Russian internet market and yandex overview iss london.18 may 2011

Yet Another Index? ISS London May 2011

• Intro to Russian Internet Market• Yandex 101• How do you get started? ISS London May 2011

Russian Internet Market Internet User Growth - Global Growth is driven by Russia in Europe and China in Asia Internet User Growth 750 2008 2009 600 +22% 477 450 +20%Millions of 390 Internet Users 325 300 271 +4% 191 184 +28% +79% 150 90 81 70 45 0 Asia Europe North America Latin America Middle East & AfricaSource: ComScore 3

Russian Internet Market Internet Users - Global Russia has the 7th largest audience of Internet Users in the world; 2nd largest in Europe Internet Users (MM) per Country 500 420 375 250 239Millions of Internet Users 125 99 81 76 65 60 51 45 44 39 0 China US Japan India Brazil Germany Russia UK France Nigeria S. KoreaSources: Internetworldstats (2010) 4

Russian Internet Market Internet Penetration - Global Russia currently has fairly low penetration compared to other large Internet populations Internet Penetration per Country 100% 83% 81% 77% 78% 79% 75% 69% 50% 43%% of Population 38% 31% 29% 25% 7% 0% China US Japan India Brazil Germany Russia UK France Nigeria S. Korea Sources: Internetworldstats (2010) 5

Russian Internet Market Russian Internet Penetration Growth Russian market is growing extremely quickly because of penetration growth Internet Penetration in Russia (2000-2010) 75% 50% 43% % of 37% Population 27% 25% 21% 19% 15% 12% 7% 10% 2% 4% 0% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010Source: International Telecommunications Union 6

Russian Internet Market Russian Internet users by Age Range Moscow & St Pete Internet penetration resembles major western cities Age 18-24 25-34 35-44 45-54 55+ Moscow Russia Total Population Internet UsersNote: December 2010 7

Russian Internet Market Top Internet Sites in Russia Most major sites are local Total Unique Site Visitors (000) % Reach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ource: ComScore (December 2010) 8

Russian Internet Market Search Engine Industry in Russia Search Engine Traffic Market Share in Russia, January 2011 Mail.ru Other 7% 4% Rambler 2% Google 22% Yandex 65%Source: LiveInternet.ru 9

Russian Internet MarketMarket Share Evolution Russian Search Traffic Market Share Nov 2009 MatrixNet 65% Dec 2010 Spectrum (Semantic 58% Upgrade) July 2010 Orange (Realtime May 2008 Search) Updated core search and ranking algorithms 2006 Google introduces Russian language morphology-based search capabilities June 2008 26% Google launches outdoor advertising campaign 22% 2001 Google launches March 2006 Russian language Google opens search engine office in Russia 5 7% 5 2% Mar-05 Sept-06 Jun-07 Dec-07 Jun-08 Dec-08 Jun-09 Dec-09 Jun-10 Dec-10Source: LiveInternet.ru. Based on monthly search traffic to Russian websites from Russian IP addresses 10

Russian Internet Market Social Networking in Russia Local players dominate social media; but Facebook and Twitter doubled in reach in 2010 Global Russia Total Unique Total Unique Site Visitors % Reach Site Visitors % Reach (000) (000) 1 Facebook 662,420 50% 1 VKONTAKTE.RU 32,992 72% 2 Windows Live Profile 131,206 10% 2 Odnoklassniki 27,134 59% 3 Twitter 104,995 8% 3 Mail.Ru - My World 16,458 36% 4 MySpace 79,474 6% 4 FACEBOOK.COM 8,668 19% 5 LinkedIn 65,775 4% 5 FOTOSTRANA.RU 5,216 11% 6 Orkut 52,755 4% 6 TWITTER.COM 2,660 6% 7 Vktontakte 50,517 4% 7 PRIVET.RU 1,848 4% 8 Odnoklassniki 43,241 3% 8 VKRUGUDRUZEI.RU 1,055 2% 9 Yahoo! Puls 39,709 3% 9 MOIKRUG.RU 1,000 2%Source: ComScore (December 2010) 11

Russian Internet Market Russian Digital Advertising Market Market grew ~60% Y/Y in Q1 2011 Digital Advertising Market ($MM) $1,500 $1,333 $1,200 $1,067 $900 $817 $708 Text-based $599 $600 $497 $517 $410 $356 $237 $274 $300 Display $56 $107 $130 $298 $300 $21 $47 $107 $223 $243 $0 $0 $35 $60 $0 $0 $0 2004 2005 2006 2007 2008 2009 2010 2011 (f) 2012 (f) Digital Ad Market as a % of Total Advertising Market 15% 13% 12% 11% 9% 10% 6% 5% 5% 3% 1% 2% 0% 2004 2005 2006 2007 2008 2009 2010 2011 (f) 2012 (f)Sources: All data other than for online text-based advertising for 2004 - 2006 based on ruble-denominated data from the Association of Communication Agencies of Russia (AKAR). Data on online text-based advertising for 2004 – 2006 are provided by AIB, and include both text-based advertising and a small portion of contextually targeted display advertising. 2010-2012 data from Kommersant. All data are reported inclusive of VAT 12

Russian Internet Market Text Ad Revenues in Russia Yandex owns ~80% of the Russian text ad market when measured by revenues Yandex v More than 78,000 advertisers vMore than 4,300,000 active ads vMore than 29,000,000 active keywords Google BegunSources: Market report from Q1 2011; data from iContext 13

• Intro to Russian Internet Market• Yandex 101• How do you get started? 14

Yandex 101To Win in Certain Markets, Local Knowledge is Key China Proprietary Search South Korea Search market share 1: Search market share 2: • Baidu – 73% Technology • Naver – 75% • Google – 25% • Google – 3% Search market share 3: • Yandex – 65% • Google – 22% + Taiwan Czech Republic JapanSources:1. Analysys International2. KoreanClick3. LiveInternet.ru 15

Yandex 101 Yandex at a Glance The largest Internet company in Russia v 65% market share in search Russia’s #1 v Over 54 million users per month search engine v Over 20 years of development v Local market dominance Differentiation v Breadth and reach for all demographics v Machine learning based organic engine v Local search / Location based services 2011 Initiatives v Global expansion v IPO on NASDAQ Track record in v FY 2010 gross revenue - $430M (~85% from text ads) monetization and v Up 43% over 2009 y/y profitability v 40%+ EBITDA marginSources: LiveInternet.ru; ComScore 16

Yandex 101Yandex - Russia’s Search and Information Retrieval PortalThe largest and highest rated Internet offerings in Russia News #1-3 Mail #2 Market #1 Traffic jams/ Photo Sharing #3 Weather #1 maps #1 Blog search #1 Money #1 17

Yandex 101Text Ads on Yandex’s Owned & Operated WebsitesAccess to the large user base of Yandex’s search and other services Yandex.Direct Highest ranking ads Yandex.Direct Paid search ads ranked by cost per click, CTR, and relevance Organic search results Produced by Yandex search Yandex.Market algorithms Relevant offers from Yandex comparison shopping system Banner Contextual graphical ads 18

Yandex 101Text Based Ads v Auction based system based primarily on CTR and Bid v Placement on four types of sites: v Yandex Search v Partner Search (ex. Bing.ru) v Yandex Advertising Network v Catalogue & Market Pages v Three types of targeting available: v Contextual/keyword v Geographic (city level) v Thematic (categories of site types in network) v Variety of tools available to help in campaign management v Keyword suggestion, refinement & bid management v Automatic bid management v Budget management 19

Yandex 101 Top Industries on Yandex Wide variety of opportunities in both B2C and B2B Top Ten Industries on Yandex vAutomotive vBanking & Finance vBusiness Services vConstruction vConsumer Shopping vHousing & Rentals vManufacturing vPersonal Health vReal Estate vTourismSources: Yandex; Top Ten by overall spend in recent period 20

Yandex 101Who sees Yandex ads?Significant reach across multiple cities and countries 21

Yandex 101Text Ad AudienceGeographic targeting is critical for campaign success Moscow and St Petersburg Other Regions Internet audience Contextual ads audience Paid clicks 22

Yandex 101Wide Array of High Volume Display Advertising LocationsHome Page, Mail, News, Travel, Money, Traffic, TV Guide, Market, Gift Cards, Maps, Weather, 404 Page... 23

Yandex 101SEO for Yandex vOrganic engine rewritten and launched as MatrixNet in November 2009 vMost of the “old” advice doesn’t apply anymore vMachine learning based; Archetypal sites” chosen as targets by “Assessors” vMakes advising on SEO very hard; we don’t even know what the weights are vNo formal customer support team for SEO’s vVery good webmaster tools (available in English in Q3 2011) vGeneral written guidelines available for how to get included in index vGood writeup by Webcertain that summarizes how the engine works 24

• Intro to Russian Internet Market• Yandex 101• How do you get started? 25

Get Started4 Things to Remember vSimple auction based bidding; but with some local differences vGeographic targeting is important; but you can dip your toes in without it vRussian language is very different; localization and translation from English is difficult v“Conversion” can be different; make sure you are measuring the right things 26

Get StartedWant to try Yandex? vContact International Business Development team vFree translation, training and initial setup vLocal optimization and campaign feedback vDedicated English speaking Account Manager in Moscow vWeb based reporting, budgeting, etc. available in English language interface vYandex U.S. entity available for simplified payment, invoicing & contracting vDollars vs. Rubles vPost pay billing available vU.S. vs. Russian legal jurisdiction vEuropean entity planned for late 2011 27

Thank You! Preston Carey Director, Business Development preston.carey@yandex.ru +1 857.288.8762 @prestoncarey 28

Appendix 29

Russian Internet Market Russian Advertising Market Russian Advertising Market ($MM) $12,000 $11,150 6% $10,373 13% $9,200 17% $8,874 $9,000 5% 12% 13% 17% $7,567 $6,800 21% 11% 13% $6,450 14% 13% $6,000 18% 22% 5% 9% 14% 5% $5,100 13% 15% 4% $MM 24% 6% $3,930 18% 16% 4% 4% 18% 7% 27% $3,000 56% 31% 6% 50% 57% 48% 57% 6% 56% 47% 46% 43% $0 2004 2005 2006 2007 2008 2009 2010 2011(f) 2012(f) TV Radio Print Outdoor InternetSources: All data other than for online text-based advertising for 2004 - 2006 based on ruble-denominated data from the Association of Communication Agencies of Russia (AKAR). Data on online text-based advertising for 2004 – 2006 are provided by AIB, and include both text-based advertising and a small portion of contextually targeted display advertising. 2010-2012 data from Kommersant. All data are reported inclusive of VAT 30

Yandex OverviewCompany HistorySearch technology developed and refined over almost 20 years Founding team Search of starts Incorporation Fact Launch of international developing of Yandex Yandex.ru extraction Yandex documents Yandex search website is Parallel technology in advertising technology launched Search Yandex.News network Yandex.Traffic Yandex.com 1993 1998 2002 2004 2007 2009 1989 1997 2000 2003 2005 2008 2010 Breakeven MatrixNet – Founding team The first Proprietary Purchase of point achieved breakthrough joins CompTek contextual anti-spam Yandex.Money in Q3 search banner is software displayed School of Data technology introduced Analysis Yandex.Music 31

Yandex OverviewB2B vs B2C: CPC DynamicsB2B CPC’s are pricer than B2C 32

Yandex OverviewB2B CPC DetailB2B CPC has on average remained flat over last 30 months 33

Yandex OverviewYandex Advertising Network extends our reach vHigh quality, manually moderated partner sites vMinimum daily audience of 30k visitors per site vExcludes “made for advertising” sites which can be prolific in Runet 34

Yandex OverviewB2C CPC DetailB2C CPC prices are generally rising; up to 50% per year 35

Russian Internet Market U.S. Internet Population vs. Rest of World Global SEM is critical for most multinationals Global Internet Population Growth 100% 34% 75% 85% Rest of World 50% United States% of total InternetPopulation 66% 25% 15% 0% 1996 2009Source: ComScore 36

Russian Internet Market Internet Penetration: Moscow vs. Other Regions Internet Users (2009) Central, incl. Moscow Other (31%) Regions 1 (69%) Internet Penetration in Russia (2009) TNS reports that over 85% of 61% Internet users in Moscow have 48% broadband access 37% 36% 34% 32% 31% 30% Moscow Central ex-Moscow Northwest Far East Ural Siberia Volga SouthSource: FOM (18+ age group) for Fall 2009; 1. Includes Volga, North-West, South, Siberian, Ural and Far East Source: FOM (18+ age group) for Fall 2009 37

Russian Internet Market Top 10 Runet Sites as of April 2010 Russia, Monthly Reach (000’s)Sources: TNS Web Index Research 38

Yandex Advert. EnginesYandex Display Advertising vThree types of display advertising are currently offered: Wide Audience v ex. Yandex Home Page v Most visited page on Runet (16M users per week) v Top advertisers in Russia are here (Honda, Nokia, Coke, HP, etc) Affinity v ex. Yandex “What’s on Guide” v Top guide to cultural entertainment in Moscow and St. Petersburg v 3M unique visitors per week Contextual v ex. Yandex Search Engine v Broad contextual targetting v Large content sites can also be targetted 39

Yandex Advert. EnginesContextual Text Ads Yandex.Direct is a Pay-Per-Click keyword-based service for placing ads on Yandex and on partner sites of the Yandex Advertising Network. 40

Yandex Advert. EnginesAds on the Yandex Network of Partner WebsitesBroader audience reach for Yandex and its advertisers; enhanced monetization prospects for network partnersthrough targeted contextual and/or search advertising Network Partners Bing, Aport & Nigma Contextual advertising Search advertising Served by Yandex based on the Served by Yandex based on natural content of the third-party website search results and/or the user’s search history 41

Yandex Advert. EnginesYandex.Market vLeading comparative shopping service vWeekly audience of 2.5M unique users vOver 1,500 vetted shops 42

Yandex Advert. EnginesYandex.Direct Tools vBid management, campaign reporting, keyword suggestions, webmaster tools and online help are all available 43

User ServicesBreadth of User Services and Category LeadershipYandex is one of the best known Internet brands in Russia Core web search service #1 Yandex.Search The leading search engine in Russia Other search and information retrieval services Other services and user-generated content #1 #2 Yandex.Maps & Traffic Maps and traffic monitoring Yandex.Mail Email service #2 Yandex.News Aggregator of news Spamooborona Anti-spam software #1 Yandex.Market Price comparison and shopping engine MoiKrug.ru Online network for professionals #1 Yandex.Blogs Blog search tool Yandex.Fotki Photo hosting and sharing Yandex.Adresa Yellow pages and address finder Narod Website hosting platform Yandex.Auto New and used car search Utilities Yandex.Video Video search and hosting service Yandex.Bar Yandex toolbar utility #1 Yandex.Dictionaries Reference and translation resource Yandex.Server Search tech. for servers and networks Yandex.Catalog Thematic directory of Russian Yandex.Desktop Search Search tech. for personal computers websites Yandex.Online Incoming email notification system Yandex.Afisha Movie and live events guide Yandex.TV TV program guide Online payment system and mobile applications Yandex.Travel Schedules Plane and train schedules Yandex.Money Online payment system #1 #1 Mobile applications Mobile versions of selected Yandex Yandex.Weather Weather forecasts (1,700 cities services worldwide) 44

User Services Yandex.Maps & Traffic #1 The leading maps and traffic service in Russia Key features Monthly users in Russia, June 2008 (000s) • Detailed scalable maps with street names and house numbers • Satellite images of Russia and Europe • Proprietary and exclusive live traffic congestion monitoring system – Acquisition of road traffic monitoring agency Smilink – User-generated input via GPS-enabled devices • Yandex.Adresa – fully integrated with Yandex.Maps, helping users find local business listings and events • Mobile maps recently launched – 120,000 weekly users Information on local businesses Traffic jam viewerSource: Server logs (stat.yandex.ru, stat.mail.ru) 45

User ServicesYandex.Mail #2Webmail service for the tech-savvy Russian users Advanced web mail service Monthly users in Russia, June 2008 (000s) • Proprietary anti-spam technology • Unlimited storage space • “Opt out” option for advertising-free email interface • AJAX interface – Search-as-you-type – Email quick summary feature • Advanced address book ⎯ Transliteration Latin/Russian alphabets Source: TNS ‘Spamooborona’ anti-spam technology Monthly users in Moscow, June 2008 (000s) • Proprietary, popular anti-spam software – Used in Yandex.Mail as well as other web mail and corporate email systems • Filters approximately 95% of email as spam • Performs analyses of thousands of email properties to ensure highly efficient and precise filtering • Standalone server solution • Mass mail clustering • Self-learning system automatically collects spam characteristics Source: TNS 46

User ServicesYandex.News #2News aggregation service Key features of Yandex.News Monthly users in Russia, June 2008 (000s) • Innovative aggregation features ̶ News clustering by event ̶ Multi-document summary of an event ̶ Geo-tagging and categorization of events ̶ Name and fact extraction ̶ Linked to biography and quotation database ̶ Searchable news stories within minutes of publication on the web by original source • No editorial intervention − Technology-driven, politically agnostic Source: TNS − No preferred sources − No proprietary content Monthly users in Moscow, June 2008 (000s) − News aggregators popular in Russia for the diversity of views they provide access to • Over 2,000 “content-for-traffic” agreements with copyright owners − 30,000 automated entries per day − No copyright infringement Source: TNS 47

User ServicesYandex.News (continued)Innovative functionalities: fully automated news clustering, summaries and facts extraction Real-time breaking news displayed at the Top news top stories Personalities in the news and link to their “press portraits” Original story and full list of related entries, images and videos Top stories in the same news category 48

User ServicesYandex.Market #1The leading comparison shopping service Value proposition Monthly users in Russia, June 2008 (000s) • Price comparison and consumer reviews for shops and thousands of products throughout Russia • Advanced recommendation engine – Database of thousands of product models and features – Product description compiled by Yandex • Prioritizes display of offerings from shops in close proximity to users, increasing relevance to shoppers and advertisers • Cross-shop basket • Public wish lists Source: TNS Key features Monthly users in Moscow, June 2008 (000s) • Over 1,500 pay-per-click merchants – Automatic product categorization and identification – Online retailers need to register to get their products and prices referenced; no unsolicited “price grabbing” – Strict merchant quality control • Does not compete with online store fronts – Yandex does not keep inventory • User reviews of merchants and products Source: TNS 49

User ServicesYandex.Market (continued)Sample product page Pricing evolution List of shops Summary Publish in wishlist Product description Submit reviews Related products Product accessories Detailed product specifications 50

User ServicesYandex.Dictionaries #1The leading reference and translation online resource Value Proposition Monthly users in Moscow, January 2008 (000s) • Comprehensive reference and multi-language translation tool for Russian users • Access to online encyclopedias and more than 60 dictionaries – Yandex sponsors digitization of encyclopedia and other offline resources under exclusive agreements • Integrated within Yandex.Search to power parallel results Source: TNS Access to a rich and ever-expanding database of dictionaries and encyclopedia Search Languages available for translation List of dictionaries and Recently added encyclopedia dictionaries and encyclopedia Total number of dictionaries 51

User ServicesYandex.Fotki #3Photo hosting Key features My favorite • Photo sharing website photographers Search • Unlimited storage space • Easy mass upload tools (built in browser) Easy photo Easy photo print • Launched in 2007 and is already #3 photo hosting service in Russia download • Accessibility on mobile devices / easy file transfer • Social network features Monthly users in Russia, June 2008 (000s) Photo contest Real-time top photos of the day Most popular Links to Recently categories related downloaded photos services Source: TNS; although not measured by TNS, we believe that PhotoFile is #2 52

User ServicesYandex.Blogs #1The leading blog search engine in Russia Search Advanced blog search and hosting service • Collects important information daily out of the Russian blogosphere • The largest and most comprehensive blog search engine in Russia • Providing instant access to more than 4.5 million blogs as of June 30, 2008 • Key attractions for our users include daily rankings on Yandex.Blogs of the most popular postings and topics • Ability to filter spam Most Most popular discussed blogs entries of the day 53

User ServicesNew User Services – Recently LaunchedNumerous opportunities to add complementary services and drive further growth in user base Auto search Train and plane schedules Video search and hosting Disk (file sharing) 54

User ServicesYandex.MoneyLeading online payment solution with a broad base of users and merchants Active users (000s) Selected online merchant partners Russian International 9% : 12 CAGR 07 04- Total payments volume ($MM) % 132 R: CAG 07 04- 55

Automotive Market Russian Automotive Market v 2009 was a challenging year; overall sales down by 50% v Currently 10th largest Automotive market in the world v Roughly 1/3 the size of U.S. market v Very low car ownership per capita compared to Western markets v Government is strongly focused on supporting (domestic) industry: v Increased import duty v Subsidized loans for purchase of domestic autos v Direct support and intervention for domestic OEMs v Incentives for car scrapping v Tightening restrictions on importing older used vehicles v Strong growth is forecast to return; expected to become the 3rd largest market in the world over the next 5 yearsSources: IHS Global Insight; Earnst & Young; Ministry of Economic Development 56

Automotive Market Automotive Brand Market Share in Russia Foreign brands dominate the top 10 Top Ten Automotive Brands ($ Share, 2009) 30% 24% 20% % ofRussianMarket 10% 7% 6% 5% 5% 5% 5% 4% 4% 3% 0% LADA Chevrolet Ford Hyundai Renault Kia Toyota Nissan Daewoo MitsubishiSources: AEB 57

Automotive Market Volume loss in 2009 Market collapse was not shared equally among all brands Loss in Volume of Cars Sold, 2009 vs. 2008 70% 66% 64% 61% 59% 56% 54% 47% 44%% of Volume 35% Lost 33% 23% 19% 0% LADA Chevrolet Ford Hyundai Renault Kia Toyota Nissan Daewoo MitsubishiSources: AEB 58

Automotive Market Automotive Industry on Yandex Automotive is growing quickly and one of Yandex’s top industries Top Ten Industries on Yandex v Automotive v Housing & Rentals v Banking & Finance v Manufacturing v Business Services v Personal Health v Construction v Real Estate v Consumer Shopping v Tourism Automotive Spend on Yandex Total Automotive 61% Y/Y Spend on Growth Yandex Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug 2009 2010Sources: Yandex; Top Ten by overall spend in recent period 59

Automotive Market Relative Industry Competition in SEM Automotive CPC is much lower than other Top 10 Industries Relative CPC on Yandex of Top 10 Industries Housing & Rental 100% Construction 98% Business Services 86% Banking & Finance 77% Personal Health 77% Real Estate 68% Manufacturing 68% Consumer Shopping 55% Tourism 45% 59% Avg. Across All Industries Automotive 43% 0% 25% 50% 75% 100% Relative CPCSources: Yandex 60

Automotive Market Automotive Spend by Brand on Yandex Wide range of spend that is not well aligned with current market share Relative Spend by Brand on Yandex (2010) 100% 98% 100% 86% 77% 77% 75% 68% 68%% of Largest Brand 55% Spend 50% 45% 43% 25% 1% 1% 1% 1% 0% A B C D E F G H I J K L M N Brand Sources: Yandex 61

Automotive Market CTR by Brand on Yandex CTR optimization is highly varied even among big spenders CTR by Brand on Yandex 4% 2009 2010 3.1% 3% CTR 2% 1.6% 1.5% 1% 0.7% 0.6% 0.5% 0.6% 0.6% 0.5% 0.5% 0.5% 0.5% 0.4% 0.4% 0.3% 0.3% 0.3% 0.3% 0.3% 0.3% 0.3% 0.2% 0.1% 0.1% 0.1% 2010 Average CTR 0% 0% 0% 0% A B C D E F G H I J K L M N BrandSources: Yandex 62

Automotive Market CPC by Brand on Yandex Average CPC has remained constant but individual brands performance has changed significantly CPC by Brand on Yandex $1.50 2009 2010 $1.16 $1.13 $0.96 CPC $0.84 $0.87 $0.86 $0.81 $0.75 $0.72 $0.56 $0.56 $0.49 $0.48 $0.50 $0.50 $0.43 $0.45 $0.45 $0.43 $0.42 2010 Average CPC $0.38 $0.32 $0.34 $0.30 $0.26 $0.17 $0.12 $0.10 $0 $0 $0 $0 A B C D E F G H I J K L M N BrandSources: Yandex 63

Automotive Market Share of Voice by Brand on Yandex Large spenders share of voice has shifted strongly in 2010 Share of Voice by Brand on Yandex 30% 2009 27% 26% 2010 21% 20% 20% 17% % of TotalAutomotive 14% Industry Clicks 13% 13% 12% 10% 10% 6% 5% 3% 2% 2% 2% 2% 2% 1% 1% 1% 0% 0% 0% 0% 0% 0% 0% 0% A B C D E F G H I J K L M N Brand Sources: Yandex 64

Automotive MarketAutomotive SEM Takeaways v Establishing market share is key in this fast growing market v Lower market share foreign brands are increasing budgets aggressively v Dominance in the automotive SEM market is still being established v Fairly low competition today v ROI and tracking technologies are not well established v Budgets are all over the map but growing v Existing “global” campaigns are rarely well optimized for local realities 65

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Russian internet market and yandex overview iss london.18 may 2011

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