Editor’s note: This article originally appeared on East-West Digital News, a leading English-language resource on Russian digital industries and related venture activity.
Illustrating the trend of moving online in the Russian advertising market, search engine giant Yandex saw its advertising revenues equal those of First Channel (“Pervyi Telekanal”), the country’s leading TV channel, for the first time last year.
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According to First Channel’s annual financial results released earlier this week, the TV channel generated 28.2 billion rubles ($896 million) in advertising revenues in 2012, compared to Yandex’s 28.1 billion – including 25.5 billion from text-based advertising.
In 2011, First Channel generated 28.8 billion rubles, exceeding Yandex by almost 9 billion rubles ($300 million). But the search engine company begun surpassing First Channel in terms of audience as early as April 2012.
From an advertiser’s standpoint, however, TV and search engines should not always be regarded as competing for advertising expenditures, said Moscow-based Western marketing expert Bas Godska to East-West Digital News.
“Due to the noticeable price hike in online advertising over the last few years, TV has a lower cost when looking at cost per contact (reach). Yet from a performance marketing perspective focused on transactions in e-commerce, search advertising makes a lot of sense. If you have the budgets, you should definitely use both channels in tandem,” Godska explained.
“Google search advertising, for a range of product categories, is somewhat cheaper even though its click volumes in Russia are lower than Yandex,” he noted, referring to the US giant’s relatively small market share – around 25% – in Russia.
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