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International Search Summit – San Jose Search
February 2012
2
Russian Internet market
Yandex overview
How it works
Get Stare
Agenda
3
Internet Users by Country
Internet Users (MM) per Country
Russian Internet Market
Russia has the 7th largest audience of Internet Users in the world; 2nd largest in Europe
Millions of Internet Users
4
Internet Penetration by Country
% of Population
Internet Penetration per Country
Russia currently has fairly low penetration compared to other large Internet populations
5
Russian Internet Penetration Growth
Internet Penetration in Russia (2000-2011)
Russian market is growing extremely quickly because of penetration growth
42%
2%
37%
27%
21%
19%
15%
4%7%
10%
12%% of Population
43%
Key Investment Highlights
Source: Public opinion foundation report, June 2011. Data for other countries provided by InternetWorldStats.com, June 2011, Dec 2011.
Internet penetration in Russia by Region (%)
66%
72%
53%
40%
Moscow Saint-Petersburg 1M+ Cities Other Russia
Internet Penetration in major cities is close to western standards
6
Internet users are concentrated in the western regions
7
8
Key Investment Highlights
Source: LiveInternet.ru
26%
8%
1.6%
5%
5%
26%
Search Traffic Share
Russian Search Engine Competitive Landscape
2006• Google opens office in Russia• Google introduces Russian
language morphology
60%58%
November 2009Launch of MatrixNet
January 2010Mail.ru stops using Yandexfor search
June 2011Rambler’s search services are powered by Yandex
7.9
9.6
11.8
14.6
2010 2011e 2012e 2013e
2%
5%
10%11%
13%
15%
18%18%20%
29%
UK China GermanyFrance US Spain Russia Italy Brazil India
9
The Russian Advertising Market Is Booming
Market Overview
Russian Total Ad Market ($ Bn)
10-13e CAGR: 23%
Online as % of Total Ad Spend
Paid Search (66%)
Display (26%)
Social (4%)
Video (4%)Mobile (1%)
Russian online advertising share by media type
10
2010 2011 2012$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
Source: Data Insight
Russian e-commerce(mln. USD)
Russian e-commerce has grown more than 50% in last two years
11
Mobile internet penetration is still relatively low
12
13
Russian Internet market
Yandex overview
How it works
Get Stare
Agenda
14
Key Investment Highlights
Naver
Yandex
Baidu
(launched 1997) (launched 2001) (launched 1999)
1 2 3
Russia ChinaSouthKorea
Yandex
Others
Baidu
Others
Others Google
NHN
Source: Liveinternet.ru, comScore, Analysys International
Local Champions Can Win in Search
76%
19%
5%
65%
9,5%25,5%
12%
28%
60%
15
Introduction
Yandex is the Market Leader
#1 Internet Destination
45 million unique visitors per
month2
44% of Russian users’ homepages3
Search Leader
60% search market share in
Russia1
Leading Online Advertising
Platform
270,000+ advertisers in 20114
51% online ad market share5
Largest Russian Internet Business
FY 2011
$622m Revenues6 (60% yoy
growth)
$287m Adj. EBITDA7 (50% yoy
growth)1 Source: Liveinternet, January 20122 Source: comScore (December 2011)3 Source: TNS, January 20114 Source: Company Information, FY 2011
5 Source: AKAR 2011, as of Feb 22, 2012, adjusted for commissions6 Source: Company Information for the FY period 2011, using an exchange rate of RUR 32.1961 to $1.00 as of Dec 31, 20117 Source: Company Information for the FY period 2011, using an exchange rate of RUR 32.1961 to $1.00 as of Dec 31, 2011 Adjusted EBITDA is EBITDA before share-based compensation
16
Yandex: The Gateway to the Russian Internet
News
Traffic Jams / Maps
Yandex.Money
Comparison Shopping
Russia’s Most Popular Homepage – 44% of All Russian Users
17
Key Investment Highlights
Source: Company information, Liveinternet.ru, iResearch, SearchEngineWatch.com, comScore
Continuous Focus on Innovation
1. Baidu News Service launch date based on being available as of the date of IPO
1998
1997 2000 2002 2004
2002 2004 2006
2001 2005 2008
1
Search
MapsShoppingNews
PaymentsLanguage
Understanding
1989
2005
1989
18
Local Focus and Understanding
Russia/CIS is our “Backyard” Locally-relevant Content and Services
Financial Review
Our Ad Campaigns Have a Russian Accent…
Search Verticals
Maps/TrafficStreet Views
ImagesVideosMusicGoodsBlogs
…
“The monitor does not give consultations.”
1,400 different territories for Yandex
Russia + Ukraine + Kazakhstan + Belarus
19
Yandex is Replicating Success in Adjacent Markets
Key Investment Highlights
Share of Search Traffic in Ukraine, Kazakhstan and Belarus 1
Ukraine Kazakhstan Belarus
Source: LiveInternet.ru
(2005) (2009) (2010)
19%
28%
3% 3%
73%
60%
24%
50%48%
22%
24%
19% 6%7%
38%37%
46%46%
1. Search traffic reflects transitions by respective country’s users to local and Russian sites
Turkey – Our First International Market
Population of 76MM Internet users (‘11): 35MM (46%) 28 local portals Online ad market (‘13E): $300MM No established #2 player in search
1 Euromonitor; FOM; Global Insight; InternetWorldStats.com; ZenithOptimedia; Advertising Expenditure Forecasts, December 2011; Internet user penetration based on total population (source: Global Insight)
2 comScore, January 2012
Turkey at a Glance1 Yandex in Turkey
2.0MM users in January 20122
>200K daily users of the portal 2
Local content & home page Exclusive content on Yandex.Maps
Maps and Map Based ServicesTurkish Market: Fast Growing and
Sizeable
130K downloads of Yandex Mobile
Maps
News
News
Image search
Image search
Video search
Video search
Search for
goods
Search for
goods
Weather
Weather
WidgetsWidgets
Expected to be among leading EMEA markets in terms of Ad Expenditure growth in 2011-2014
20
21
Russian Internet market
Yandex overview
How it works
Get Stare
Agenda
PPC interface available in English
22
Bid management in English
23
Wide range of Banner Ad options available
24
Yandex.Metrica – web analytics tool available in English
25
26
Organic engine rewritten and launched as MatrixNet in November 2009
Most of the “old” advice doesn’t apply anymoreMachine learning based; Archetypal sites” chosen as targets by
“Assessors”
Makes advising on SEO very hard; we don’t even know what the weights are
No formal customer support team for SEO’sVery good webmaster tools (available in English)General written guidelines available for how to get included in
index
Yandex 101
SEO for Yandex
27
What problems occurred during the indexing process Which pages are included in the search index Who links to your website What searches people make to find your website How to protect your site from viruses How to improve the appearance of your site in the search results
Yandex Webmaster Tools tell you
28
Yandex Webmaster Tools Examples
Click Share by Query CTR by Query
Links Popular Queries
29
Contact International Business Development team
Free translation, training and initial setup
Local optimization and campaign feedback
Dedicated English speaking Account Manager in Moscow
Web based reporting, budgeting, etc. available in English language interface
U.S. or European Yandex entity available for simplified payment, invoicing & contracting
Dollars vs. Rubles
Post pay billing available
U.S. or EU vs. Russian legal jurisdiction
Get Stare
Want to try Yandex?
Preston CareyDirector, Business Development
[email protected]+1 857.288.8762@prestoncarey
Thank You!