, jobs, cars, predictions, sex, erotics, map of Moscow, chat, samsung d500, kamasutra, flats, photos, nokia, football, russian radio, lyrics, motorization, porno, pregnancy, Aeroflot (according to SpyLOG stats – http://gs.spylog.ru/r/?reportId=8&categoryId=1). Maybe this will be an inspiration for somebody when planning a ppc campaign on, let’s say, Yandex…

Who can see the advertisement?

Most of them are the Russian people – 44.4%, but the advertisement can be also presented to the Americans (14.5%), Ukrainians (4.7%) and Germans (3.5%) not to mention others. That is why search engine marketing in Russia gives the opportunities to reach people from different parts of the world. When talking about the Russian cities, there is one strong leader – the capital (Moscow) with 44% and other cities like Sankt-Petersburg (10.1%) or Jekaterynburg (2.6%), according to SpyLOG stats (http://gs.spylog.ru/rsu/?categoryId=1).

What are the benefits of search engine marketing?

Search engines are responsible for a significant traffic share on Russian websites. This is the result of good exposure in organic listings as well as paid listings activity conducted by Russian companies. The examples below present some traffic statistics on different sectors in the Runet in Nov 2006 (SpyLog stats http://gs.spylog.ru/tcu/5/preView/274.html).

Finance

Users monthly: 1 200 000
Traffic share:

57% – direct visits
32% – search engines
11% – other sources