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A CASE STUDY ON STRATEGY
Yandex Resist Google's World Domination
Search Market In Russia
                          Top 5 Players By Reach
             62.4%

                        51.0%     49.1%
                                            42.4%   40.5%




             Yandex    Mail.Ru   Rambler     AOL    Google

Source : Comscore
Yandex Revenue Growth (in $M)

                                                167




                                      73

                                35
                          18
               8


            2003        2004   2005   2006   2007


Source : Company Info
Yandex Key Milestones

          Developed                    2003 : Yandex               2006 : Launches


                             2000-05
   90’s




                                                         2006-08
          Yandex                       breaks even                 free, online,
          technology                   2004 : Adopts               real-time traffic
          1997 : Yandex.ru             ‘Clean Mail’                monitoring for
          website                      concept — email             Moscow
          1998 :                       free of spam                2007 : Yandex
          Iintroduces                                              Local Network
          contextual Ads                                           Program




Source : Company Info
Key Consumer Insight
                   Moscow's Daily Traffic Jam (Spring 2006 to Spring 2007)
Traffic Pressure




                    Summer     Winter
Source : Company Info
Key Consumer Insight

  Every day Moscow faced about 650 traffic jams,
  each traffic jam stopped 1,500 cars. The average
  traffic jam duration was 1 hour & 8 minutes.
  Within one month of the past year drivers would waste
  in traffic jams more than 11     hours, which totals to
  1.5 working day.

Source : Company Info
Search Distribution
Yandex Toolbar & Desktop Tools Around The Functional Utility




                                                   ‘Smart
                                                application ‘
                                                   on Jam
                                                 Indicator-
                                               updated every
                                                    5 min
Fierce Battle Of Outdoor Ads
                                    Google Russia : Moscow 2.0
                                    Embed city images & videos onto a
                                    virtual Moscow map.
                                    Budget : $ 250 K / Month




                                   VS
Yandex : Traffic 2.0
GPS based UGC traffic congestion
monitoring service .
Budget : $ 150 K estimated
Compete & Collaborate
• Jan ‘08 : Strategic partnership between
  Mail.Ru & Yandex in search technologies &
  contextual advertising.
• June ‘08 : Yandex buys Smilink , Russian road
  traffic monitoring agency.
• July ‘08 : Google ties up with Rambler to
  power the search.
• July ‘08 : Google buys contextual ad firm
  begun.
Search Landscape Today..
             Yandex + Mail.ru shines & trouble time for Rambler
 70%

 60%

 50%

 40%

 30%

 20%

 10%

   0%




Source : LiveInternet     Yandex   Google   Rambler   Mail.ru
Identity Makeover..
           . . . Logo Changes


1996



1997



1999
                   The new logo displays the Yandex name in
                   Cyrillic , to reflect that Yandex has become a
2004               household name in Russia.
“We have better technology & understanding of the market. I take the competition
seriously & every day check the latest figures to see where it is, but I think we will stay far
ahead. What was enough for Google to conquer other markets isn’t enough in Russia.”
                                   Arkady Volozh , Co founder & Chief Executive of Yandex
quot;Yandex concentrated on search & developed a really good engine“.
                                               Vladimir Dolgov, Head of Google Russia
Insights For Global Marketers ..
• Identify one everyday problems in a country &
  develop a functional utility (eg : Moscow
  street traffic)
• Concentrate all your marketing efforts around
  that ‘functional utility’.
• Focus on distribution challenges. Identify your
  local partners carefully . Collaborate &
  compete at the same time.
www.trendsspotting.com

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A Case Study on Strategy :Yandex Resist Google's World Domination

  • 1. A CASE STUDY ON STRATEGY Yandex Resist Google's World Domination
  • 2. Search Market In Russia Top 5 Players By Reach 62.4% 51.0% 49.1% 42.4% 40.5% Yandex Mail.Ru Rambler AOL Google Source : Comscore
  • 3. Yandex Revenue Growth (in $M) 167 73 35 18 8 2003 2004 2005 2006 2007 Source : Company Info
  • 4. Yandex Key Milestones Developed 2003 : Yandex 2006 : Launches 2000-05 90’s 2006-08 Yandex breaks even free, online, technology 2004 : Adopts real-time traffic 1997 : Yandex.ru ‘Clean Mail’ monitoring for website concept — email Moscow 1998 : free of spam 2007 : Yandex Iintroduces Local Network contextual Ads Program Source : Company Info
  • 5. Key Consumer Insight Moscow's Daily Traffic Jam (Spring 2006 to Spring 2007) Traffic Pressure Summer Winter Source : Company Info
  • 6. Key Consumer Insight Every day Moscow faced about 650 traffic jams, each traffic jam stopped 1,500 cars. The average traffic jam duration was 1 hour & 8 minutes. Within one month of the past year drivers would waste in traffic jams more than 11 hours, which totals to 1.5 working day. Source : Company Info
  • 7. Search Distribution Yandex Toolbar & Desktop Tools Around The Functional Utility ‘Smart application ‘ on Jam Indicator- updated every 5 min
  • 8. Fierce Battle Of Outdoor Ads Google Russia : Moscow 2.0 Embed city images & videos onto a virtual Moscow map. Budget : $ 250 K / Month VS Yandex : Traffic 2.0 GPS based UGC traffic congestion monitoring service . Budget : $ 150 K estimated
  • 9. Compete & Collaborate • Jan ‘08 : Strategic partnership between Mail.Ru & Yandex in search technologies & contextual advertising. • June ‘08 : Yandex buys Smilink , Russian road traffic monitoring agency. • July ‘08 : Google ties up with Rambler to power the search. • July ‘08 : Google buys contextual ad firm begun.
  • 10. Search Landscape Today.. Yandex + Mail.ru shines & trouble time for Rambler 70% 60% 50% 40% 30% 20% 10% 0% Source : LiveInternet Yandex Google Rambler Mail.ru
  • 11. Identity Makeover.. . . . Logo Changes 1996 1997 1999 The new logo displays the Yandex name in Cyrillic , to reflect that Yandex has become a 2004 household name in Russia.
  • 12. “We have better technology & understanding of the market. I take the competition seriously & every day check the latest figures to see where it is, but I think we will stay far ahead. What was enough for Google to conquer other markets isn’t enough in Russia.” Arkady Volozh , Co founder & Chief Executive of Yandex quot;Yandex concentrated on search & developed a really good engine“. Vladimir Dolgov, Head of Google Russia
  • 13. Insights For Global Marketers .. • Identify one everyday problems in a country & develop a functional utility (eg : Moscow street traffic) • Concentrate all your marketing efforts around that ‘functional utility’. • Focus on distribution challenges. Identify your local partners carefully . Collaborate & compete at the same time.