Businessmodel of Mail.ru

Customer Segments

Mail.Ru has a segmented market business model, with customer groups that have slightly different needs. The company targets its offerings at consumers and businesses.

Value Proposition

Mail.Ru offers two primary value propositions: accessibility and brand/status.

The company creates accessibility by providing a wide variety of options. It offers a broad range of Internet services, including e-mail, social networking, instant messaging, online games (social, mobile, and MMO), search, eCommerce, and cloud storage.

The company has established a strong brand due to its success. Its rankings include the following:

• It is the largest Internet company in Russia, with its services reaching 94% of Internet users in the country on a monthly basis and accounting for 33% of the time they spend online
• It owns the country’s top e-mail service and its largest Internet portal (Mail.Ru)
• Its e-mail service is the sixth largest worldwide in terms of monthly active users
• It operates two of the three largest Russian language online social networking sites (Odnoklassniki and Moi Mir)
• It operates the two largest instant messaging networks in Russia (Mail.Ru Agent and ICQ)
• It operates Russia’s largest online games platform Mail.Ru has more than 3,500 employes working out of 10 offices worldwide.

Channels

Mail.Ru’s main channel for consumers is its collection of websites, while its main channel for businesses is its direct sales team. The company promotes its offerings through its social media pages, advertising (online, TV, radio, and outdoor), and participation in conferences.

Customer Relationships

Mail.Ru’s customer relationship is primarily of a self-service, automated nature. Customers utilize its services through the main platform while having limited interaction with employees.

That said, there is a personal assistance component in the form of phone and e-mail support.

Key Activities

Mail.Ru’s business model entails designing, developing, and delivering its services and maintaining and updating its platform for customers.

Key Partners

Mail.Ru has the following key partners:

Startups – The company invests in these firms, focusing on those with online projects at the scaling stage that are targeted at the global market

App Developers – The company works with developers to help them develop their games, participating at various stages from concept to launch; specific services include design consulting, testing and debugging, gameplay testing, sound design, and music and text creation

Academic Institutions – The company works with colleges and universities to offer courses in fields such as programming and web development so that it can help build a technical workforce

Key Resources

Mail.Ru’s main resources are its human resources, who include the engineers that design and develop its services, the sales staff that promote them, and the customer service personnel that provide support.

A significant amount of its employees have strong product and technical backgrounds, enabling them to play a major role in product development efforts. Lastly, the company places a high priority on its intellectual property, with several patents and trademarks.

Cost Structure

Mail.Ru has a cost-driven structure, aiming to minimize expenses through significant automation and low-price value propositions. Its biggest cost driver is personnel expenses.

Other major drivers are in the areas of agent/partner fees, server hosting, office rent/maintenance, and marketing.

Revenue Streams

Mail.Ru has four revenue streams: online advertising services, MMO game sales, community value-added services, and “other” revenues.