Recovery of tolerance for Internet advertising Media consumption in Russia Deloitte CIS Research Center Moscow 2018

Transcription

1 Recovery of tolerance for Internet advertising Media consumption in Russia Deloitte CIS Research Center Moscow

2 Contents 0 Introduction 3 3 Advertising perceived loyalty and usefulness of advertising media 32 Advertising usefulness by product category Methodology 4 Key findings 5 Media consumption in Russia 8 Media consumption by category 9 Russians as media users 2 Media usage during the day 3 Media consumption practices 4 Changes in media consumption in News sources 8 Media source ranking by trust level 9 Attitude towards the mass media: Russian or foreign source? 20 The most popular content by media 2 Frequency of Internet visits Tolerance to Internet advertising Key reasons for blocking Internet ads 39 Key reasons to reject Internet ad blocking 40 Conduct-based approach to handling Internet ads 4 Key factors to reject Internet ad blocking Online purchase by product category 44 benefits 45 challenges Attitudes towards new gadgets 25 Russian household ownership of media devices 26 Popularity of smartphone features 28 Messengers 29 Access to media by connection type 30 02

3 Media consumption in Russia Introduction Olga Tabakova Partner CIS TMT Industry Leader Deloitte CIS We are pleased to present the results of our fourth comprehensive study in Russia. Every year we look at media consumption across nine key channels. Our figures show that the Internet usage is still growing. While the audience growth for this media channel has slowed down substantially, users demonstrate increasing engagement levels and the range of their activities continues to grow. For example, certain population groups consume TV and radio content entirely through the Internet, creating new challenges and opportunities for the media business. Companies have vastly boosted their activities online, especially in the area of advertising and SMM. However, this trend has a negative effect: our respondents state that online ads are becoming more aggressive and concentrated. Last year we noted a significant decline in tolerance towards advertisements from this media channel. This created a need to find a balance so that the users comfortably spend time online while content producers could still generate profits. As the result of these user-friendly programs and efforts, tolerance towards Internet advertising jumped by five percentage points in. At the same time, a certain improvement in sentiment is accompanied by extensive use of ad blockers, with one in three Russians using such programs. Accordingly, businesses now face an additional challenge of reaching their target audience while discouraging it from ad blocking. In this study, we focused on the most annoying ad types, the reasons for using/ not using ad blockers and the conditions for discontinuing ad blocking practices. We hope that the trends we have identified will be useful to businesses as they develop a strategy to work with their current and potential customers. The use of data collection and analysis methods combining both qualitative (i.e. focus groups and interviews) and quantitative (a nationwide survey) approaches allowed us to obtain a deeper understanding of the trends and map out potential areas where these findings can be leveraged by the market. We will be happy to provide you with a full version of this report (tailor-made individually for each client to take into account their goals and objectives) with in-depth data analysis and significant distinctions highlighted between federal districts, major cities such as Moscow and Saint-Petersburg, cities with a population of over a million and various socio-demographic groups and categories. If you are interested in the full version of this report, please contact us at cisresearchteam@deloitte.ru. SMM (Social Media Marketing) is the use of social media to promote a product or a service. 03

4 Media consumption in Russia Methodology Purpose of research: A study of Russian media consumption trends. Target audience: Russian nationals over 6 years of age that are Internet users (as this was the data gathering method) [ Russians ]. Limitations of research: Our sample may not fully reflect country-wide media consumption habits, due to the limited Internet penetration among Russians. Research goals Highlight the nature of shifts in the Russians media consumption over the last four years (205 ); Take a detailed look at Russians media behavior in terms of information channels they use, their preferred topics, the time spent and other criteria; Assess the Russians level of trust in various information sources; Analyze what types of devices are used to browse media content; Look at how the Russians make online purchases; Data collection methods We used the following qualitative and quantitative data collection methods for the goals mentioned above: Online sample surveys that match the socio demographic portrait of the Russian population (,600 respondents); Expert interviews with representatives from the leading high-tech, telecommunications, entertainment and media companies Two focus groups with participants from eight age categories (from 8 to 55). Research sample Multistage and stratified sample of the Russian population according to gender, age and the type of population center where they live,600 persons, representing eight federal districts, 46 regions, and at least 250 population centers. Assess the Russians tolerance for advertising, including by type of media activity; Compare identified consumer profiles in relation to different media sources. According FOMnibus, Internet penetration among 8+ Russians was 72% in the summer of. 04

5 Media consumption in Russia Key findings Media consumption patterns Change in media usage In 205, average outreach for the nine selected media channels remained at 53% Moscow is leading in terms of media outreach (on average for all nine channels) Media outreach is higher for men than for women Employed respondents consume media more actively than the unemployed. Share of users, 60% Share of users, 56% Employed 54% 5% Moscow Men Women 45% Unemployed Overall, media usage grew by +6% Growth in media usage in Decline in media usage in Internet E-books Internet E-books +59% +29% -26% -2% Russians of all ages name the Internet as the key source of information in Top 3 news sources Internet (news, analytics and official websites) 79% Television 67% Internet (social media and blogs) 30% Top 3 Internet resources 2 VKontakte YouTube 70% 62% Odnoklassniki 42% Video games and printed Printed media media audiences 57% 44% continue to decline Video games % % Between 205 to the pace of decline of printed media usage accelerated. The decline of radio usage stopped in. Printed media -7% 205 Radio -26% -7% 0% 205 Internet preferences by age 2 VKontakte Instagram 9% Aged % Aged % Over 65 % Over 65 Facebook 8% Aged 6 24 News websites 3% Aged % Over 65 5% Over 65 Based on the media usage index: [proportion of those who have indicated a more frequent use minus proportion of those who have indicated a less frequent use] 2 Proportion of the respondents who have indicated the Internet resource as the key one.

6 Media consumption in Russia Key findings Technology dimension Online purchases Messengers are the most in demand smartphone feature among Russians 75% of Internet users shop online There is a shift in Internet usage, with smartphones used for longer connections Smartphone 35% % Proportion of the respondents who often go online for long periods with smartphone Growth in the usage Messengers of smartphone +40% functionality 2 Mobile calls Internet calls +30% +9% Social network apps +5% Usage index 2 Increasing penetration Smartphone of smartphones 87% Messengers have gained popularity over the year WhatsApp Viber Telegram 72% % % 207 7% 207 The proportion of Russians using messengers 58% 38% % Top 3 product categories purchased online 3 Games, movies and software 37% Top 5 advantages of online shopping possibility to compare products and prices across various stores possibility to get product information and read external customer reviews cheaper prices faster shopping 24/7 working hours Electronics 9% Top 5 disadvantages of online shopping Home appliances 4% difficulties in assessing physical characteristics of products (size, material quality) discrepancies in size and quality vs advertised or sale of counterfeit products long delivery after ordering complicated return procedures Based on the usage index [proportion of those who own and use a device minus proportion of those who own a device without using it] general lack of trust in products purchased online 2 Based on the feature usage index [proportion of those who have indicated a more frequent use minus the proportion of those who have indicated a less frequent use] 3 Proportion of the respondents who generally shop online by product category.

7 Media consumption in Russia Key findings Online ad blocking 37% of Internet users block online ads Smartphone/tablet 7% Ad blocking software % In-browser ad-blocking tools Computer/laptop 2% Ad blocking software 5% In-browser ad-blocking tools Recovery of tolerance Internet for online advertising -5% 0% after a decline in Total: 7% Total: 36% Key reasons for blocking Internet ads The most annoying types of advertisements Annoying advertisements Too Much advertising Full-screen banners Commercials interrupting videos Pop-up banners 44% 39% RUB 300 Almost half of those using ad blockers would leave a website if it limits access to content when an ad blocker is running Potential demand for fee-based Internet ad blocking services Acceptable fees for online ad blocking service (only respondents willing to pay) Videobanners with sound Based on the advertising loyalty index: [proportion of those favoring advertising minus the proportion of those who disapprove]

8 Media consumption in Russia Media consumption by category Russians as media users Media usage during the day Media consumption practices Changes in media consumption in 205

9 Media consumption in Russia Media consumption in Russia Media consumption by category Which of the following types of media have you consumed in the last two weeks (percentage)? Trend Highlights Internet Television Radio Video games Printed media Printed books E-books Cinema Theater/concert * Due to data collection method (an online survey) Moscow St. Petersburg Major cities Cities and towns Men Women Respondents who live alone Respondents who do not live alone 0 * Pensioners Students 0 * Unemployed respondents Employed respondents Respondents with secondary education 0 * Respondents with master s or bachelor s degrees 0 * Average audience reach 53% In, average media reach in Russia remained at 53%, down 2 pp from last year. A decrease in video games and printed media consumption (down 8 pp and 3 pp from 205, respectively) remains a stable trend. Attendance of theaters and concerts grew by 4 pp over the last two years Do you play video games? It s a relic of the past. I don t play, but I have many friends aged who play FIFA on PlayStation. They all are keen on sports, football. No, I don t play games as it s a waste of time. Focus group (aged 8 35) About media consumption: I live my life in parallel with my Internet browser: at the same time I can watch a movie on my laptop, read something on my tablet, answer text messages on my smartphone, etc. Focus group (aged 36 55) The highest media consumption is in Moscow (60%), and, on the average, people living in cities with a million+ population are more active when it comes to media usage: 55% vs 5% in smaller cities and towns. Men are more active in using various media channels than women (54% vs 5%). It is interesting to note that respondents who live alone are less active media users than those who don t (a 7 pp difference). Pensioners and unemployed respondents are the least active media users (8 pp below the average). Respondents with a bachelor s or master s degree are significantly more active in using media channels than their less educated peers (an 8 pp difference). Media consumption by category Russians as media users Media usage during the day Media consumption practices Changes in media consumption in 205 Average audience outreach for the 9 selected media channels.

10 Television Radio Printed media Video games Patterns Television is less popular with respondents in Moscow and St. Petersburg as compared to other cities (3 4 pp below the average). Television is also much less popular with youngsters aged 6 9 (3 pp below the average). Changes in media consumption Over the past year television has become more popular with youngsters aged (up 8 pp) and residents of the Southern Federal District (up 6 pp). Patterns Radio is most popular with respondents in Moscow (72%). It is interesting to note that radio is more popular with men than with women (a pp difference) and with the employed vs the unemployed (a 2 pp difference). The least active radio listeners are residents of the Far Eastern Federal District (by 5 pp) and youngsters aged 6 9 (by 6 pp). Changes in media consumption Over the past year there has been a decrease in the share of radio listeners, except for those aged (+9 pp) and aged (+4 pp). Patterns Printed media is more popular with people living in Moscow (6 pp above the average). Consumption of printed media remains below average among residents of the Urals Federal District (by 9 pp), students (by 4 pp), unemployed people (by 8 pp), and those who live alone (by 2 pp). Changes in media consumption Over the year there has been a significant decrease in the consumption of printed media by residents of St. Petersburg (-9 pp) and the Urals Federal District (-2 pp). Moreover, printed media has become less popular with people who live alone (-9 pp), and pensioners (-3 pp). Patterns Moscow residents (8 pp above the average) and employed Russians (6 pp above the average) are the most active video game players. Besides, men play video games more often than women (by 6 pp). Because the proportion of women in Russia s population is higher than that of men, among video game players they account for as much as 45%. Changes in media consumption Over the past year, video games have become less popular in the Far Eastern Federal District (-4 pp). Video games have become more popular among Russians aged (45% and up 2 pp against the previous year), while other age categories are less active video game players. Media consumption by category Russians as media users Media usage during the day Media consumption practices Changes in media consumption in 205

11 Media consumption in Russia Media consumption in Russia E-books Printed books Cinema Theaters/concerts Patterns E-books are more popular with residents of St. Petersburg than in Russia as a whole (by 8 pp). Besides, reading is more popular with youngsters aged 6 9 (by 5 pp). The least active e-book users are people over 65 (27%), unemployed Russians (30%) and respondents with secondary education (3%). Changes in media consumption Growth in e-book consumption is seen among youngsters aged 6 9 (+9 pp) and residents of St. Petersburg (+ pp), while Moscow residents read e-books less frequently (- pp). Patterns Printed books are most popular with youngsters aged 6 9 (54%) and people over 65 (49%). Printed books are not that popular with unemployed people and respondents with secondary education (9 pp and pp below the average, respectively). Changes in media consumption Decline in printed book consumption is generally seen among residents of St. Petersburg (-7 pp) and Russians aged (- pp) with a growth in printed book consumption among youngsters aged 6 9 (+2 pp). Patterns People living in large cities, including Moscow and St. Petersburg, go to the cinema more often than those living in other Russian cities and towns (by 9 pp). People living in the North Caucasian Federal District go to the cinema less often (by pp). People aged (+9 pp), and people who live with their children (+7 pp) go to the cinema more often. Russians over 55 are less active cinema visitors (-3 pp). Changes in media consumption Over the past year, cinemas have become less popular among people living in St. Petersburg (-8 pp), and those aged (- pp). Patterns Theaters and concerts are most popular among people living in Moscow, St. Petersburg and other large cities (+7 2 pp above the average). Theaters are less popular among Russians aged 6 24 (-6 pp) and those over 65 (-8 pp). Respondents with a bachelor s or master s degree are more active theatergoers than those with secondary education (+ pp). Changes in media consumption This year has seen a significant increase in theater going by residents of the Siberian Federal District (+7 pp) and those people who live alone (+8 pp). Media consumption by category Russians as media users Media usage during the day Media consumption practices Changes in media consumption in 205

12 Media consumption in Russia Media consumption in Russia Russians as media users Would you describe yourself as an active media user who watches TV, reads printed and electronic media, listens to the radio and browses the Internet on a regular basis? Please select what applies to you best. Yes, I am an active media user who shares news with friends/colleagues/acquaintances when communicating face to face or online (social networks, blogs, online fora, etc.) Yes, I am an active media user. However, I prefer sharing news with friends/colleagues/ acquaintances when meeting them face to face Yes, I am an active media user. However, I prefer sharing news with friends/colleagues/ acquaintances when communicating online (social networks, blogs, online fora, etc.) Yes, I am an active media user. However, I do not usually discuss news with friends/ colleagues/acquaintances or share them online The share of the most active users: 86% % % % Trend The share of the most active media users has increased insignificantly over the past year (up 2 pp) reaching 86%. The respondents prefer to share information both face-to-face and online (43%), and every third (34%) shares news only during face-to-face meetings. The share of those who prefer online communication to face-to-face contract remains rather low, at 9%. Highlights People aged 6 29 are the significantly more active media users compared to the older generation (the share of active media users is 92%) and more often share news both online and during face-to-face contacts (+ pp on the average). People aged are active media users (84%), but prefer face-to-face contracts to online communications (+8 pp above the average). People over 60 are the least active media users (79%), and every fifth respondent (2%) in this group prefer not to share news either online or during face-to-face meetings. Media consumption by category Russians as media users Media usage during the day Media consumption practices Changes in media consumption in

13 Media consumption in Russia Media consumption in Russia Media usage during the day What is your preferred type of media? On work days Television Radio Internet E-books Printed media Printed books Video games Nothing from mentioned above 6am to 9am 22% 5% 28% 2% 3% % % 28% 9am to 2pm 9% 4% 49% 3% 5% 3% % 6% 2pm to 6pm 8% % 54% 5% 4% 3% 3% 3% 6pm to 9pm 30% 5% 38% 8% 4% 5% 6% 4% 9pm to midnight 29% 2% 34% 8% 5% 6% 8% 8% Midnight to 6am 6% 2% 4% 4% % 3% 4% 66% Average time spent per day Work day 3 hours 53 min Weekend 4 hours min Work day 2 hours 32 min Weekend 3 hours 30 min Work day hour 40 min Weekend hour 27 min Work day 54 min Weekend hour 04 min The Internet remains a dominant media channel on work days and during weekends. It is seen from the average usage period, which is much longer than of any other media channel. However, it should be noted that the difference in the Internet usage periods on work days and during weekends is insignificant (4 min), while the television usage period is almost one hour longer during weekends than on work days (58 min). On the contrary, Russians listen to the radio more often on work days than during weekends (+3 min). Media consumption by category Russians as media users Media usage during the day Media consumption practices Changes in media consumption in 205 On weekends 6am to 9am 9% 7% 9% 2% 3% % % 48% 9am to 2pm 25% 9% 39% 4% 4% 3% 3% 3% 2pm to 6pm 6% 7% 47% 6% 4% 4% 6% % 6pm to 9pm 27% 4% 39% 7% 5% 4% 7% 7% 9pm to midnight 30% 2% 32% 8% 4% 7% 8% 9% Midnight to 6am 6% 2% 4% 3% 2% 4% 4% 65% Most active Fairly active Least active 3

14 Media consumption in Russia Media consumption in Russia Media consumption practices Television Internet Radio I turn the TV on to watch a program. If there is nothing interesting, I just leave it in the background and/or watch a TV program that seems to be the most interesting I turn the TV on to watch a specific program I turn the TV on to watch something. If there is nothing interesting, I turn it off. I use the TV as background I only watch TV when I have company Work day Weekend I often go online for long periods I often go online, but do so for short periods I rarely go online, but do so for long periods I rarely go online and do so for short periods PC Tablet TV I listen to the radio while driving I listen to the radio at home I listen to the radio at work I listen to the radio while on public transport I listen to the radio while going for a walk Work day Weekend Printed media Media consumption by category Russians as media users Media usage during the day Media consumption practices Changes in media consumption in 205 Laptop Smartphone The share of respondents who frequently use their smartphones for long Internet connections has been growing for the second consecutive year (+5 pp from 206), while the share of respondents who use a PC or a laptop for Internet connections is going down (-9 pp and -5 pp in the past two years, respectively). It makes smartphones the major Internet traffic channel. I read freely available printed media I sporadically purchase certain printed media I read what my friends/colleagues/relatives buy I purchase certain printed media on a regular basis I purchase printed media to pass the time I have subscriptions to certain printed media

15 Media consumption in Russia Media consumption in Russia Changes in media consumption in 205 The media usage index How would you describe the change in your media consumption rate over the last three years? Internet E-books Higher usage Average index Theaters/concerts Cinema Video games Radio Television Printed books Printed media Lower usage Trend According to the respondents, in the consumption of the Internet (the usage index of +59%) and e-books (the usage index of +29%) is still growing. At the same time, based on the subjective perception of media consumption, there is a significant decline in the usage of printed books (-2%), printed media (-27%), and television (-7%). In, the popularity of theaters and concerts has increased. Since 205, the radio popularity decline rates were slowing down gradually (from -7% to 0%), and the usage of this media channel has stabilized by. In contrast, the decline in consumption of printed media accelerated from -7% in 205 to -26% in. About the Internet: My husband is addicted to his smartphone, he is using it all the time. I tried to fight it for some time, but then I realizes that it was useless and got addicted to it myself. The only circumstance that may result in a reduction of the period of smartphone usage is going abroad or to the countryside where Wi-Fi services are chargeable or where there is no Internet connection at all. Focus group (aged 8 35) About television: I don t watch TV at all. Although we have two TV sets at home and Tricolor TV in the countryside, we don t watch TV. We get the information online using a laptop or a smartphone. Focus group (aged 36 55) Media consumption by category Russians as media users Media usage during the day Media consumption practices Changes in media consumption in 205 Despite the decline in the audience of video games, the respondents who continue to play them indicate that they do so more frequently (by 4%). At the same time, the usage index has decreased by 6 pp since 205. The media usage index is calculated as follows: [the proportion of those who indicated higher usage minus the proportion of those who indicated lower usage] 5

16 Media consumption in Russia Media consumption in Russia Highlights Internet E-books Printed books Television Internet has the highest media usage index (+59%) of all the media channels. Students are the most active Internet users with the media usage index of +70%. The lowest Internet usage index growth rates are seen in St. Petersburg (+5%). The usage index for e-books has reached 29% reflecting an increase in the time spent on e-reading. A more active consumption of e-books has been reported by the residents of Moscow (+45%) and other cities with a million+ population (+39%), people living in the Urals Federal District (+60%) and the North Caucasian Federal District (+49%). The usage index for e-books is also high among youngsters aged 6 9 (+37%) and people over 60 (+44%). The usage index for printed books is -2%. Printed books have seen the biggest decline among people living in the Siberian and Southern Federal Districts (-33% and -2%, respectively). At the same time, people aged 6 29 and respondents who live alone indicate spending more time on printed books (+2% and +24%, respectively). In, the usage index for television has increased from the previous year reaching -7%, but still shows a decline in the respondent s interest in this media. Television is very unpopular among youngsters aged 6 9 (-43%). A high usage index for television is only observed among the elderly (+7%). Printed media Media consumption by category Russians as media users Media usage during the day Media consumption practices Changes in media consumption in 205 The usage index for printed media is the lowest among all media channels (-26%). The strongest decline of printed media is seen among those living in the Siberian and Southern Federal Districts (-4% and -36%, respectively). 6

17 News sources Media source ranking by trust level Attitude towards the mass media: Russian or foreign source? The most popular content by media Frequency of Internet visits 7

18 Media consumption in Russia News sources Top 3 news sources Internet (news, analytics and official websites) 79% Television 67% Internet (social media and blogs) 30% Russians of all ages name the Internet (news, analytics and official websites) as the key source of information in. Television still ranks second for the majority of age categories. The importance of television as the key source of information tends to increase when moving from the youngest group of Russians (aged 6 24) (4%) to respondents over 45 (75 76%). The importance of news, analytics and official websites grows with the age of respondents (from 70% to 89%), while the importance of social media and blogs declines (from 57% to 7%). Change in the importance of news sources The importance of news and analytics websites as the key source of information for people over 65 has increased significantly (+6 pp vs the previous year). In the past year, social networks have become less important as a source of news among youngsters aged 6 9 (-3 pp) with a growing importance of news and analytics websites (+8 pp) Please select the two key sources you go to for news. 82 Internet (news, analytical and official websites) Aged Aged Internet (social media and blogs) 27 Aged An expert s view It s important for us to be part of the media space, get all the relevant news and remain up to speed on what is going on around us. Social media is the only place where you can see global news next to your friends or family s news. All the leading media from RIA Novosti and Channel One to Esquire and Cosmopolitan are on Odnoklassniki. Apart from traditional sources, there are now popular new media within social networks public groups, which are now adjusting to the new media consumption reality and offer news videos, significantly expanding their reach. As a result, a typical morning news routine has morphed into looking through social media feeds, consisting of videos, live streams, pictures and interactive content. Semen Boyarskiy, Director of Strategic Product Development, Odnoklassniki Printed media Radio Television Aged Aged Over News sources Media source ranking by trust level Attitude towards the mass media: Russian or foreign source? The most popular content by media Frequency of Internet visits 8

19 Media consumption in Russia Media source ranking by trust level If different media sources report on the same event differently, which source will you believe? Which media source do you trust most? Internet (news, analytics and official websites) Television Internet (social media and blogs) Face-to-face communication Radio Newspapers Magazines Trend News, analytics and official websites are the leading and the most trusted source of information in Russia. Their annual growth in trust is the highest in cities with a million+ population and in the Volga Federal District (+ pp). At the same time, television is trusted less by people living in cities with a million+ population and the Far Eastern Federal District (-5 pp and -2 pp, respectively). Falling trust in social networks and blogs is a strong trend in Russia now. Which media source do you trust most? I don t watch or read bloggers, as I don t trust them. I trust major periodicals on TV or in the Internet, as I believe their information is reliable. Television, definitely. I don t trust bloggers and try to neither watch nor listen to them that s the way people make their career. As for television, only competent journalists work there, who put on the air the reliable information only. Focus group (aged 8 35) Highlights A notably lower trust in television is seen in Moscow, the Far Eastern Federal District and among students (- pp, -9 pp and -6 pp vs the average, respectively). At the same time, the only age category with higher trust in television than in official websites are 65+ respondents (47% against 42%). Television is trusted more by people with secondary education (+ pp vs respondents with a bachelor s or master s degree) and unemployed people (+3 pp vs employed respondents). Residents of large cities show higher trust in news websites as compared to residents of smaller cities and towns (+5 8 pp). The highest trust in social networks is demonstrated by young people aged 6 24 with almost every fifth respondent trusting this source of information (9%). News sources Media source ranking by trust level Attitude towards the mass media: Russian or foreign source? The most popular content by media Frequency of Internet visits 9

20 Media consumption in Russia Attitude towards the mass media: Russian or foreign source? Is it important for you whether information comes from a foreign or a Russian source? Preference for Russian sources Preference for foreign sources It does not matter Trends in preferences for information sources in Average Television Radio Trend Two thirds of Russians (66%) indicate the importance of which source the information comes from. The majority (59%) prefers information from Russian sources. This is especially true for television news. Only 7% of respondents indicated a preference for foreign websites as a key source of information. When it comes to official, news and analytics websites the share is %. The respondents are most ambivalent about selecting magazines or listening to the public opinion: 39% of respondents do not have any preferences for whether this information comes from foreign or Russian sources. Highlights Higher loyalty to foreign sources of information is demonstrated by respondents from Moscow and St. Petersburg (+5 pp above the average) and students (+9 pp above the average). Respondents who live alone also have higher preference for foreign sources of information (+5 6 pp for various media channels). Foreign newspapers and magazines are more often read by respondents living in Moscow and St. Petersburg (+7 9 pp above the average). Moreover, residents of St. Petersburg listen to foreign radio more often than other respondents (+7 pp). Young people aged 6 29 pay no attention to the source of information more often (+8 pp). Russian television is more popular with pensioners (7%), unemployed people (7%), and people with secondary education (69%). News sources Media source ranking by trust level Attitude towards the mass media: Russian or foreign source? The most popular content by media Frequency of Internet visits Newspapers Magazines Internet (official websites) Internet (social media and blogs) Public opinion Preference for Russian sources Preference for foreign sources Does not matter 20

21 Media consumption in Russia The most popular content by media Which segments do you prefer? How often do you access them? How much time do you spend each day listening/watching/reading the segments you have specified? Television Movies TV series General news (daily news) 3.7 times 2.6 times 4.2 times Change from 207 Change from hr 2 min 2 hr 57 min 2 hr 0 min 2 min 3 min min News from any source of information (radio, television, printed media) are more popular with men and with older people. This is a general trend across the country in. About television: We watch television on the New Year s eve, as they show recordings of old and muchloved stage plays on the Kultura channel. Besides that there s nothing you can watch. News sources Radio Russian music Foreign music Information programmes (news, weather) Printed media 3.5 times 3.4 times 3.3 times hr 8 min 2 hr 6 min 2 34 min 2 3 min 3 min 2 min Students watch news on TV half as often as other categories of respondents. Moreover, young people aged 6 29 watch movies on TV less often than older categories of respondents. Moscow residents give preference for entertainment radio programmes more often. Russian music is more popular with residents of the Southern Federal District and with people with secondary education. Television fills a significant place in my life. I watch almost everything: news, sports events, TV series. This is an opportunity for me to see a slice of life. I navigate the Internet to find something that I saw on TV. Focus group (aged 36 55) Where do you primarily go for news? I am subscribed to political Telegram channels and get the information from there. It is quite practical. Media source ranking by trust level Attitude towards the mass media: Russian or foreign source? The most popular content by media Frequency of Internet visits General news (daily news) Popular science and education (travel, etc.) Political and social news 2.3 times.5 times.8 times min 2 32 min 2 29 min 2 0 min 2 min 3 min Russians aged give preference for foreign music with about 30 percent decline among people over 55. The highest interest in printed news media is demonstrated by residents of Moscow and St. Petersburg. I am subscribed to various information resources in Telegram and VKontakte. I primarily use Yandex to read news. Either VKontakte or popular videos on YouTube. Focus group (aged 8 35) Average frequency per week 2 Average time spent per day 2

22 Media consumption in Russia Frequency of Internet visits For what purpose do you use the Internet? How often? Percentage of users Change from 207 I search for information, including information I need for work, education or personal reasons 83% 0 pp I check for news on personal pages on social networking sites 69% 0 pp I use the Internet for informal communication (Skype, , blogs, fora, social networks) 67% 0 pp I use the Internet for business/formal communication (Skype, , blogs, fora, social networks) 65% 0 pp I read online news, newspapers, books, blogs and analytical magazines 59% 0 pp I watch movies and videos online 55% - pp I listen to the radio and music online 52% - pp I make purchases online 49% 0 pp No specific purpose 42% + pp I download movies and videos 4% -2 pp I download music 4% - pp I download books 37% 0 pp I only browse the web together with my friends/colleagues/acquaintances % 0 pp The Internet usage purposes remained unchanged from the previous year. Respondents have reported information and communication purposes as the main ones. People living in Moscow use the Internet for business communication purposes more often (+6 pp), while students and women use the Internet more frequently for informal communication (+5 and +2 pp, respectively). Moreover, Moscow residents use the Internet for online shopping more often (+8 pp). The lack of any specific purpose for using the Internet is less often reported by respondents who live alone (-6 pp below the average). News sources Media source ranking by trust level Attitude towards the mass media: Russian or foreign source? The most popular content by media Frequency of Internet visits What Internet applications do you use? Smartphone/tablet PC/laptop At the same time, students use the Internet for downloading movies, music and books more often (+ 5 pp above the average). Google Chrome Yandex Browser Google app Yandex app Google Chrome Yandex Browser Mozilla Firefox Opera In Russia the most popular browsers for both smartphones and PCs are Google Chrome and Yandex Browser. They are preferred by more than half of respondents. Opera/Opera Mini Android Browser 9 Internet Explorer/Edge 4 Safari 9 UC Browser 4 Samsung Internet 3 MIUI browser 2 22

23 Media consumption in Russia Please select three key Internet resources you access most often. Compared to the previous year, which of the Internet resources listed below do you access more or less often? Usage as a key resource Age category Change of activity visits Change in usage 6 24 years years years years years 65 and more VKontakte 70% 69% + pp 9% 86% 66% 60% 52% 44% 9% YouTube 62% 56% +6 pp 73% 62% 58% 60% 64% 60% 22% Odnoklassniki 42% 42% 0 pp 7% 3% 49% 48% 56% 56% -7% News websites 3% 40% -9 pp 3% 24% 33% 38% 37% 5% 7% Instagram 24% 7% +7 pp 6% 38% 7% 2% 8% % 5% Facebook 23% 27% -4 pp 8% 5% 23% 27% 35% 34% -% Online games 7% 3% -6 pp 6% 5% 8% 9% 7% 6% -5% Twitter 5% 6% - pp 3% 4% 4% 5% 7% 6% -2% Livejournal 3% 4% - pp % 2% 5% 3% 3% 3% -% Moi Krug 2% 3% -2 pp % % 2% % 2% 3% -5% Streaming services % 2% - pp 3% % 0% % 0% 0% -% Trend Social networks, news portals and photo/video hosting sites are mentioned among the most popular Internet resources. Respondents have mentioned YouTube and Instagram as the leading Internet resources in more often (+6 7 pp). At the same time, the popularity of news sites has declined (-9 pp), as some respondents prefer getting news by subscribing to other resources (for example, news portals on social networks). Online video games have become less popular (-6 pp) proving the general trend of reduced interest in video games among Russians. Highlights There are a number of interesting age-related trends for some Internet resources: VKontakte and Instagram are more popular among the youngest audience aged 6 24 with lower popularity among older people. With Facebook, Twitter and news websites it is completely the opposite. Livejournal is more popular among Russians aged 35 44, online video games among respondents aged Streaming services are most popular among young respondents aged The more active usage of YouTube video hosting (+22%) is reported by respondents, primarily, students (+35%). The respondents also report the increased usage 2 of VKontakte (+9%) and Instagram (+5%). Women (а 9 pp difference with men) and young people aged 6 29 (+9 pp above average) are using Instagram more actively. News sources Media source ranking by trust level Attitude towards the mass media: Russian or foreign source? The most popular content by media Frequency of Internet visits The Internet resource usage index is calculated using the formula: proportion of those who mentioned a resource in the top three resources 2 The Internet resource visit index is calculated using the formula: [proportion of those who began using a resource more often minus the proportion of those who began using a resource less often] 23

24 Attitudes towards new gadgets Russian household ownership of media devices Popularity of smartphone features Messengers Access to media by connection type 24

25 Media consumption in Russia Attitudes towards new gadgets Would you describe yourself as a gadget enthusiast? Please select what applies to you best. I prefer proven, well-established devices to new-fangled ones I do not purchase a new gadget until I have researched other new products to select the best I may be somewhat behind the first wave, but I prefer purchasing new gadgets before most others get them I will not buy a new device until it is a standard offer or there are other alternative options Trend The majority of Russians take a rational approach when buying a gadget, with 35% looking for proven devices and another 30% selecting a new product only after comparing it to other offers on the market to make sure it s the best. At the same time, there are only 5% of early adopters looking for the latest gadgets the moment they appear on the market. This figure is quite stable and has remained unchanged for four years. Another 4% prefer purchasing new gadgets before most others buy them. Highlights The largest share of early adopters is represented by respondents living in Moscow (+ pp above the average) and St. Petersburg (+6 pp above the average), and the young people aged (+6 pp above the average). Respondents who prefer purchasing new gadgets before most others buy them live, primarily, in Moscow and the North Caucasian Federal District (+9 pp and +5 pp, respectively). Elderly people, students and unemployed respondents are more conservative and prefer proven devices (+6 7 pp). Respondents over 60 prefer buying popular gadgets that have no reasonable alternatives (+9 pp). Attitudes towards new gadgets Russian household ownership of media devices Popularity of smartphone features Messengers Access to media by connection type I do not typically buy devices myself. It is usually a gift, a company-provided device or other I buy new gadgets as soon as they appear on the market. I like to be among the first

26 Media consumption in Russia Russian household ownership of media devices Do you own the devices listed below? If yes, please specify how you use them DVD, video recorder 65 Portable player (MP3, IPod, etc.) 42 Game console 30 E-book Audio system Annual change in the usage index Radio Tablet Car stereo Mobile phone Desktop PC Laptop, netbook Smartphone TV set Trend The top 3 common devices in Russian households remain unchanged: TV-sets (98%) still hold the leading position. The usage index has remained unchanged, reaching 89%; Smartphones (90%) have become more widespread over the last year (+3 pp). The usage index is at 87%; Laptops (8%) и PCs (80%) round out the top three. The usage index is at 7% and 69%, respectively. Mobile phones have seen a significant increase in the usage index (+ pp). About mobile phones: My mother prefers using her mobile phone rather than a smartphone that was given to her as a gift: she is steeling herself to switch to it. Focus group (aged 36 55) Highlights The oldest age groups (aged and over 65) have given the strongest boost to the popularity of mobile phones (+3 pp and +20 pp, respectively). In contrast, use of smartphones has risen the most among respondents aged 6 39 (+7 pp on the average). The tablet usage index is higher among people living in Moscow and St. Petersburg (+6 pp), while pensioners and unemployed respondents a less active tablet users (- pp and -5 pp, respectively). This year St. Petersburg has seen an increase in e-book usage (+5 pp above the average). Moscow residents and respondents aged are the most active console users (+9 pp above the average). Attitudes towards new gadgets Russian household ownership of media devices Popularity of smartphone features Messengers Access to media by connection type Yes No Usage index The usage index: [proportion of those who own and use a device minus proportion of those who own a device without using it] 26

27 Media consumption in Russia Which devices do you use to watch TV? How often? Television Laptop Desktop PC Smartphone Tablet 96% 63% 6% 6% 43% 5.3 days per week 2.7 days per week About television: I gave up television completely and now use TV-set to watch YouTube. 2.7 days per week I don t often watch TV, as I prefer watching certain programmes using a laptop, all-in-one PC or a tablet. I rarely use my phone to watch television. Local TV series I also look up on the Internet. Focus group (aged 8 35) 3. days per week.5 days per week Time per day Time per day Time per day Time per day Time per day 2 hr 3 min hr 32 min hr 33 min hr 34 min hr 5 min About the Internet: Over the past several years I have started using my smartphone more often: previously I preferred using a PC or a laptop, but now I mostly use my smartphone. I read news, watch movies and information programmes, use social media and messengers. This means that all the information now mostly goes through the phone. Focus group (aged 8 35) Which devices do you use to surf the Internet? How often do you use them? Smartphone Laptop Desktop PC Which devices do you usually use to listen to the radio? Tablet Television 86% 77% 73% 54% 47% 5.0 days per week 3.9 days per week 3.8 days per week 2. days per week 2. days per week Time per day Time per day Time per day Time per day Time per day 2 hr 39 min 2 hr 46 min 3 hr 0 min hr 34 min hr 58 min A car audio device A radio device at home A mobile device Desktop PC A portable device (IPod, etc.) 50% 32% 22% 9% 7% Attitudes towards new gadgets Russian household ownership of media devices Popularity of smartphone features Messengers Access to media by connection type 27

28 Media consumption in Russia Popularity of smartphone features Please specify which smartphone features you use more and less often. Messengers (WhatsАpp, Viber, Telegram) Mobile calls Internet calls (Skype, etc.) Social network apps Text messages Video games More frequent use Less frequent use Feature usage index Trend Messengers have outpaced mobile calls in : almost half of respondents have become more active messenger users with the feature usage index growing by 5 pp reaching +40% Internet calls are getting more popular (the feature usage index +9%) but still rank below mobile calls. The feature usage indices for text messages and video games are strongly declining (-39% and -35%, respectively). About messengers: My grandmother and grandfather are very active messenger users. We generally communicate using WhatsApp and Viber. Besides, there are situations when my grandma gives me a call to remind me of a birthday of some of my friends who she is subscribed to on Facebook. Focus group (aged 8 35) Highlights The popularity of mobile calls higher among men, while women are less active users of this smartphone feature (a 8 pp difference). While Moscow residents make mobile calls less frequently (-5 pp), they make Internet calls more active (+4 pp). At the same time, the popularity of mobile calls in St. Petersburg higher (+ pp). Students and women use smartphones to access social networks more often (+35 pp and +26 pp, respectively). Attitudes towards new gadgets Russian household ownership of media devices Popularity of smartphone features Messengers Access to media by connection type The feature usage index: [proportion of those who have indicated a more frequent use minus the proportion of those who have indicated a less frequent use] 28

29 Media consumption in Russia Messengers Which messengers do you have installed on your smartphone? Which ones do you use most often? Snapchat Yes No Hangouts Usage Annual change in the usage index Social network apps Telegram Skype Viber 57 WhatsАpp Trend Almost all of the smartphone owners (93%) reported the use of messengers. In Russia, WhatsApp (69%), Viber (57%) and Skype (45%) enjoy the highest popularity. However, this year less Russians have Skype on their smartphones (-7 pp), and its usage has declined by 5 pp. Leading positions are held by WhatsApp (58%) and Viber (38%). Their popularity increased by pp and 5 pp, respectively. The popularity of Telegram has grown this year: the share of respondents having this application on their smartphones has increased by 8 pp, and its usage has increased by 3 pp. Are there any changes in your use of Telegram? Me and all my friends have been using and are going to use Telegram further. Focus group (aged 8 35) Highlights People living in the Far Eastern Federal District and the North Caucasian Federal District prefer WhatsApp over Viber messenger (+65 pp and +48 pp, respectively). Attitudes towards new gadgets Russian household ownership of media devices Popularity of smartphone features Messengers Access to media by connection type 29

30 Media consumption in Russia Access to media by connection type Internet connection TV connection Radio connection Wireless Internet (Wi-Fi) Dedicated line (direct cable Internet connection) Mobile Internet (via smartphone, GSM-modem, LTE/4G) Modem connection ADSL connection Online TV: This is the most used type of connection in the Urals Federal District and the Far Eastern Federal District (47% and 48%, respectively). Individual cable antenna: This is the most used type of connection in the Volga Federal District (45%). General antenna: This is the most used type of connection in the Northwestern Federal District (45%) and the less popular type of connection in the Volga Federal District (7%). Satellite TV: This is the most used type of connection in the North Caucasian Federal District, and the less popular type of connection in the Urals Federal District and the Far Eastern Federal District (4% and %, respectively) Car audio device Household audio device Mobile device Internet (PC users) Portable player Attitudes towards new gadgets Russian household ownership of media devices Popularity of smartphone features Messengers Access to media by connection type

31 Attitudes towards advertising Advertising perceived loyalty and usefulness of advertising media Advertising usefulness by product category 3

32 Media consumption in Russia Advertising perceived loyalty and usefulness of advertising media What is your attitude towards various advertising media? Have you had a positive experience with advertising as a source of useful information? Outdoor advertising Advertising in printed media Sponsorship-based advertising Internet advertising Radio advertising TV advertising advertising Mobile advertising Cold calling Perceived loyalty Perceived usefulness Advertising: perceived loyalty Generally, Russians demonstrate positive sentiment for outdoor advertising, advertising in printed media and sponsorship-based advertising (positive advertising tolerance index). Internet, television and radio advertising are treated indifferently by Russian respondents (zero advertising tolerance index). Mobile and advertising are met with moderately disapproving sentiment (-% and -%, respectively) that turns into strongly negative when it comes to cold calling (-28%). Advertising: perceived usefulness As regards their perceived usefulness, Internet and TV advertising were rated the highest (26% and 7%, respectively). The low rate assigned to sponsorship-based advertising is explained by the fact that this type of advertising is aimed at creating a positive image for a company, rather than being a source of practical information for consumers. Russians consider cold calling as the least useful advertising method. Advertising perceived loyalty and usefulness of advertising media The advertising loyalty index The advertising usefulness index 2 About advertising: Crazy spam from online shops! I blacklist them immediately. I don t like it very much, because when I make a new order, I would have to search for an with the order details in the spam folder. Focus group (aged 8 35) About TV advertising: It seems like TV channels are flooded with similar advertising which gets on my nerves. Focus group (aged 8 35) A year ago or so commercial breaks have become very long-lasting on certain TV channels. My patience ran out and we had to say goodbye to each other. Focus group (aged 36 55) The difference in advertising tolerance and usefulness is a matter of perception by respondents: TV and Internet advertising are perceived as aggressive with positive usefulness indices and loyalty indices about zero. At the same time, sponsorship-based and radio advertising are treated with more tolerance, so that low usefulness does not result in lower tolerance. Advertising usefulness by product category The advertising loyalty index [proportion of those favoring advertising minus the proportion of those who disapprove] 2 The advertising usefulness is assessed based on the respondent experience with advertisements as a source of practical information [proportion of those who found useful information in advertisements minus the proportion of those who did not]. 32

33 Media consumption in Russia Perceived loyalty for various advertising media 4 What is your attitude towards various advertising media? Trend The overall tolerance index for major advertising media has grown (+2 pp) reaching 4%. Since 205, the advertising tolerance has been growing steadily, first of all, due to more positive attitude to outdoor advertising (+3 pp from 206) and TV advertising (+2 pp over four years). Tolerance to Internet advertising, which declined in , has recovered and has demonstrated the biggest growth in (+5 pp). Highlights The lowest advertising tolerance is demonstrated by men, Russians aged and over 55: with the average loyalty index at about zero. As seen on the chart, Russians over 40 on average demonstrate lower tolerance to TV and radio advertising. We have found strong correlation between the time spent watching TV and the attitude towards advertising: the more time respondents spend watching TV the lower is the advertising tolerance (correlation rate is -0.7). Advertising perceived loyalty and usefulness of advertising media Russia Men Women Aged 6 9 Outdoor advertising Aged Advertising in printed media Internet advertising Radio advertising Aged Aged Aged Aged Aged Aged Aged Aged Over 65 Dynamics of loyalty index, % The highest tolerance to outdoor advertising is demonstrated by people living in the Urals, Siberian, North Caucasian and Southern Federal Districts (+6 pp above the average). People living in the Central and Northwestern Federal Districts demonstrate a somewhat lower tolerance to outdoor advertising (by 8 pp) Dynamics Outdoor advertising 3 2 n/a +3 pp Advertising usefulness by product category TV advertising Printed advertising pp Average advertising loyalty index Average advertising tolerance level pp Internet advertising pp Radio advertising pp TV advertising pp The advertising loyalty index [proportion of those favoring advertising minus the proportion of those who disapprove] 33

34 Media consumption in Russia Perceived usefulness of advertising media Have you had a positive experience with advertising as a source of useful information? Trend In, the overall advertising usefulness has grown by pp reaching +2%. The perceived usefulness of Internet advertising has changed greatly over the year: while a year ago, over half of the respondents mentioned that Internet advertising delivers no useful information, in the usefulness index was at +26%. The usefulness of outdoor advertising and advertising in printed media has grown over the year (+5 pp both). Highlights TV advertising is considered more useful by people living in the Urals and North Caucasian Federal Districts (almost twice as high as the average) and people aged (+2 7 pp above the average). The usefulness of radio advertising is the lowest with pensioners and students (-8 pp and -3 pp below the average). Advertising perceived loyalty and usefulness of advertising media Dynamics of usefulness index, % Dynamics Advertising usefulness by product category Russia Men Women Aged 6 9 Outdoor advertising Aged Advertising in printed media TV advertising Aged Aged Aged Aged Aged Aged Aged Aged Over 65 Internet advertising pp TV advertising pp Average usefulness pp Outdoor advertising n/a +8 pp Printed advertising pp Radio advertising pp Radio advertising Internet advertising Average advertising usefulness index The advertising usefulness is assessed based on the respondent experience with advertisements as a source of practical information [proportion of those who found useful information in advertisements minus the proportion of those who did not]. 34

35 Media consumption in Russia Advertising usefulness by product category You have specified that you have positive experience with advertising as a source of useful information. Could you specify a product category for the product for which you found advertising information useful? Average Food Beverages Cosmetics and perfume Household chemicals Clothing Drugs Household appliances Electronics Cars Household goods Services Products for children Video games, movies, software TV advertising Radio advertising Advertising in printed media Outdoor advertising Internet advertising Trend Over the year the proportion of respondents who indicate that they get useful information from advertising about soft drinks decreased almost three times. At the same time, the proportion of respondents who mentioned that they get useful information from Internet ads about games, films and software significantly decreased. Positive experience with advertising I like when it s unclear what is advertised, when there s a mystery: you think of a certain product, but then it turns out to be another one. Focus group (aged 8 35) I like ads involving kids, families or nature, and humorous ads. I think that advertising is necessary. When an advanced product or innovative technology is introduced, it should be announced so that people could learn about it. In US and Europe advertising is not that annoying. Food and toy ads are always funny there. Advertising plots are soft and obtrusive. Our ads are always aggressive and disaffecting. Focus group (aged 36 55) Highlights Product categories where perceived usefulness is the highest: TV advertising: Food: 60% Drugs: 45% Household appliances: 44% Internet advertising: Clothing: 66% Electronics: 5% Cosmetics/perfumes: 48% Outdoor advertising: Food: 4% Household appliances: 3% Services: 30% Printed advertising: Services: 39% Food: 28% Cosmetics/perfumes: 27% Radio advertising: Services: 33% Advertising perceived loyalty and usefulness of advertising media Advertising usefulness by product category 35

36 Tolerance to Internet advertising Key reasons for blocking Internet ads Key reasons to reject Internet ad blocking Conduct-based approach to handling Internet ads Key factors to reject Internet ad blocking 36

37 Media consumption in Russia Tolerance to Internet advertising What is your attitude towards various Internet advertising media? News feed in social networks Static banners on websites Contextual advertising Native advertising Muted videobanners In-text advertising Commercials before videos Videobanners with sound Full-screen banners which can be closed immediately Pop-up banners Commercials interrupting videos Full-screen banners which cannot be closed immediately Perceived loyalty -6 An expert s view Advertising efficiency depends to a large degree on whether a user is concentrated on the medium through which an ad is being broadcast. A friend feed is one of the most popular services on Odnoklassniki and other social networks alike. That s why in-feed ads are so effective. Another factor is the possibility to show ads only to potentially interested users. Here the social media takes the lead due to its broad ad-targeting capabilities and interactive formats. For example, new performance marketing formats such as Lead Ads, that collect orders for a product or a service, simplify things for customers and significantly improve conversion rates. Instead of going to a company s website and filling an order form users may send their phone numbers or other data in just one click. Semen Boyarskiy, Director of Strategic Product Development, Odnoklassniki We asked our respondents to describe their attitude to the most annoying types of Internet advertising. Trend Advertising in the news feed in social networks, static banners and contextual advertising on websites are considered to be the most acceptable types of Internet advertising (loyalty index is at least -8%). Native advertising, muted video banners, in-text advertising and commercials before the video are treated neutrally by the respondents (loyalty index is at least -20%). Other types of advertising have loyalty index below -26% and may be considered as the most annoying, including: commercials interrupting a video (-29%), and full-screen banners which cannot be closed immediately (-33%). Highlights Youngest respondents aged 6 9 are more tolerant to native advertising, advertising in social media (loyalty index is at +6%), and contextual advertising (+3%). In contrast, people over 65 are less tolerant to native advertising and advertising in social media (- pp and -7 pp below the average, respectively). The respondents of this age category are also less tolerant to in-text advertising (-8 pp). About Internet advertising: Very obtrusive advertising. They start sending or offering something after every search request I make. It gets on my nerves and gives rise to a negative attitude towards advertising. You want to read something, but a banner covering two thirds of the page prevents you from doing this. You are always redirected to another pages if you miss clicking on the cross. It s ugly and fraudulent. Completely awful ads are shown prior to movies and cartoons. And there is no difference if it s a cartoon and a child may be watching it. Focus group (aged 36 55) Tolerance to Internet advertising Key reasons for blocking Internet ads Key reasons to reject Internet ad blocking Conduct-based approach to handling Internet ads Key factors to reject Internet ad blocking The advertising loyalty index: [proportion of those favoring advertising minus the proportion of those who disapprove] 37

38 Media consumption in Russia Do you use ad blockers (apps which block Internet advertising)? Which ad blockers do you use? PC/laptop users Smartphone/tablet users Average Men Women Aged 6 9 Aged Aged Aged Aged Aged Aged Aged Aged Aged Over Average Men Women Aged 6 9 Aged Aged Aged Aged Aged Aged Aged Aged Aged Over PC/laptop 2% Ad blocking software Total: Smartphone/tablet 7% Ad blocking software Total: 36% 7% 5% In-browser ad-blocking tools % In-browser ad-blocking tools Tolerance to Internet advertising Key reasons for blocking Internet ads Key reasons to reject Internet ad blocking Use an ad blocker Use browser adblocking functions Think of having an ad blocker Neither use nor plan to use an ad blocker Not aware of ad blocking apps Trend Although the overall perception of Internet advertising has returned to 205 figures, the most annoying and aggressive types of ads are forcing users to get protection against them. Thus, 36% of PC and laptop users block advertising online: 2% of respondents have a special app, and 5% of respondents use a browser s embedded functionality. Another 3% of respondents intend to start blocking ads on their devices. 7% of smartphone users block Internet advertising using: special apps (7%) and a browser s embedded functionality (%). The proportion of smartphone users who intend to start blocking advertising is much greater at 23%. Overall, two out of five Russians block Internet advertising (37%): 22% of respondents block ads on PCs only, 2% of respondents block ads on smartphones only and 3% of respondents block ads on both devices. Highlights Youngsters aged 6 9 are more active in blocking Internet advertising (57% on PCs and 3% on smartphones). At the same time, respondents over 65 are less active in using ad blockers (26% on PCs and 7% on smartphones). This is mainly due to the awareness of Internet ad blocking, which is twice as low in the second group. Conduct-based approach to handling Internet ads Key factors to reject Internet ad blocking 38

39 Media consumption in Russia Key reasons for blocking Internet ads What is the key reason for blocking Internet ads? Agressiveness of advertising Excessiveness of advertising Accelerate webpage load time Afraid of malware/infected software Reduce volume of uploaded data/save Internet traffic Intolerance to the fact that browser history is used for advertising purposes Offensive/unacceptable advertising content Extension of battery power PC/ laptop Smartphone/ tablet An expert s view There are two reasons why companies are still using annoying ad types. The first reason is that, technically, they work. If you persistently and annoyingly demonstrate a brand name to a person, they will not like it but they will memorize it and, most likely, without any negative associations. This way companies that can t or don t want to create exciting and high-quality content achieve their goals through frequent interactions with consumers. Secondly, the market lacks a variety of interesting marketing tools that would deliver a good reach. However, the digital market is developing and new, more native solutions are emerging (for example, in-photo format). Consumers are increasingly appreciating quality content, and advertisers are beginning to notice this. As a result, annoying ads are gradually driven out, and I believe in the next year or two their share will be falling. Nikita Ershov, Partner of 2.digital Agency Trend The key reasons that force Russians to use ad blockers are aggressiveness of advertising (70% for PCs and 66% for smartphones), and its excessiveness (59% for PCs and 45% for smartphones). There are a number of particular reasons that force Russians to use ad blockers on their mobile devices: reduction of the volume of uploaded data (to save Internet traffic), and extension of the battery power (+6 pp and +8 pp as compared to PCs). Highlights Fear of installing virus and malware is a much more common reason for using AdBlockers among women than among men: +6 pp for smartphones and PC. About Internet advertising: I don t like when I search or choose some products online and then get a lot of related advertising. Focus group (aged 8 35) About ad blockers: It s very convenient to use ad blockers on a PC. You can visit any webpage you like and see no advertising at all. Focus group (aged 8 35) I looked on YouTube to learn how to install an ad blocker correctly. I followed the recommendations and got rid of advertising on my laptop. I m very happy. Focus group (aged 36 55) Tolerance to Internet advertising Key reasons for blocking Internet ads Key reasons to reject Internet ad blocking Conduct-based approach to handling Internet ads Key factors to reject Internet ad blocking 39

40 Media consumption in Russia Key reasons to reject Internet ad blocking Why did you decide to reject Internet ad blocking? Tolerant to Internet advertising AdBlocker restricts access to information on website AdBlocker prevents websites from working correctly Don t know how to install AdBlocker PC/ laptop An expert s view As a creative digital agency, we see a growing use of ad blockers not as a barrier but as a challenge. Because of AdBlock, we and our partners, including clients and platforms, have to develop a more creative approach to digital marketing. We have to create better content and come up with native targeted projects, integrations and new formats. I think that in the long term AdBlock will be one of the reasons why advertising will become more interesting, and, possibly, more useful to the end user.» Nikita Ershov, Partner of 2.digital Agency Smartphone/ tablet Trend Ten percent of PC/laptop users, who know about ad blockers, and 8% of smartphone users neither use nor intend to use ad blockers. One third (29%) of PC and smartphone users, who deliberately reject ad blockers, say they are fine with Internet advertising. The key reasons to reject ad blocking include the following: potential restriction of access to the information on websites (29%) or incorrect operation of websites (23%). Tolerance to Internet advertising Key reasons for blocking Internet ads Key reasons to reject Internet ad blocking Conduct-based approach to handling Internet ads Key factors to reject Internet ad blocking 40

41 Media consumption in Russia Conduct-based approach to handling Internet ads What do you normally do if you cannot get access to the information on a webpage when your ad blocker is on? Temporarily turn ad blocker off or add the resource to the list of permitted websites Leave the webpage Buy a subscription to the Internet resource in order to avoid advertising (if possible) An expert s view Revenue in the online advertising industry directly depends on user experience. Ad blocking is something the professional community has to work with. We think it s important that people feel comfortable on the Internet and don t feel the need to protect themselves from advertising. That s why Yandex actively engages in development of domestic advertising standard as part of IAB Russia. Yandex browser automatically blocks shocking or aggressive ads that create negative user experience and make one want to install ad blockers which filter everything indiscriminately, even something useful. We are pleased that Deloitte s research revealed positive changes in user attitudes towards advertising. We believe this is partly because the market moved away from the most annoying ad formats. Research like this promotes transparency and helps the industry as a whole envision possible ways of aligning user satisfaction with business objectives. Dmitriy Timko, Product Team Leader, Yandex.Browser Trend Some Internet resources restrict access to the information on a webpage if a user s ad blocker is on. However, only 54% of Russians are ready to temporarily turn their ad blocker off or add the resource to the list of permitted websites. Almost half of the respondents (44%) would normally leave the resource if the information is not accessible leading to reduced Internet traffic for the webpage. Only 2% of Russians are ready to buy a subscription to the Internet resource in order to avoid advertising. Highlights Young people aged 6 24 turn their ad blocker off to read the information required more often than other groups (+6 8 pp). In contrast, respondents aged leave the webpage if the information is inaccessible most often (+ pp). About Internet advertising: Very aggressive advertising. You see new advertising every time you follow the link or type something. The information is often unreliable. I used to check it, so I don t pay much attention anymore. It infuriates me most of all when I see advertising banners after searching something in Yandex. Advertising gets on my nerves if a banner pops up unexpectedly when I read news online, especially if it can t be closed immediately. It s very inconvenient when using a phone. It seems like the Internet is flooded with advertising. Several years ago you could watch a movie online with no advertising right in the middle of it, but now you can be certain an ad would pop up suddenly. Focus group (aged 8 35) Tolerance to Internet advertising Key reasons for blocking Internet ads Key reasons to reject Internet ad blocking Conduct-based approach to handling Internet ads Key factors to reject Internet ad blocking 4

42 Media consumption in Russia Key factors to reject Internet ad blocking Would you continue using an ad blocker if it becomes a paid service? Almost two thirds of Russians (6%) are going to stop using ad blockers if they become a paid service. About paid Internet ad blockers: I would buy it as it s worth it. Focus group (aged 8 35) Average Men Women Aged 6 9 Aged Aged Aged Aged Aged Aged Aged Aged Continue using ad blocker Stop using ad blocker Which factors would force you to stop using Internet ad blockers? Minimized advertising on webpages Minimized annoying or aggressive types of advertising Restricted access to information on webpages for AdBlocker users Aged Over 65 Unemployed Employed This is particularly noticeable among young people aged 6 24 and unemployed respondents (+7 pp above the average). At the same time, 39% of respondents consider it acceptable to use a fee-based ad blocker and are ready to pay about 300 rubles. This allow us to estimate the user value of this service at this level. The main factor that would force Russians to stop using ad blockers is minimized advertising on webpages (44%) or minimized annoying or aggressive types of advertising (4%). Residents of St. Petersburg are most often not ready to stop using ad blockers under any circumstances (+7 pp above the average). I would like to have a free trial version first, and if it works correctly and blocks all ads, I would pay a maximum of rubles per month. Focus group (aged 36 55) About Internet advertising: It seems there is now less of those flickering banner ads. I m comfortable with contextual advertising as a reminder, if it s located at the bottom of the webpage leftwards and not right in front of your eyes. If it s less aggressive, more informative and smart, we would not seek to remove it and install ad blockers. We would possibly watch ads with pleasure if they weren t annoyingly popping up in every cartoon, movie or video. There is no denying it s affecting the kids too. Focus group (aged 36 55) Tolerance to Internet advertising Key reasons for blocking Internet ads Key reasons to reject Internet ad blocking Conduct-based approach to handling Internet ads Key factors to reject Internet ad blocking Will never stop using the AdBlocker Advertising-free information available at a reasonable price 5 42

43 Online purchase by product category benefits challenges 43

44 Media consumption in Russia Online purchase by product category What is your preferred way of making purchases? Video games, movies, software Electronics Household appliances Clothes Average Cosmetics and perfume Products for children Ready-to-eat food Household goods Drugs Household chemicals Food, incl. beverages Share of respondents who generally prefer making purchases online Share of respondents who give an equal preference to online and offline purchases Share of respondents who generally prefer making purchases offline Trend Digital products (video games, movies and software), household appliances, electronics and clothes are the most popular purchases with 4% and 37% of respondents preferring to purchase such products online. About online shopping: I would never buy food online, because I should see it with my own eyes and check the expiration date too. I would never buy perfume as I don t have trust at all. Focus group (aged 8 35) I buy almost everything online: food, toys, clothes and shoes for all my family, and household appliances. I have extensive experience in buying furniture, clothes, shoes, accessories, household appliances, etc. Internet is a key source of shopping. I even used the Internet to pay for my car, and I didn t get a chance to see it in real. Focus group (aged 36 55) Highlights The most active online shoppers are residents of Moscow and youngsters aged 6 9. People living in Moscow make online purchases of cosmetics and perfumes more often (+3 pp above the average), household appliances, household goods and products for children (+ pp above the average). Youngsters aged 6 9 buy food, household chemicals, clothes, drugs and electronics in the Internet more often (+7 2 pp above the average). Women purchase cosmetics/perfumes and clothes in the Internet more often (+7 pp and +4 pp above the average, respectively). Online purchase by product category benefits challenges 44

45 Media consumption in Russia benefits Which benefits of online shopping are the most important for you? Possibility to compare products and prices across various stores Possibility to read product information and reviews from external sources Lower prices Possibility of faster shopping 24/7 working hours Possibility of postponed purchases No visits to offline shops No queues Purchase of rare/unique products Payment on delivery Easy product search Purchase of goods from abroad Flexible discount/compensation/cashback system No customs duties Functional Internet advertising and click-through Trend There are four main benefits that Russians could gain when doing shopping online. First of all, online shoppers can compare products and prices and read product reviews submitted by other customers. Moreover, online shops provide lower prices and allow to complete a purchase faster than in an offline store. Easier way to make purchase due to advertising and lack of customs duties are not important criteria to make online purchases. Benefits of online shopping: What I like about online shopping is getting cashback from the bank. I don t have to go anywhere, waste my time and effort. I make my selection and the goods get delivered to me. I don t have to go shopping with kids anymore that used to be very wearisome, but now I only need my kid s attention for three minutes. Focus group (aged 36 55) Highlights The possibility to compare goods and prices is more important for people living in cities with a million+ population (+6 pp above the average). A 24/7 operation of online shops is an important criterion for people living in Moscow and the North Caucasian Federal District as well as the respondents aged The possibility to buy rare and unique goods is important for people living in St. Petersburg and the Far Eastern Federal District (+5 pp and +6 pp above the average, respectively), while lower prices is a more significant factor for respondents living in the Urals and Siberian Federal Districts (+7 pp above the average). Online purchase by product category benefits challenges 45

46 Media consumption in Russia challenges What challenges do you face when shopping online? Difficulties in assessing physical characteristics of products Non-conforming (size, quality) or non-authentic products Long delivery after ordering Complicated product return procedures Lack of trust in products purchased online (their quality and authenticity) Damaged goods or incomplete delivery Inconvenient location of pick-up points Having to register online Waiting for a courier Inability to collect goods at a pick-up point Inconvenient delivery times Having to pay a courier Bank cards not accepted Trend The majority of respondents (54%) indicate the inability to determine the real functional characteristics of a product as the top challenge when shopping online. This challenge is coupled with another one noncompliance with the declared functionality (non conforming size or quality). A long delivery after ordering as well as a complicated product return procedure are considered to be challenging by one third of the respondents. Disadvantages of online shopping: Prefabricated goods such as furniture should be checked. You should open the package and check the availability of all parts supplied. I have no idea how to do that online. Highlights A long waiting period worries people living in the Siberian, Far Eastern and North Caucasian Federal Districts the most (+5 pp above the average). Moscow residents are most reluctant to wait for a courier or to pay for his services (+7 pp and +6 pp above the average). Inconvenient location of customer pick up points and inability to collect goods there hampers the development of online shopping in St. Petersburg (+2 pp and +7 pp above the average). Online purchase by product category benefits A minimum order value is often established. To buy a product with a lesser value, you should order more to get free delivery. challenges You should always double check. If you let things slide, you often get into a scrape. This is true with any product and any online purchase. Focus group (aged 36 55) 46

47 Media consumption in figures Russian media consumption in figures 47

48 Media consumption in Russia Russian media consumption in figures Size of target audience Time spent on media Russians work day preferences 0% 93% 59% 44% 5,3 days per week Frequency media sources used 5,0 Change from pp + pp -4 pp -6 pp days per week 4,2 days per week,2 days per week On a work day 2 hr 32 min +7 min On a work day 3 hr 53 min -4 min On a work day hr 40 min + min Change from 207 Change from 207 Change from 207 On a weekend 3 hr 30 min +8 min On a weekend 4 hr min -8 min On a weekend hr 27 min +4 min What Russians cannot do without on a work day? 72% 22% 2% What would Russians rather do without on a work day? 33% 24% 24% Change from = 0 Overall perceived usefulness of media sources Work day Change from 207 Weekend On a work day 26 min - min Change from 207 Change from 207 Average On a weekend 3 min -3 min Change from 207 Russians weekend preferences What Russians cannot do without on a weekend? 63% 30% % Russian media consumption in figures Internet 49% + pp 38% +4 pp 43% +2 pp Radio 6% + pp 4% +3 pp 5% +2 pp What would Russians rather do without on a weekend? E-books 2% +4 pp 2% +3 pp 2% +4 pp 35% 25% 22% Printed books 2% +2 pp % - pp 2% + pp Printed media -% - pp -2% 0 pp -% 0 pp Television -% -5 pp -4% -2 pp -8% -9 pp Video games -22% -2 pp -7% -3 pp -9% -2 pp The media source usefulness index [the proportion of those who would like to continue using a media source minus the proportion of those who would like to stop using it for better daily productivity] 48

49 Media consumption in Russia Olga Tabakova Partner CIS TMT Industry Leader Deloitte CIS Anton Shulga Partner CIS Telecom Leader Deloitte CIS Authors: If you have any questions regarding this research, please contact us. Lora Zemlyanskaya Research Centre Leader Deloitte CIS Mikhail Gordeev Senior Research Specialist Deloitte CIS Ekaterina Lukianova TMT Industry Development Coordinator Deloitte CIS Yulia Afanasyeva Analyst Deloitte CIS 49