chapter 8 gsmm-russia

8/22/2019 Chapter 8 GSMM-Russia

1/22

Global Social Media Marketing: Russia

Overview

Whenever a revolution of global magnitude and importance takes place, the Russiansalways manage somehow to become the centrepiece of the action. According to a studyconducted by Comscore Global in 2011, the principal constituent country of the formerUSSR has the busiest and the most engaged social media audience in the whole wideworld. Let that sink in for a minute. Russians - believe it or not, are the most sociallyactive people on the World Wide Web!

The following gives you an idea of the reach, in terms of user base, that Russian Internet(Runet) had by the end of 2011.

It seems one simply can not keep the exploding demography of people in the age groupof 18 to 27 out of the pitch of play in this country. This new, young generation is drivingthe current socio economic evolution of Russia at a radical pace, breaking the shackles ofhistory and the attached perceptual stigma with global visibility and attention. And their

massive engagement with social media and online networking, more than anything else,is characterising these winds of change. Young Russians are now commenting, liking,tweeting, blogging, and speaking their minds in the cyber space more than ever before.

The following depicts the online presence various age groups had in the country at theturn of the last decade:


2/22

Online Demography

The insatiable need to network with fellow countrymen in Russia, now enabled by

technology and innovation, can be attributed to many things - the least of which wouldntbe the decades of economic subjugation, the continuing disillusionment with the statemachinery, and its government friendly mainstream broadcast media. But irrespective ofthe reasons, this new internet revolution has created a world of opportunities for onlinesellers, making it essential for them to generate a body of data that can be analysed toacquire an understanding of the biggest Russian social hubs online - and the localdynamics and idiosyncrasies they operate by.

When it comes to number of users, Russia has become the largest online market inEurope - having surpassed the UK in 2010, and more recently, Germany. According toComScore, in September 2011, there were 50.81 million users aged above 15 in Russia,

as against 50.14 million in Germany, 42.35 in France, and 37.2 in the UK. And by mid2012, there were over 67 million Russian nationals on the web.

The figure below depicts online penetration in Russia during the first decade of thecentury.


3/22

Contrast this with the following graph, which shows penetration trends at the end of2012.

Despite these impressive statistics, less than 50% of Russians had access to the internet,even at the end of 2012. On an average, Russian netizens spent less time online than theirEuropean counterparts in Germany and France. As per the 2011 ComScore numbers, theyclocked an average of 22.4 hours per month, as against 24.4 hours by the Germans, and27.2 hours by the French. The good news is - the Internet is spreading at a radical pace inthis country, seeing annual growths of up to 25% in the last few years. This, coupled withthe relatively low penetration levels till date, can only be indicative of the vast potentialthe country has for the web and technological growth in the near future.

In terms of urban internet usage, Moscow accounts for a major portion of the entireonline spectrum in Russia. The penetration and density of the internet and its users in thisarea is quite similar to other major western metropolitan cities.

The figure below illustrates a locality wise distribution of new additions to the onlinecommunity in Russia, in November 2010.


4/22

In 2011 however, 90% of the fresh additions came from areas outside major urbancentres such as Moscow and St Petersburg. The country generated the following

projected numbers just after a 5 month period.

And this is how country wide penetration looked like by spring 2012.


5/22

New additions to the online community in Russia are now occurring in massive numbersfrom all across the country, especially from areas where penetration has traditionallybeen low. Take a look at the graph below.


6/22

If the Russian Academy of Sciences is to be believed, internet penetration in this countryis poised to reach 75% by 2020, and 90% by 2030. The following chart represents theirInternet penetration projections for the period between 1995 and 2045, as of November

2011:

Mobile Internet Penetration

Another interesting fact is that more than 80% of Russians now own a mobile device. Ofthese, 25% are smart-phones, a proportion that is fast approaching figures in developedEuropean markets such as Germany, France, and the UK. By mid 2012, mobilepenetration in Russia had reached a growth rate of 159% - one of the highest in the world.

Although around 20% Russian mobile users were already accessing the web from their

devices by early 2012, mobile Internet use in the country was poised to grow even morerapidly in the future. According to GP Bullhound, the monthly mobile audience in Russiainflated by almost 100% in a matter of just 36 months between 2009 and 2012, when theoverall online audience grew by 50% during the same period.

Russians under the age of 24 are the largest consumers of advanced mobile data afterChina and the USA, claims Nielsen. And that is no mean achievement for a nation thathad one of the lowest consumer metrics in the world just a couple of decades ago. Byearly 2012, at least 8% of online purchases in Russia were being made from mobile andhand held devices.


7/22

By some accounts, there is more than one mobile phone for each citizen in Russia. Andthe rate at which smart phone technology and advanced mobile usage has startedpenetrating the country, it is hardly surprising that a metamorphosis is happening in theway businesses and government is communicating - both internally, and with the publicat large.

The Social Media Landscape

Peter Leighton of Interstice Consulting calls the Russians the most avid social mediajunkies in the world. He has offered a couple of interesting reasons why. He claims thatthe relatively low penetration of internet and online related communication in the countrysignifies that the current user base is the technological elite of the country, andtherefore, ever ready to gobble up any technological, internet, or communication productor service, including any new social media or online networking forums. A second reasonoffered by him is the easy and quick access to otherwise illegal multi media content, like

music and movies, through home grown social portals.

On an average, Russians were on social networking sites twice the amount of time thattheir global counterparts were, measuring 9.8 hours per month in 2010. A later report byComScore revealed that the number had surged to 10.2 hours a month in 2011, a figurethat is almost double the average time clocked by American users on similar portals.According to ComScore, 34.5 million Russian nationals visited at least one social


8/22

networking website in the month of August 2010. This was approximately 74.5% of thetotal online population of the country at that point in time.

Home Grown Social Networks

Another fact that became clear from the aforementioned ComScore study is, without ashadow of doubt local social media platforms are way more popular among Russiansthan the global ones. The most popular social networking services in Russia are thedomestic ones like Vkontakte.ru, Odnoklassniki.ru and Mail.ru. Vkontakte.ru came out asthe top rated social networking platform in Russia with 27.8 million users, followed byOdnoklassniki.ru that had a user base of 16.7 million back then.

The main characteristic that strikes you about these local portals is that although they arequite huge in size and operations, they are pretty insular to the rest of the internet and theinternational social media scene. These services are operated in the Russian language by

default, and are primarily aimed at providing social networking services amongst thenative speakers of the language, although language localisation options are as wide andstandardised as, say in Facebook.

These handful of sites have been successfully preventing the rise of the global playerssuch as Facebook, MySpace and Twitter in Russia - until recently. Russia is also one ofonly five nations on the planet where Google does not have a virtual monopoly oversearch engine and web based e-mail services. The big boys have finally started to realisethe magnitude of the challenge they face, however, and have now come up with biggermanifestos and better infrastructure for their operations over here.

A 2012 rating by VZIOM that accounts for just the number of users and discounts nonuser visits, concluded that Odnoklassniki is now the first among equals, followed closelyby Vkontakte. Both these social portals have developed their user base consistently overthe period between 2010 and 2012. The report also reveals an upsurge in user numbersfor My World, Facebook and Twitterin the country in recent times.


9/22

Almost 75% of the people that are now switching from local social networking platformssuch as Vkontakte and Odnoklassniki to global ones are under the age of 27. This is aclear indication of the desire of the new generation to interact with the rest of the worldand get a taste of global personalities, brands, people and politicians.

Local Search Engines

Russia is one of the very few nations - like China (that has its own major search enginecalled Baidu), which has been able to hold on to a dominant local search engine against amammoth global name like Google. Yandex, short for Yet Another Indexer, is Russiasvery own search engine that has kept Google guessing for quite some time now, and itdoes not seem to relent any time soon. Entities such as this have given the Russians asense of pride and evoked the latent nationalism in netizens all over the country. This,despite one of Googles co-founders - Sergeiy Brin, being of Russian origin.

Yandex continues to be the search engine of choice for all Russian speaking populations.It had a market share of 64% against Googles mere 22% in December 2010, according to

local statistical service LiveInternet.ru. What is interesting is that it has also quietly beenextending its tentacles across the globe, and at last count, had reached 56 million webusers all over the world.

Facebooks Performance

Name Usage among internet users in

2010 (in %)

Usage among internet users in

2012 (in %)

Odnoklassniki 72 73

Vkontakte 64 62

My world 22 31

Facebook 5 18

Twitter 2 9

Ya.ru 8 6

My Circle 7 5

Livejournal 5 3

Blog.ru 3 3

Liveinternet 4 2

Mamba.ru 4 2

MySpace 4 1


10/22

Now that Russia finally has the attention it deserves from the global biggies, things areslowly starting to shift towards a more balanced state of affairs. Facebook had a puny 2%market share in online social media in Russia even in 2009. But it managed to narrow thegap significantly thereafter. The number of users for almost all major global social mediaplatforms, including Facebook and Twitter, reportedly went up by almost 100% in 2010.

And after its formal local launch in Russia in January 2010, Facebook witnessed an evenfurther rise in its membership - a whopping 375%, in just the first four months.

By 2012 end, Facebook held a market share of over 20% in the country, and could boastof over 4.5 million users that visited the site on a regular basis. According toSocialBakers data from November 2012, there were 7,474,920 Facebook users in Russia,making it 29th in the country-wise demography size rankings. At that point, penetrationstood at 5.36% of total population and 12.52% of the online population of the country.The age group with the highest participation was the one between 25 and 34, with a userbase of 2,690,971.


11/22

The Facebook sex ratio in Russia in November 2012 stood at 48% male and 52% femaleusers.

The following info-graphic by SocialBakers is a comprehensive representation of the topsocial media marketing campaigns on Facebook and YouTube in the Russian context.


12/22


13/22

Twitters Case

The mild initial response to Twitter was another example of indigenous tendencies thatdefine the social media movement in Russia. The uptake for this world wide social media

phenomenon has been quite slow over here. Twitter has hardly achieved any numbersworth mentioning when it comes to commercial significance. There are nevertheless, afew big names in the public domain that are constantly bringing Twitter to the attentionof the public at large such as erstwhile President and current Prime Minister DmitryMedvedev.

There were about a million Twitter users in the country according to end 2011 data.However, a lot of the early joinees have now become disinterested in the service, just likethe Prime Minister himself. A study by Yandex revealed that only an appalling 6.4% ofthe Russia based Twitter accounts were being accessed on a daily basis in July 2011, asagainst 60% in March of 2010. As a fallout, Twitter had to introduce a localised Russianinterface for speakers of the language in April 2011. Not much could be expected from

this initiative though, as the interaction of Twitter users with the website had alreadydropped to critical levels.

While Twitter does not report its user accounts by country, it was listed as 17th in the listof the most popular websites in Russia by Alexa in October 2011. This can be read as a


14/22

bit of a positive overstatement in favour of the social networking site, when measuredagainst its actual popularity with Russian users.

The real reason for the unpopularity of Twitter in the country however, can be narroweddown to the basic premise and interactive concept of the site itself - Users here find it

difficult to fit their ideas in the 140 character cap unique to Twitter, and are unable toconvey or communicate meaningfully on account of the relatively lengthy alphabet useprevalent in the Russian language. They would rather play online social games such asTuryaga (Prison) on Vkontakte, the erstwhile leader in online social games, which had aparticipant base of over 8.7 million even at the end of 2011.

Blogging: The LiveJournal Revolution

LiveJournal on the other hand has found unlikely popularity with hoards of Russianjournalists and intellectuals that seek free and fair expression of ideas and opinions

online. Although not a social media site per se, LiveJournal has emerged as one of the topsocial networking platforms of choice for Russians - one that is largely being used as ablogging platform that focuses on the content created by the members, but which alsocontains additional social media features.

LiveJournal is a sole exception to the largely indigenous Russian social networking scene- a site with a .com in it, but made their own by Russian users who fondly refer to it bythe Russian initials . According to LiveJournal itself, the Russian version of thesite had more than 35 million users, over 5 million Cyrillic accounts, and at least 250million monthly online posts by early 2012.


15/22

Who Controls Online Social Media in Russia?

A discussion on the broader state of play in online social media in Russia and the prosand cons of the different service providers in the country would be incomplete withoutmentioning a pivotal fact - the final control of most such online outlets in Russia rests

with a single individual, the oligarch Alisher Usmanov. He is the main financier behindDigital Sky Technologies, the company that owns the lions share in VKontakte, andMail.ru the banner under which Odnoklassniki and MoiMir operate.

In 2007, Usmanov took over LiveJournal.com via SUP Media, a Russian company that isjointly owned by him and Alexander Mamut. He also acquired important minority stakesin Facebook and Twitter on their launch in the country. Usmanovs social mediaconnections reach out to operators such as Groupon, Spotify and Zynga as well.

Opportunities for Digital Marketers

The standards of living and the purchasing power of Russians are ever increasing. In2010, approximately 80 million web users in Russia spent more than 20 million euros forpurchasing stuff online. This kind of economic change is finally giving rise to a kind ofaspirational advertising in the country.

For decades, advertising was treated as a logistical necessity in Russia, used simply to letthe consumers know when and where a product is available. It could never realise itspotential as a promotional tool for manufacturers and service providers. That is no longerthe case however, as the current period is witnessing a shift to the kind of advertising thatproactively promotes and markets products and services.

Until recently, marketing competition was pretty much non-existent in Russia, with onlya few foreign companies in the fray. This translates into extremely cost-effective andhigh-return online marketing opportunities in the country. Deprived of a consumer centriceconomic system for decades, Russians are - by default, instant potential consumers ofany new product or service in the first place.


16/22

The good news for online marketers is that the Internet is fast turning into the mostimportant forum for advertisement and marketing in Russia, given the booming onlineaudience in the country. With the aforementioned dynamics in the mix, online marketerscan work with smaller budgets while generating a greater impact over here, whencompared to other major markets. The price of a thousand shows for an online banner in

Russia for instance, is still approximately 10 cents, give or take.

The following chart portrays the audience size in both the European and the local context.

In 2010, the total value of the advertising industry in Russia was estimated at around $7.5billion. Of this, almost 11% went to online ads - you can do the math. However, as of2011, the online advertising market in Russia was still at its nascent stages. Digitalmarketing campaigns were still at only about 10% of the overall advertising budget in the

country. Contrast that with a relatively developed market such as the UK, where itaccounted for 26% of the total expenditure during the same period.

Despite that, spending on Internet marketing is on the rise, and quickly too. Searchengine advertising is a major driving force, making up 53% of the advertisingexpenditure online. Yandex continues to outshine Google with its 61% market share, asagainst the latters 26%. According to the Russian daily news outlet Kommersant, in


17/22

2012, the market was expected to grow to around $10 billion, with expenditure on onlinemarketing pegged at a minimum of 13% of that figure.

Look at the illustration below for an idea on the scope of targeted online marketing inRussia.

In addition, traditional business entities too are slowly but surely, gravitating towardsweb and mobile advertising in order to grab the attention of the massive online audiencein the country. Massive investments in online content, gaming, and e-commerce are onthe anvil. E-commerce in fact, is growing at over 16% per annum here.

The following is a depiction of Russias e-commerce potential as of 2011.


18/22

A research on Russian contextual advertising markets was conducted in 2011 by theRussian Internet advertising platform Begun.ru. According to the study, internetmarketing and contextual advertising showed tremendous growth during the previousyear. Russia gained two places to climb to second position from fourth in internet

advertising on a worldwide index.

Mike Read, the Senior VP and Managing Director for ComScore Europe, had this to sayabout the scope of social media marketing in Russia:

The substantial growth in the Russian social media sector provides a sizeable advertisingopportunity and reflects the importance of online connectivity for the Russianpopulation.

Tips for Online Marketers

Social networking sites are finally in the crosshairs of marketers for targeted onlineadvertising for Russian speaking populations. Any tailor made marketing campaign forthis region however, can not afford to lose sight of the importance of localisation for theirpromotional content. This will always present a challenging professional environment forthe concerned communications and creative experts. Here are a few important guidelinesthat will hold them in good stead while plying their trade in the region.

When it comes to online penetration, social networking websites - earlier local,

now increasingly the global ones, still rule the roost in Russia, followed closelyby blogging sites a la LiveJournal.com.

Many international brands have already started targeting the Russian speaking

online market by establishing localised web profiles, which includes adjacentRussian speaking countries and expat populations.

Most existing digital marketers have not done enough to invest in long term

relationships here, and are mostly simply replicating their pre-existing web basedpromotional content, resulting in a lot of failures.

Companies such as Google, Yandex, and Begun.ru are recommending some new

formats for advertising in videos, mobile devices, websites, applications, and geo-

location services specific to Russia.

Large parts of Russia still being rural - with population pockets that are few and

far between, the challenge for online marketers is to come up with ideas with reallife elements that affect the target audience directly.

Digital ads need to be adequately localised. A campaign developed for Moscow

for instance, will not make much sense in somewhere like Siberia.


19/22

Consistent, interesting, and professionally written Russian content will appeal to

the target audience, and result in a higher number of returning users.

Marketers need to consider demographic parameters while conceptualising an

online campaign, factoring in Russias varying ethnicities, languages, and culturalnuances.

The following info-graphic presentation from RussianSearchTips will give you somemore pointers.


20/22

References

Dallas Lawrence:www.mashable.com/2011/06/20/russia-social-media-marketing

Russia Now Europes Leading Internet Market by Number of Users by Adrien Henni,East-West Digital News, Nov 15, 2011:www.ewdn.com/2011/11/15/russia-now-europes-leading-internet-market-by-number-of-users
http://www.mashable.com/2011/06/20/russia-social-media-marketinghttp://www.ewdn.com/2011/11/15/russia-now-europes-leading-internet-market-by-number-of-usershttp://www.ewdn.com/2011/11/15/russia-now-europes-leading-internet-market-by-number-of-usershttp://www.mashable.com/2011/06/20/russia-social-media-marketinghttp://www.ewdn.com/2011/11/15/russia-now-europes-leading-internet-market-by-number-of-usershttp://www.ewdn.com/2011/11/15/russia-now-europes-leading-internet-market-by-number-of-users


21/22

Already Europes Largest Internet Market and Still Growing Astoundingly Fast: Russiaby the Numbers by Robin Wauters, April 20, 2012:www.thenextweb.com/eu/2012/04/20/already-europes-largest-internet-market-and-still-growing-astoundingly-fast-russia-by-the-numbers

Rohit Bhargava:www.rohitbhargava.com/2009/06/8-interesting-things-about-marketing-social-media-in-russia.html

Russia Facebook Statistics:www.socialbakers.com/facebook-statistics/russia

Leighton Peter Prabhu:www.dreamgrow.com/social-media-in-russia

SeoRussia 2012:

www.seorussia.com/category/advertising

The State of Online Marketing in Russia by Chris Sherman, Feb 15, 2011:www.searchengineland.com/the-state-of-online-marketing-in-russia-64865

Images

Russian SEO and search marketing agency Ingate:www.promo.ingate.ru

Russia Is Now An Internet Society: Exposing Western Myths About Russia by DaRussophile, September 3, 2012:www.darussophile.com/2012/09/03/russia-is-now-an-internet-society

Already Europes Largest Internet Market and Still Growing Astoundingly Fast: Russiaby the Numbers by Robin Wauters, April 20, 2012:www.thenextweb.com/eu/2012/04/20/already-europes-largest-internet-market-and-still-growing-astoundingly-fast-russia-by-the-numbers

Understanding Russia by Karolina Filip on October 11, 2011:blog.netrefer.com/?p=921

Russia Facebook Statistics:www.socialbakers.com/facebook-statistics/russia

Social Media Statistics of Facebook & YouTube for brands in Russia - January 2012:www.socialbakers.com/blog/387-social-media-statistics-of-facebook-youtube-for-brands-in-russia-january-2012
http://www.thenextweb.com/eu/2012/04/20/already-europes-largest-internet-market-and-still-growing-astoundingly-fast-russia-by-the-numbershttp://www.thenextweb.com/eu/2012/04/20/already-europes-largest-internet-market-and-still-growing-astoundingly-fast-russia-by-the-numbershttp://www.rohitbhargava.com/2009/06/8-interesting-things-about-marketing-social-media-in-russia.htmlhttp://www.rohitbhargava.com/2009/06/8-interesting-things-about-marketing-social-media-in-russia.htmlhttp://www.socialbakers.com/facebook-statistics/russiahttp://www.dreamgrow.com/social-media-in-russiahttp://www.seorussia.com/category/advertisinghttp://www.searchengineland.com/the-state-of-online-marketing-in-russia-64865http://www.promo.ingate.ru/http://www.darussophile.com/2012/09/03/russia-is-now-an-internet-societyhttp://www.thenextweb.com/eu/2012/04/20/already-europes-largest-internet-market-and-still-growing-astoundingly-fast-russia-by-the-numbershttp://www.thenextweb.com/eu/2012/04/20/already-europes-largest-internet-market-and-still-growing-astoundingly-fast-russia-by-the-numbershttp://www.blog.netrefer.com/?p=921http://www.socialbakers.com/facebook-statistics/russiahttp://www.socialbakers.com/blog/387-social-media-statistics-of-facebook-youtube-for-brands-in-russia-january-2012http://www.socialbakers.com/blog/387-social-media-statistics-of-facebook-youtube-for-brands-in-russia-january-2012http://www.thenextweb.com/eu/2012/04/20/already-europes-largest-internet-market-and-still-growing-astoundingly-fast-russia-by-the-numbershttp://www.thenextweb.com/eu/2012/04/20/already-europes-largest-internet-market-and-still-growing-astoundingly-fast-russia-by-the-numbershttp://www.rohitbhargava.com/2009/06/8-interesting-things-about-marketing-social-media-in-russia.htmlhttp://www.rohitbhargava.com/2009/06/8-interesting-things-about-marketing-social-media-in-russia.htmlhttp://www.socialbakers.com/facebook-statistics/russiahttp://www.dreamgrow.com/social-media-in-russiahttp://www.seorussia.com/category/advertisinghttp://www.searchengineland.com/the-state-of-online-marketing-in-russia-64865http://www.promo.ingate.ru/http://www.darussophile.com/2012/09/03/russia-is-now-an-internet-societyhttp://www.thenextweb.com/eu/2012/04/20/already-europes-largest-internet-market-and-still-growing-astoundingly-fast-russia-by-the-numbershttp://www.thenextweb.com/eu/2012/04/20/already-europes-largest-internet-market-and-still-growing-astoundingly-fast-russia-by-the-numbershttp://www.blog.netrefer.com/?p=921http://www.socialbakers.com/facebook-statistics/russiahttp://www.socialbakers.com/blog/387-social-media-statistics-of-facebook-youtube-for-brands-in-russia-january-2012http://www.socialbakers.com/blog/387-social-media-statistics-of-facebook-youtube-for-brands-in-russia-january-2012


22/22

2012: Taking Over the World by Priit Kallas:www.dreamgrow.com/facebook-statistics-2012-taking-over-the-world

Where Twitters Next Big Boost is Coming From, June 22, 2010:

www.royal.pingdom.com/2010/06/22/where-twitters-next-big-boost-is-coming-from

LiveJournal: Russia's Unlikely Internet Giant by Robert Greenall - BBC, March 1, 2012:www.bbc.co.uk/news/magazine-17177053

Posted by Anna in Russian eCommerce:www.russiansearchtips.com/2012/07/ecommerce-in-russia-infographics

Article:www.socialbakers.com/facebook-statistics/russia

Blog:www.thesocialpenguinblog.com/2012/02/28/how-are-russians-using-social-media
http://www.dreamgrow.com/facebook-statistics-2012-taking-over-the-worldhttp://www.royal.pingdom.com/2010/06/22/where-twitters-next-big-boost-is-coming-fromhttp://www.bbc.co.uk/news/magazine-17177053http://www.russiansearchtips.com/2012/07/ecommerce-in-russia-infographicshttp://www.socialbakers.com/facebook-statistics/russiahttp://www.thesocialpenguinblog.com/2012/02/28/how-are-russians-using-social-mediahttp://www.dreamgrow.com/facebook-statistics-2012-taking-over-the-worldhttp://www.royal.pingdom.com/2010/06/22/where-twitters-next-big-boost-is-coming-fromhttp://www.bbc.co.uk/news/magazine-17177053http://www.russiansearchtips.com/2012/07/ecommerce-in-russia-infographicshttp://www.socialbakers.com/facebook-statistics/russiahttp://www.thesocialpenguinblog.com/2012/02/28/how-are-russians-using-social-media

chapter 8 gsmm-russia

Documents