Rambler Media is a pure internet player. Its websites are among the most popular in Russia attracting a total of over 45 million unique visitors per month. Russia is one of the largest online communities in Europe and is set to become the largest in number of users in the next few years.
Rambler Media's main property is Rambler.ru (www.rambler.ru), a leading Russian language open portal, which provides best of class services available to the Russian online community. Rambler combines search and navigation functions with communication services and the latest in media and entertainment content. Rambler.ru serves as an open gateway to the web by aggregating best of class content and services and enabling the Russian speaking consumer audience to navigate to specific pages according to their interests.
Other properties owned by Rambler Media include the leading online Russian language news publisher 'Lenta.ru' (www.lenta.ru), product comparison website 'Price.ru' (www.price.ru), internet catalogue and navigation system 'Top 100' and contextual advertising company 'Begun'.
Rambler Media generates revenues primarily from advertising, which includes banner or display advertising, context display advertising and sponsored key word searches, e-commerce referral and product placement.
The Total Russian online advertising market reached around US$590 million (RUR14.7 billion) in 2008, thus growing 55% from 2007 and accounting for around 5% of the total Russian advertising market (MindShare Interaction).
DISPLAY ADVERTISING
Before 2008, Display Advertising on Rambler's pages was sold exclusively by Rambler's interactive agency Index20 (www.index20.ru), directly and through key advertising agencies.Rambler's Display Advertising capabilities have been strengthened through the Group's partnership with Video International's IMHO VI, announced in October 2007, to sell display advertising on Rambler's pages from January 2008.
Rambler announced in March 2008 that it had further reinforced its relationship with IMHO VI through the sale of a 51% stake in Index20 to IMHO VI. As a result of this, Index20 and IMHO VI are selling banner advertisements on Rambler's web pages in partnership with each other to further optimise Rambler's advertising revenues.
Rambler's top 20 advertising clients comprise many of the biggest internet advertisers in Russia - Russian and multinational brands alike; however, Rambler intends to capture a larger number of advertisers going forward and believes it has the right audience and products to capture an even greater proportion of each advertiser's budget.
The Russian internet display advertising is estimated to have grown by 45% year-on-year in 2008 to US$233 million (RUR5.8 billion) and accounted for 40% of total online spend.
CONTEXTUAL ADVERTISING
In 2005, Rambler Media introduced 'sponsored links search' and 'context advertising' through Begun (meaning 'Runner' in Russian) (www.begun.ru) and acquired a 25% stake in Begun.To strengthen its Contextual Advertising offering, Rambler Media acquired a further 25% stake in Begun in August 2007 for a cash consideration of US$18 million. This brought the Company's total stake in Begun to 50.1%, and thus Begun became a fully consolidated subsidiary of Rambler.
Begun is currently one of Russia's leading search and contextual text-based advertising platforms, with a network of 35,000 individual advertisers and over 50,000 partner distribution sites. The deal was significant for Rambler as it has enabled the Group to leverage its position in the text-based advertising market in Russia, which is estimated to have grown by approximately 60% in 2008 at US$358 million (RUR8.9 billion) and accounted for 60% of total online spending.
