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Presentation from a recent international marketing and ecommerce breakfast hosted by Borderfree in NYC
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Building Your Brand in Russia
2
Contents
Opportunity
Understanding the Russian consumer
Reaching the Russian consumer
Marketing case studies: KupiVip, ASOS
Recommendations
3
Russia is a HUGE market
• Broadband Households: 13.3M (25% households)• Mobile Phone Users: 108M (76% population)
77.5MInternet users
142.5M
Population
4
Millennial cities are key to ecommerce growth• Russia’s millennial cities (over 1 million people) will lead ecommerce growth• High concentration of Internet-savvy consumers, with more coming online every
day• Concentrated populations make it cheaper and easier to deliver packages to
consumers.
Mos
cow
St P
eter
sbur
g
Novos
ibirs
k
Yeka
terin
burg
Nizhny
Nov
goro
d
02468
101214
Population (million)
Population (million)
5
The time to act is nowEcommerce retail sales are taking off
• Ecommerce accounts for only 2% of country’s overall retail sales B2C
• Ecommerce sales will grow by over 21% in 2013
• Number of digital buyers will expand from 26.2 million in 2013 to 32.7 million in 2016
• Biggest growth potential in millennial cities
• In 2012 Russians spent $700M in cross border sales
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Understanding the Russian consumer
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Consumer behaviorWhat are Russians doing online?
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Consumer behaviorPreferred payment methods
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Russians have an appetite for luxury brandsTop selling brands
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Shoppers Without Borders Borderfree goes to Russia
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We’re listening…Customer feedback
Why can’t we buy UGGS
online
More DVF online
LOVE DKNY!
Need more quality
winter clothing
Want to be asked
whether I want to
shop in English or
Russian
3-4 shipping time frame is
enough
Childrenswear very expensive in Russia – only have Mothercare or high end designer
Regions don’t have great shops. Old season stock
Favorite brands: MJ, Michael Kors, Kate Spade
Read vogue and cosmo online
Starting to use PayPal online
Quick delivery times
Shop help most
important resource
12
Reaching the Russian consumer
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Russians prefer local media playersMost visited websites in Russia
• Dominant players in Russia are all homegrown firms
• Yandex controls search engine market
• Social media hugely popular –VK leading social destination
• 78% internet users will access a social network at least once a month
14
Yandex at a Glance#1 Search leader in Russia
• 61% market share in Russia
Number 1 search leader
• 44 million unique visitors per month• 44% Russian users homepage
Number 1 Internet destination
• 180k + advertisers• 58% online ad market share
Leading Online Advertising Platform
Largest Russian Internet business
• 40% Russian searches originate on Yandex Market• Yandex number 1 contextual ad placement in Russia• Optimizing SEM strategy on Yandex crucial to growing ecommerce
business• SEM unit costs are lower however conversion rates are also generally
lower
15
Media LandscapeMedia split in Russia
51%
14%
4%
16%
14%
1%TV
Internet
Radio
Press
Outdoor
Other
• Fastest growing EU marketing for online media spending
• TV still number 1, but digital has surpassed print in terms of spending
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Media LandscapeRussian magazines sorted by circulation
1. 980K 2. 730KRank Name Circulation
3 Maxim 390,000
4 Psychologies 360,000
5 Hello! 350,000
6 Good Housekeeping 230,000
7 National Geographic 230,000
8 ELLE 220,000
9 Cosmopolitan 200,000
10 Igromania 180,000
11 Men’s Health 160,000
12 Playboy 160,000
13 Vogue 150,000
14 L’Officiel 150,000
15 Elle Girl 140,000
16 XXL 140,000
17 Esquire 125,000
18 Marie Claire 125,000
19 Harper’s Bazaar 120,000
20 Tatler 120,000
21 Forbes 120,000
22 OK! 120,000
23 InStyle 120,000
17
Media LandscapeOnline Digital Platforms
• Shopping Forums• Shophelp.ru• Bigshopforum.ru• styleforum.ru• mixshopping.net• Shoppingzone.ru
• Magazines• Vogue.ru• Tatler.ru• Bazaar.ru• Trendspace.ru• Lookatme.ru
• Women’s portals• Woman.ru
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Media LandscapeShophelp.ru - Advertising
• Online shipping community for “shopaholics”. Biggest resource in Russia for shopping.
• Over 1,000,000 unique visitors per month, 10 million page views
• Display opportunities – promote shipping times/security/top brands
Over 8 million page views on display units
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Media LandscapeOnline digital platforms
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Media LandscapePR
Key Bloggers
• Miroslava Duma (owner, Buro)
• Vlasta Gurieva (Sophiegoesaround)
• Alexandra Rukovskaya (shopper)
• Anastasia Maltseva (shopper)• Laura Djaga (Vogue social
editor)• Live Journal blogging network• Buro 247 • Sophiegoesaround
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Marketing Case Study: KupiVip
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The Russian retail landscapeKey players: Domestic and Cross-border
Market Leaders
Cross-border
1. 30% 2. 28% 3. 18%4. 15%5. 5%
1.
2.
3.
4.
5.
6. Rutaobao.com7. Ebaytoday.ru8. Bay.ru9. Asos.com10. DX.com11. Tinydeal.com12. Mango.com13. Yoox.com14. Dealply.com15. Victoriassecret.com
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• One of the first online retailers to emerge in Russia, launched in 2008
• Launched as a member only Russian e-shopping club with daily flash sales
• 5 years later – 8.5 million members, $200 million net revenue with the aim of being a billion – dollar company by 2017
• Opened up Russian consumers to the world of online shopping
About KupiVip
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KupiVip: Marketing StrategyBrand awareness and direct response
Brand awareness
Strong PR presence across Russia
Brand partnerships
Sponsorships
Strategic alliances
Display campaigns
TV advertising
Social Media
Direct response
Extensive SEM presence
Yandex and Google
Mail.ru
Email acquisition – focus on consumer
data
Loyalty/Promotion driven
26
KupiVip: Social MediaBrand presence on domestic and international sites
• Largest following on VK.COM• Targeted ads across VK• Content replicated across networks
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KupiVip: Partnerships
Moscow Fashion Week sponsorship
Cross platform magazine collaborations
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KupiVip: Partnerships
Mnogo.ru – Russia’s first bonus program
Loyalty scheme powered by Russia’s coherent bank
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Marketing Case Study: Asos
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• Improve conversion rate with Russian paid search programs with translated landing pages• Educate the consumer on
safety of shopping via (credit card payments)
• Delivery times and security
• Delivery costs• How to shop online• How To Order - Russia
ASOS
32
ASOS: Marketing StrategyBuilding brand awareness
33
ASOS: Search StrategyBuilding brand awareness
34
ASOS: Marketing StrategyFocus on local sites
35
Summary of Recommendations4 Quick Wins: Building your brand in Russia
1. Develop a paid search strategy on both Google and Yandex
2. Translate landing pages to optimize conversion rates
3. Focus on brand awareness through local media players
4. Build a social strategy that includes local social media players
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