The Russian search engine marketing (SEM) market is unique and, to a large extent, different from the SEM-markets of other countries. The main difference lies in the fact that most of the search traffic is concentrated on the local search engine Yandex.
According to various estimates, Yandex’s share of search engine traffic in Russia ranges from 60% to 65%, while the share of Google, its closest follower, is about 25%. Thus, the main competition in the SEM market unfolds between the content providers Yandex.Direct and Google AdWords. In terms of functionality, these systems have differences.
- Ad formats
Both systems place text ads but with different restrictions. The header length on Yandex.Direct can be no longer than 33 characters, while Google AdWords allows for 25. The length of text ads is limited to 75 characters on Yandex.Direct and to two lines 35 word long lines on AdWords. The average length of words in Russian is longer than in English.Long titles and texts characterize Yandex.Direct as being a system that suits the peculiarities of the Russian language better and is more adapted for the Russian market.
In 2013, Yandex introduced another ad format that is different from the Google AdWords formats. For advertisements that are placed on partner sites of Yandex’s advertising network (called YAN), it is now possible to add images. The main feature of this format is that it can be added for remarketing ads, which undoubtedly greatly increases their effectiveness.
- Usability and flexibility
Yandex.Direct system has a relatively simple and intuitive interface. Its simplicity makes it more popular among Russian advertisers, especially those whose experiences in contextual advertising are relatively weak. However, for experienced advertisers, AdWords is a more user-friendly system that provides important tools for mass editing, flexible configuration, and quick optimization. All of these features make AdWords more attractive and very popular among advertisers with thousands, and even tens of thousands of ads and keyword phrases.
- Manage advertising display position
Yandex Direct shows each advertiser the recommended rates for taking up a specific position in the contextual landscape that allows an advertiser to at least get the right ad block. Google AdWords does not give this opportunity to be in a requested position. This factor is an issue for Russian advertisers when dealing with AdWords.
- Advertising networks
The major sources of traffic for both systems are their own search engines. However, both systems have a network of partner sites. The ad networks of both systems also includes a variety of content-based, news, entertainment, and business sites. In addition, Yandex.Direct shows up in the results of search engine portals Mail.ru and Rambler, which traditionally are third and fourth place in terms of search traffic.
The size and quality of these networks is difficult to compare objectively, but they can be compared on the flexibility of settings and placement targeting. Google AdWords offers more targeting options such as remarketing, targeting by user interest, targeting by site category, and targeting by keyword. Yandex offers the following targeting capabilities: retargeting, targeting by keyword, and targeting by user interest. However, it is impossible to control the interests, as they are automatically matched to the selected keywords. Yandex does not give a choice of partners for ad placement, while Google allows this. The format of ads placed on partner networks also differ. Yandex.Direct allows you to place text ads or text and image ads (ads with a picture), while Google AdWords allows you to place text ads, and banner ads in various formats, as well as promotional videos on Youtube.
- Competition and cost-per-click
Having the largest share of the search market makes Yandex.Direct more attractive to advertisers than Google AdWords. Today, according to experts, the number of advertisers is over 350,000. Therefore, it is generally believed that competition on Yandex.Direct is greater and fast growth bid in many niches. As a result, cost-per-click (CPC) for Yandex.Direct in higher on average than for Google AdWords.
- Management conversions and CPA
Every year Russian advertisers become more “advanced” and it is necessary to manage not only the placement of advertising, but also its economic returns. AdWords for many years now gives advertisers a tool that enables them to manage conversions with reference to CPA. Yandex has not yet provided anything like this. At the end of 2013, Yandex Direct finally released a similar tool, which allows the setting of weekly budgets and a desired target price action. Comparing the two tools is of course difficult. It can only be added that experts say the Yandex tool provides a significant impact on contextual media campaigns.
- Availability API for third-party developers
The growth of Internet penetration in Russia and the fact that Russia has become the European country with the largest number of Internet users have resulted in the growth of keyword queries on search engines. This makes large advertisers develop their own applications for context systems for the automation various processes via API. Yandex.Direct API is open to virtually anyone, while Google AdWords accepts only large advertisers with high turnover and a payment history of no less than six months. In addition, advertisers are forced to undergo a certification process of their applications for the Google AdWords API, which is certainly a barrier.
- Automation
The Russian contextual advertising market continues to grow at a rapid pace, which is resulting in a more complex environment for its management and control. Such a situation is driving the development of the automation advertising market in Russia. The period of 2013-2014 is marked by the advent of various automation systems. It is also worth noting the appearance of Russian startups in the segment, such as Alytics; the increased competition from foreign players like Marin Software and Adobe AdLens; and a change in strategy among market veterans, characterized by a round of new investments into the platform eLama.
- Discount policy
Yandex.Direct has a special Discount policy for regular customers with large advertising budgets. The discounts can be as high as 23%. Google AdWords does not offer discounts to its customers.
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Summing up the comparison of the two systems, there are several key points. Yandex.Direct is a leader in search engine traffic. Google AdWords provides more sophisticated and advanced tools for settings and targeting. Competition on Yandex.Direct is more intense than on Google AdWords. It is worth noting that, despite the many differences between the systems over the past few years, they approach each other and inevitably become more like each other. This trend will continue in the future, while each player will hope to come up with something unique to strengthen his position and push out his competitor.
Alexander Egorov is the Director of Development for the smart content platform Alytics. He is also an expert on CPA-campaigns and effective online media, and a consultant for CPA-contextual advertising campaigns. He has more than 9 years of experience in integrated online marketing (including to some degree within CPA and ROI) and contextual advertising campaigns for: Price.ru, Credit Bank of Moscow, Aeroflot Airlines, Tour Operators Pegas, DSBW and TezTour, Svyaznoy Bank, Saxo Bank, Central Department Store, MIAN, publisher Ferra, and the Finn Flare store.
This article is an excerpt from a comprehensive research study on Russian e-commerce and online marketing channels by East-West Digital News. To receive an executive summary at no charge please contact [email protected].
