This past Wednesday Yandex and Google, the two archivals of the Russian search market, announced a “mutually beneficial strategic partnership agreement” in the field of online display advertising sales.
As a result of the integration of Google’s and Yandex’s real-time bidding (RTB) systems, Google’s advertising clients will gain access to the advertising inventory offered by publishers in Yandex’s advertising network, while Yandex’s advertising clients will be able to bid for display inventory in the DoubleClick AdExchange.
The agreement, which relates only to display advertising on the companies’ respective ad networks, does not cover text-based contextual advertising. It will affect all publishers who have RTB-connected online inventories.
While such publishers have not been numerous in Russia so far, this Google-Yandex partnership will make the local Russian market more easily accessible to newcomers, as the additional Yandex RTB tech-adaptation barrier to entry will vanish.
Higher integration with higher costs?
“I heartily welcome this alliance, which will further remove technical and operational barriers between Russia and Google’s global RTB ecosphere,” commented Bas Godska, managing director of myThings Russia, a global RTB-player active in Russia since early 2011 in the personalized dynamic retargeting arena. “For myThings this may lower investments in further technical integration and maintenance requirements.”
Godska agreed that the Google-Yandex partnership is likely to attract more advertisers to the Russian market. “Let’s hope that new flows won’t cause the cost per conversion to rise as acquisition costs have risen for demand-side platforms (DSPs) and their e-commerce clients,” the Dutch marketing expert said in his exchange with East-West Digital News.
Such fears seem to be supported by Yandex itself, which does not hide that the partnership with Google aims to “boost revenues for the most sought-after advertising spaces.”
When the Google-Yandex partnership will actually be implemented remains unclear, however. “When Yandex launched RTB in 2012, it took a while between press release, modest launch and actual full-scale operations,” noted an industry expert.
Yandex launched its own RTB system two years ago. Yandex.Direct, its contextual ad offer, and myThings were pioneer participants in the auction. They were later joined by Tinkoff Digital, the developer of Russia’s first RTB platform, and Lamoda.ru, a popular fashion e-retailer in Russia.
