Warc, 10 June 2014
MOSCOW/NEW YORK: Yandex, the leading Russian search engine,
is developing its programmatic offer in the expectation that economic
conditions are likely to drive reluctant advertisers and agencies towards
cheaper, more effective options.
Eugene Lomize, head of advertising technology at Yandex,
explained to Ad Exchanger that while programmatic products were growing fast in
Russia – up to fivefold in the past year – they still constituted only a very
small part of its business, "equal to a week and a half of revenue of our
contextual advertising".
The existing industry structure and traditional working
methods were holding back development, he said, but "the market will be
forced to switch to more efficient products". And he noted a similar
situation in 2008, when recession had forced clients into a "sudden
shift" into contextual advertising.
Yandex partnered with Google earlier this year to develop
display programmatic advertising in Russia. Google's advertising customers will
have access to Yandex's inventory and Yandex's ad customers will have access to
Google's DoubleClick Ad Exchange.
"We are still in the integration process for our
systems," Lomize noted, but he expected that both sides would benefit
while the market was growing fast. "There will be a moment later when we
shall have to start thinking in terms of competition," he allowed.
(Warc's new report, The Programmatic Primer, offers a guide
to this challenging subject. Readers can sign up for a related Warc webinar on
June 17 or view free sample content.)
If programmatic was still at an early stage, then mobile was
yet to reach even that. "There is a lot of buzz about it," Lomize
said, but "no results". Take-off was still a couple of years away.
For now, the focus for Yandex was on "making our
advertising user-centric", by knowing all the devices of a specific user,
and then it planned to move on to video advertising.
In a separate development, the company recently announced
plans to turn its Yandex.Direct service, which 19m Russians use to search for
goods offered online, into a full-scale shopping site.
Bloomberg reported that the business model would mimic
Amazon, with Yandex working alongside some 40,000 online stores, processing
payments and handling delivery.
Data sourced from Ad Exchanger, Bloomberg; additional
content by Warc staff
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