Preston CareyBusiness Development Director

• Market Trends

• Yandex Overview

• Advertising Opportunities

Agenda

• Online Customers in Russia

Market Trends

4

67,4

50,3

61,5*

23,

Source: Internet World Stat 2011-2012

in 2012 Russia became the largest internet audiencein EuropeBig

5

Low penetration – high upside!

Source: FOM (Public Ppinion Foundation) release, March 2012.Data for the countries other than Russia is provided by InternetWorldStats.com as of March 2012

6

The Russian advertising market continues to grow rapidly

№ Country Growth

1 U.S.A. 19 821

2 China 11 641

3 Brazil 5 397

4 Russia 4 026

5 Indonesia 3 911

6 Japan 3 015

7 Argentina 2 268

8 South Africa 2 067

9 Great Britain 1 883

10 South Korea 1 702

The global ad market will have grown

by U.S. $4 billion from 2011 – 2014

Source: ZenithOptimedia, September 2012

Countries contributing the most to the growth of the world ad market (bln. $)

7

And here’s the result…

We’re now one of the top ten largest world ad markets

2011 Value 2014 Объем

1 U.S.A. 154 129 1 U.S.A. 173 950

2 Japan 49 949 2 Japan 52 964

3 China 32 299 3 China 43 940

4 Germany 25 571 4 Germany 26 828

5 Great Britain 19 204 5 Brazil 22 216

6 Brazil 16 819 6 Great Britain 21 088

7 France 13 788 7 France 14 216

8 Australia 12 767 8 Australia 13 770

9 Canada 10 974 9 Russia 12 593

10 South Korea 10 232 10 Canada 12 394

Source: ZenithOptimedia, Sptember 2012

8

How the market will look

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 20140

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

200,000

Russian ad market segment dynamics

Журналы

ТВ

Наружная

Интернет

Mln

. ru

ble

s

Magazines

TV

Outdoor

Internet

Source: ZenithOptimedia, Sptember 2012

9

Global advertising shifts

TV48%

Radio4%

Cinema/Indoor2%

Outdoor12%

Press9%

Internet25%

TV33%

Radio6%

Cinema/Indoor0%

Outdoor20%

Press41%

Online0%

20142000

Source: ZenithOptimedia, June2012

10

Contextual advertising is the most popular type of online advertising and its market share continues to grow

2008 2009 2010 2011 2012

58% 60% 61% 63% 68%

42% 40% 39% 37% 32%

Russian online ad market structure dynamics

Contextual Banners

Source: АКАР, 2013

Russian ecommerce market

58 million monthly users online (~41% of all population)

15 million users seek information about goods

10 million users buy in e-shops

E-commerce B2C revenue – 8 billion dollars (2011), growing ~30% per year

Growth is due to expansion of regional shoppers.

*FOM 04.2012

12

E-commerce boosts online advertising

2012 2015$0

$5

$10

$15

$20

$25

$30

$35

$40

Chart Title

Bil

lio

ns

The e-commerce market in Russia will double between 2012 and 2015

Source: Morgan Stanley, 2013

Yandex Overview

14

#1 search in Russia

1 Source: LiveInternet.ru, February 2013. Search traffic reflects Russian users to Russian websites and includes desktop and mobile

Share of Searches1

61.9%60%

26.1%

8%

6%

21%

8.6%

1.3%

15

Bigger than any TV channel

17

Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-140

3,000

6,000

9,000

12,000

15,000

18,000

21,000

24,000

27,000

Bigger than any TV channel

18

One of 3 global search engines

19

20

Yandex PortalThe gateway to the Russian internet

21

Yandex PortalThe gateway to the Russian internet

News

Mail

Comparison Shopping

Weather

Traffic Jams, Maps

Auto

MusicYandex.Money Analytics tool

JobsTV

listings

22

Servicesthat change life

23

24

The unique service supported by users themselves

Traffic

25

26

Taxi2,000 cabs online at any given seconds

300,000 downloads for iOS and Android

12 min to reach a client via traffic

Revenue share model (to be featured)

27

Online Customers in Russia

28

Search Engines as Tools for Making a Purchase

28Source: Euromonitor, Morgan Stanley

87% of online customers in Russia use search engines to make

a purchase decision

56% of them use Yandex

29

Cross-border shoppers 36%

29© GfK | August-September 2013

Online Shopping in Russia

In 2012, one in three online customers in Russia ordered a product or made a purchase abroad

Domestic shoppers 95%

25% 21

%

59%

67%

0%

17.5%

35.0%

52.5%

70.0%

3030

Reasons for Сross-Border Shopping

A large proportion of online shoppers in Russia are aware of cross-border shopping opportunities

62%

20%

17%

11%

8%

6%

4%

3%

3%

5%

© GfK | August-September 2013

3131© GfK | August-September

2013

Reasons Against Cross-Border Shopping

41.5%

18.0%

17.6%

15.8%

12.1%

11.5%

8.3%

7.4%

6.6%

3.4%

3.0%

1.4%

3232

Customer Concerns about Cross-Border Shopping

© GfK | August-September 2013

% of all Russia’s online shoppers

38.8%

32.4%

32.0%

27.4%

22.4%

21.0%

17.3%

8.3%

5.2%

5.1%

0.3%

0.2%

0.2%

Advertising Opportunities

34

Yandex – the biggestinternet ad platform

350.000 advertisers53% online ad market share

* Company Information, FY 2012** AKAR for 2012, adjusted for commissions

35

Yandex is Russia’s leading contextual advertiser

68%

28%

3% 2%

Yandex

Google Russia

Begun

Other

Source: eLama, 2013

37

Yandex Search Results Page

1st Premium

Premium

Contextual Banner

38

Yandex Search Results Page

1st Place

Guaranteed Placement

Dynamic impressions

on 2d and further

pages

39

PPC interface available in English

40

Bid management in English

41

Yandex.MarketGateway to Russian eCommerce - #1 Comparison Shopping Tool

42

MarketMore than 16.5 mln visitors monthly

More than 9,000 e-tailers

Mobile applications with barcode reader

Pay-per-click model

43

Wide rangeof Banner Ad

options available

44

Yandex.Metrica – web analytics tool available in English

45

RussianSearchMarketing.com

Preston CareyBusiness Development Director

+1 857 288 8762preston.carey@yandex.ru@prestoncarey

Thank you!