THE SEARCH MARKETING REPORT

Commissioned by: ITWeb (PTY) Ltd t. + 27 11 807-3294 e. itnews@itweb.co.za e. sales@itweb.co.za http://www.itweb.co.za

Written by: Mandy de Waal t. + 27 12 667 2316 c. + 27 82 557 9190 e. mandyd@mweb.co.za http://www.mdw.typepad.com

THE SEARCH MARKETING REPORT
If you’re a technology marketer you should be online. Analysts say some 4.8 million South Africans are, and the big money’s going to search. Top analysts predict a boom in the local advertising market following the recent telecoms revolution and as infrastructure gearing for 2010 gets underway in earnest. As the advertising recession bites and marketers look for delivery and a strong return on investment Mandy de Waal, freelance journalist for ITWeb gives you the A-Z of search marketing. Everything you wanted to know about online advertising and search marketing from the industry’s leaders. A former broadcast journalist, Mandy de Waal spent twenty years in branding marketing before returning to her first love, journalism. She writes for a number of titles including ITWeb. Read Artificial Intelligence, her blog on new media, current affairs and business at: http://mdw.typepad.com/.

IN THIS REPORT:
The big money’s going to search The local online landscape South Africa snoozes What is search marketing? What marketers should know Hiring and managing specialists Hiring and managing specialists Charl Norman, the rising netrepreneur Rafiq Phillips, the Web AddiCT Resource guide
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Commissioned by: ITWeb (PTY) Ltd t. + 27 11 807-3294 e. itnews@itweb.co.za e. sales@itweb.co.za http://www.itweb.co.za 2

Written by: Mandy de Waal t. + 27 12 667 2316 c. + 27 82 557 9190 e. mandyd@mweb.co.za http://www.mdw.typepad.com

Search marketing is big money
Because it delivers ROI in a recessionary market
85% of marketers are using, piloting, or planning to pilot search marketing programs this year. A survey of 275 interactive and business-to-business marketers in Asia Pacific, Europe and North America by research company Forrester, shows that marketers in those regions love search. Simply because if done well, it delivers to the bottom line. Then in the US while economic uncertainties have put pressure on the ad market, online ad spending continues to buck the trend. JupiterResearch forecasts that online advertising will grow just less than 20 percent in 2008 to $23.8 billion, saying that as advertisers continue to seek increased accountability and return on investment (ROI), spending will additionally grow at a 13 percent compound annual growth rate (CAGR) to $43.4 billion in 2013. This in comparison to off-line ad spending that will increase at a mere four percent. When the market snaps back consumer adoption of the internet will drive this trend harder. Paid search will get the lion’s share of online ad-

Earlier this month General Motors’ media services unit announced a rationalisation to focus on digital talents and tools, with Ad Age reporting that it would spend $1.5bn of its $3 billion advertising budget online. General Motors is the biggest auto advertiser in the United States, and the move is telling. It’s in line with the US motoring industry trends, reported on by TNS Media Intelligence, which sees car brands spend more on internet advertising, while decreasing their spend on television, print, and in newspapers. Billboard and radio spend remains the same.
SOURCE: TNS Media Intelligence

Of all online advertising tactics, search is proving to be the crown prince of interactive marketing. That’s because the internet’s time has come and new media is dramatically shaping consumer behaviour. How do you buy a car, a house, or a new financial product? You do your research online. What if you’re going on holiday? The disintermediation of travel agents clearly shows that people are researching, booking and paying for holidays on line. There was a time when you’d phone your local travel agency when you wanted to book an airline ticket, now it appears laughable to even think of doing this. 3

Another big reason for the increased spend in interactive marketing is generational. Early technology adopters, younger generations are spending more and more time on connected devices.

SOURCE : Forrester

Now let’s look at South Africa. Wonder why the information given here is not SA centric? That’s because there’s little if any current and relevant information on the local online advertising industry. The last report appears to have been done by WorldWideWorx in April 2006. At the time Arthur Goldstuck, MD of World Wide Worx, indicated that the advertising industry had not yet woken up to the potential of online advertising, and that traditional industry had yet to become aware of the efficiency, measurability and reach of online advertising. Now here’s a challenge. Come on. I dare you. Phone up five marketing directors or brand managers and ask them if they know what search marketing is. What paid search is. What organic search is. Why they need to optimise their site if they do a search campaign. Chances are you’ll draw a complete blank. Why?

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The local online landscape
Get ready for the boom
Some 10% of South Africa’s population is connected to the internet according to leading ICT analyst Lindsey McDonald of Frost & Sullivan. “We’re looking at some 4.8 million connected people, which includes business and university,” says McDonald. World Wide Worx estimates that this figure is slightly lower. "At the end of 2007, 3,95-million South Africans had access to the Internet, expected to grow by around 10% in 2008. Of these, around 4% are accessing the Internet only on their mobile phones." Geographically the Western Cape has the one of the strongest online digital media sector offerings in South Africa, with a big concentration of talent, but unfortunately says McDonald a lot of talent goes offshore once they’ve tapped into international markets. “The main markets are of course the US and UK, and what we’re finding is that South Africa is becoming a main service and talent provider to those markets, rather than to the domestic market.” In terms of usage search is by far the leading activity. “After that people use the internet for research, email, news and banking. In this respect we’re very similar to other countries. However online shopping here is still small by comparison.” McDonald says the online advertising market is small but will flourish as connectivity booms and marketers embrace technology and the demand for accountability, reporting and a return on investments. Change in advertising spend from 2002 to 2006: 2002 2006
Newspapers Radio Cinema Outdoor Magazines Television Internet 27% 12.5% 0.7% 3.7% 12.5% 43.2% 0.4% 26.6% 12% 1.2% 3.6% 10.3% 45.2% 0.7%

*Source : Lindsey McDonald quoting SAARF Although the volume looks small, revenue on online advertising is climbing. Spend went up from R5m in 2002, to R20m in 2006 and will continue to grow. What is hampering spend however is the inability to provide audited ratings. “Online media is a new media and has come a long way, but still isn’t at the point where it is audited like television and radio,” says McDonald. “Then there is this perception that advertising spend has gone from print to online, which is incorrect. Outdoor has become significant and we’ve seen good growth there. Then South Africa is an innovative market so we will see spend in new places. However expect a boom in online advertising in four to five years when the undersea cables have come and our national connectivity is up to standard.” What’s sure is that while connectivity has been constrained by Telkom’s telecoms monopoly, policy reform means that ISPs no longer have to use Telkom's networks. The liberalisation of the sector, entry of Neotel and deal talking in this sector is good news for the expansion of infrastructure, pricing and accessibility. The infrastructure gearing for 2010 and the laying of three more undersea cables means that internet access will eventually become cheaper and more ubiquitous. Another factor to consider is Generation Y who are using mobile, internet and gaming devices more than radio or television. This trend will continue as connectivity becomes more ubiquitous and newer generations move into the market as Web natives. The bottom line is that the brands that have pioneered the market will have massive learning and experience and will benefit significantly from the boom.

In short. You snooze. You loose.
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South Africa – you snooze, you loose
A few pioneers, mostly late adopters and laggards
Although South African marketers know about online advertising, few understand how to effectively manage or integrate online into existing campaigns or strategies. Fewer appreciate search marketing or understand how powerful it is as a direct sales or acquisition vehicle. Done well, search marketing can drive customer acquisition, contribute towards sales growth and build the bottom line. Despite the success of search internationally, the biggest job agencies have locally to do is to educate the market and weed out the cowboys. “In the UK our clients know they need search, and there our job is to convince that we’re the best agency for the job, in SA, we still need to convince them to use search” says Rob Stokes, CEO of Quirk eMarketing. “Local marketers are very cautious adopters of technology. In the UK search is more than half of our business but here it remains less than a quarter.” Says Christine da Silva, Chief Search Officer, of AlterSage Online Marketing: “The local search environment still has big room for growth, and there are many industries that could use the medium to much better advantage. That’s if they are using it at all. The travel, tourism and related markets spend the most on search marketing. If one looks at marketing budgets in general marketers are still choosing traditional media above search. A curious few are using multi-channel marketing (a combination of traditional and digital media), while the minority are tipping the scales and leveraging more digital than traditional.” Then like the good old dot.com days there are those who are muddying the water. Search is a highly complex and specialised marketing and not everyone who claims to be a search expert is one. “Search marketing is very new in the marketers mind,” says Peter Stewart, Managing Director of Clickthinking. “People in the industry use it to find information, but it is very new locally in terms of being a marketing platform. Ignorance is bliss, and there are a number of suppliers who don’t provide sound returns. The key for marketers is to respect that search is a big opportunity for their business. Don’t skimp when you are assessing providers. Go back to the traditional approach where you look at track records. Do the proper due diligence and understand at the very least how to manage a specialist agency and what they should be giving you.”

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What is search marketing?
The short hand to what marketers should know
You need to think of search marketing as a three step process. The first step is acquiring or recruiting or harvesting online users. However you look at it this is all about getting people to go to your site or service or online vehicle. There are two ways of doing this namely through organic search or through paid search.  Organic or natural search: This is where you rank in search relative to the terms germane to your business. This is based on your ability to understand how Google builds content (because Google dominates online search). If you do you will be able to appear prominently on their site. This is not as easy as it sounds. Paid search: These are the paid for advertise on Google (or the lesser known and used search sites.) Type in “insurance” on Google and you’ll see the paid searches below and to the right of the result.

ONE:



The second step is ensuring your site is geared for search. This is called Search Engine Optimisation, or SEO. The way you build a web site and the technology you use relates directly to how it will feature in search engine rankings. SEO is all about web content and making it easy for search engines to index, find and display your content.

TWO:

THREE:

The third step is making sure that when you have a stream of traffic directed at your site they don’t drop off. An analogy would be taking a funnel and using it to pour coins into a copy next to a drain. Then shift the funnel so that the coins now fall into the drain. To maximise search results you need to understand how people enter and exit your site, and why they do. Then how to get people to do what you need them to do on your site (buy, sign up for newsletters, or whatever else your marketing objective is.) The smarter you get at this the better you’ll The experts agree that the best search campaign use a hybrid of paid and natural search. They also agree that if you are going to invest in search marketing you must optimize your site even if this means rebuilding it, or else you’re simply not maximizing your investment. Or may even be pouring the money invested in search marketing down the drain.

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What marketers should know
The inside track on key search marketing issues
“Search is all about deliverables. It is a medium that matches what people are looking for with solutions marketers are able to provide. Understand your online objectives and how these relate to your overall business objectives. Then ensure that the appropriate tools are in place to monitor and optimise these, ensuring that your search campaign delivers the most valuable traffic to your site for your particular requirements,” says Di Charton, Acceleration Media. “Implement pay per click advertising and organic search campaigns simultaneously. It is key to rank for your brand and its products in organic search and also in the paid search listings. Having paid ad presence for brands along with natural search ranking enhances your overall click through rates and gets the visitors to your pages and not your competitors.” – Rob Stokes, Quirk eMarketing “Do your homework. When you hire an agency to manage search marketing go with a specialist supplier who can show organic results in search (high visibility that is quantifiable), as well as paid results. Ensure the supplier has a track in a variety of industries and categories where they have prominently placed clients top with qualified phrases. Understand that when you drive traffic to your site you must take responsibility for converting that traffic. Make sure you are able to convert traffic that comes to your site.” Peter Stewart, Clickthinking “Search marketing is one weapon in your arsenal, it's not the whole battle plan. Your campaign should always start from an objectives point of view. Know what your website is trying to do first, and then let those objectives define your search campaign objectives.” Darren Ravens, Editor of MyWeek Online.

“Know how to monitor the tools your search professional uses to optimize and drive traffic to your site so you can pull your own ROI reports.” Charl Norman, Co-Founder and Operations Manager, Blueworld Communities.
“Search engines are the first place people are looking to find information on any brand. Compared to traditional media it is more cost effective and results are measurable as well as sustainable. Cost of Sale and penetration are easily calculated.” Christine da Silva, AlterSage Online Marketing “One of the core issues is competition in the internet marketing space. More competition pushes the cost to get a visitor on your website higher. If your website can’t convert the visitors into leads and customer you’re going to loose money.” Ferdie Bester, Founder and Managing Director of ClickMaven.

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Hiring & managing search specialists
The expert guide on how to find the best of the best
How to hire by Quirk eMarketing:
There are many small agencies and one-man bands touting Search Engine Marketing (SEM) services. Most of them are not very effective and could end up costing clients significant portions of their marketing budget, without generating real results. Quirk recommends that companies choose their digital marketing partners carefully. Clients should look at factors which suggest that the company is not just a recent player but has deep web and digital marketing understanding (both theoretically and practically). SEM is inherently tied together with all other online marketing tactics so an agency that understands and is capable of delivering on the big picture is more likely to be successful. Good SEM (organic and inorganic) can take months to start generating serious results – so any SEM service provider that promises “instant” results should be viewed with due circumspection. Your search marketing specialist should:  Demonstrate ongoing experience in the relevant areas, for instance paid search, SEO and social media;  Have a strong capacity to deliver;  An ongoing and long term understanding of the web marketing space;  A realistic understanding of the social media trends, how this is evolving in South Africa and how it must interface with SEM to allow commercial return on investment;  Good “name brand” clients who are happy and have seen consistent SEM results over an extended period of time. Don’t look on the search engines as surprisingly many reputable agencies don’t have great ratings. If they have time they to ensure the highest rankings for themselves they can’t be all that busy. Furthermore, blue chip clients are generally landed via word of mouth and the smaller SEM clients come via search engines. Make sure the search specialists are talking about business goals and not rankings. Clients shouldn’t care about rankings but conversion and how the specialist can achieve the brand’s business goals. Your goals will influence what specialists rank for. You want an agency that gets the big picture.

How to manage : Christine da Silva, AlterSage:

Have predetermined goals in mind and ask the specialist how they would achieve these goals. Define your target audience and competitors to ensure that they are creating a strategy as unique as your website. When it comes to results and campaign reporting, remember that results depend on a few factors. These are content, website structure and of course the strategy involved. Some clients might see really great results within three months, others eight months. It takes about 12 - 18 months for a search campaign to mature, so the bottom line is that you should not give up on search before the 18 months are over.

Who to hire : Peter Stewart, Clickthinking:
Traditional agencies have been slow with regard to adopting the web as a business channel for their clients. They don’t understand the Web as a specialist channel. Generally speaking digital budgets are last on their list, and seen as an extension of the bigger campaign in South Africa. Often, traditional agencies hold the strategic relationship with the bigger corporates, but have struggled to understand the digital space, although this has changed marginally in the last two years as they have been forced into some digital role by clients. Clients now understand that the Web is a sales or acquisition tool. That it is so quantifiable. My advice is that if you want the best results you’d better speak to specialists with a good track record who can deliver on the complexity demanded by search marketing and the conversion process that follows. 9

Who to hire : Ferdie Bester, ClickMaven:
“Look for an agency who will spend the time to listen to your business concerns and objectives. The proposed campaign should then be build around these objectives. Check references. Ask the agency how you can manage and measure its performance. If it sounds to good to be true it usually is.”

How to manage: Charl Norman, Blueworld Communities:
Know how to monitor the tools your search professional uses to optimize and drive traffic to your site so you can pull your own ROI reports. Think beyond Google, and ensure your search specialist does to. Don’t only focus on Google but utilize all the search engines like Ask, Yahoo!, Live search and social media engines like Digg, StumbleUpon and Delicious. There’s lots of traffic to go around.

How to manage: Di Charton, Acceleration Media:

Ensure you develop a partnership approach with your search professional. Business evolves and objectives change and you need to ensure you have an open relationship that allows your campaign to grow and develop as your business does. Understand the value your campaign delivers and then ensure you test and explore. In this way, you’ll ensure you grow with your audience.

Out-source or in-source: Darren Ravens, Editor of MyWeek Online:

“Local brands need to take control of their own search space. By that I mean the search phrases that relate strongly to their brand and their core business. They need to realise the reputation value of search results, above and beyond the lead generation value. They need to realise that people out there are searching – they'll either find you or they'll find someone else. There are definite advantages to developing in-house search marketing skills. It really depends on the specific situation and the nature of the business. If a big part of your business is web-centric, if you have other web specialists in house, then in house is probably the way to go. As traditional marketing begins to merge with search marketing, it starts making more sense to develop skills inhouse. In other situations it might make more sense to outsource – it's pretty much like any other outsourcing decision. It's a decision that needs to be considered on a case by case basis. A good mix is to outsource initially but outsource with the view to getting a transfer of skills.” 10

Search marketing trends
What’s hot and where search is going
“Everyone is talking about mobile and looking at ways of accessing the high number of people utilizing these devices. Search offers a very measurable means of ensuring traffic of a high relevancy and, on a local level, we are seeing a high degree of interest in this segment. The mobile platform offers an opportunity to expand your offering to a new and growing demographic.” Di Charton, Acceleration Media “Globally most search advertising spend and optimization is done on Google. So looking at the Google’s hot trends you will see a long tail keyword trend dominating the top 50 search terms.” Also up to 40% of those search queries are refined to find better results, this proves there is a lot of room for search to improve” says Charl Norman, Co-Founder and Operations Manager, Blueworld Communities. “Google SA opened an office in South Africa a few months ago so expect a big push for their PPC product called AdWords. Mobile marketing is also going to be massive with the middle to lower market becoming reachable. This is where the future consumer growth in South Africa will come from (LSM 3-6). Google launched Mobile search a while ago and it looks very promising.” Ferdie Bester, Founder and Managing Director of ClickMaven “In 2007 40 percent of visitors to Web sites used to land on the home page. In 2008 this decreased to 25 percent. What you are finding now is that users go straight to the page with the product information they want. Search from a behavioural perspective is changing the way people find things. When you build your website you need to understand this. You need to ensure that deeper level pages with product or information require someone to act. They must perform as much of a function as your entry pages.” Peter Stewart, Clickthinking. “The biggest trend is that search marketing is going mainstream. The very fact that you're writing this article proves my point. With increased uptake of course comes increased competition. Another trend is the rise of online reputation management. It's not just about search engine results pages and rankings anymore. it's also about the narrative that search results carry.” Darren Ravens, Editor of MyWeek Online. “Usage data is a key trend. Google is building usage data into their algorithm so this means your ranking will be affected by how users interact with your site. Because of this you will have to ensure your site is engaging. A web site that attracts, retains and converts visitors organically will fair better. Ensure your site is fresh and offers targeted and perceived value.” Rob Stokes, Quirk eMarketing. “Search Marketing is a solid foundation to any online marketing campaign. Trends come and go, but all are inevitably linked back to search engines, as it is the first port of call to find anything – even social media interaction! However, no matter how good your search campaign, ultimately your web presence needs to convert.” Christine da Silva, AlterSage Online Marketing 11

FACE TO FACE Charl Norman
Co-Founder Operations Manager Blueworld Communities
Small wonder Charl Norman’s been nominated for the 2008 African ICT Achievers Awards. He is co founder of Blue World Communities, which includes some of South Africa's fastest growing and most interesting social network portals – including BlueWorld.co.za and ZoopedUp.com. Blue World Communities has been in the news recently as they've just been snapped up by Naspers’s 24.com. Like Buffet they invested in the talent rather than the company. A decision that appears to be paying dividends as the site is expected to be second only to Facebook in South African social media usage by October 2008. A contributing factor to the social network’s success is Norman’s sassy search marketing skills. Charl is 23 years old, and is gaining a steady reputation as an engaging public speaker. Charl has been featured as a guest lecturer on the UCT Graduate School of Business Nomadic Marketing Course; and is also the author of two highly successful blogs, Carblog.co.za and Bandwidthblog.com. Do South African marketers understand new media as a marketing tool? Each year online ad spend in South Africa grows as brand managers gain more trust in new media. But we’re still behind markets like the US and Europe, and are not yet using new media advertising to its full potential. This will come with time as more brands spend portions of their ad budget online and as mobile advertising matures into a profitable industry. Brands that realise they need to interact with the youth demographic on social networks like Facebook to engage with future buyers will also lead the way. What challenges have you faced? There are a few challenging factors facing web entrepreneurs in South Africa such as low broadband penetration, expensive local hosting and a lack of commitment from advertisers. With the small internet audience in South Africa and relatively few advertisers to monetize that audience, doing business online is quite challenging. With little venture capital interest in South Africa, the costs of engineering, talent and infrastructure sky rocket when start scaling your product. Who's your guru? Some of the guys I admire are Vincent Maher, Mark Shuttleworth, Ronnie Apteker, Rob Stokes and internationally – Michael Arrington, Kevin Rose, Ev Williams, Mark Zuckerberg and Jason Calacanis. What tools and applications are hot right now and why? I’m really enjoying some of the Adobe Air platform applications such as the Google Analytics suite and Twhirl. I use Twhirl to write micro blogs and share links on twitter and the analytics suit to watch my stats and pick up on user trends within our communities. What's the best advice anyone ever gave you? If opportunity doesn’t knock, build a door. What's your dream or vision for the local new media industry? For advertisers to spend a larger portion of their budget online and engage with online audiences. The advertising spend curve in South Africa is dominated by the big publishing houses like 24.com, IOL and Avusa. Spreading the ad spend out to smaller publishers will help grow the industry. 12

FACE TO FACE
Rafiq Phillips Web AddiCT
Legend has it that Rafiq Phillips was born online. A self-styled search engine marketing guru, Rafiq has been in the internet industry almost since it existed in South Africa. Known to his friends as Rafiki the Web AddiCT cannot survive daily life without muti.co.za, Wikipedia, TED.com and an arsenal of Google products. When asked about his notable work characteristics (both good and bad) he replies, "Slow to finish and quick to start". Where do you come from? I've always had an interest in technology (joined the computer club in primary school) and when my peers were playing computer games I'd be wondering how and why the computers and games worked the way they did. When I first got connected to the internet via dial-up at home when I was at high school, my hobby used to be learning about the inner workings different web technologies and what made the internet work. I ended up building websites for friends and family and started connecting with like-minded individuals on Internet Relay Chat (IRC). Sleep and my school grades suffered because I was staying up during Telkom's call more time and dosing off in class for most of grade 11 and Matric. I ended up studying software development at Cape Tech/CPUT but didn't finish. In 2005 I wrote a business plan and entered it into the National Innovation Competition instead of writing my final exam. The R50000 prize money I won with my business partner, Miguel dos Santos, allowed us to further develop www.idrive.co.za, which was what the business plan was about. What are your dreams, hopes, ambitions? I dream of developing a sustainable business that not only creates wealth but instigates positive social change within the community which it serves on a local or global scale. What have been the most important things you've learned along the way? Impossible is nothing, with the help of like-minded peers (and Google). Also, do not trust your employer’s word. Get it in writing. What challenges have you overcome? At the end of my first year of tertiary education I survived a car accident where I lost two close friends, most of my memory of my first year and my short term memory. I had to learn to walk, write, and remember all over again. Who's your guru? In South Africa Mark Shuttleworth: for his work in open source (Ubuntu) and community development projects with the Shuttleworth Foundation and Tuxlabs. I volunteered with Tuxlabs on weekends for 2 years. Then Rob Stokes the CEO of Quirk eMarketing who is always willing to share insight and give advice. And for his ability to attract top talent and allow them to work in an environment second to none. Internationally, Larry Page and Jimmy Wales (both whom I’ve met personally) for their work on Google and Wikipedia. What advice would you have to others who want to get into the game? This is real life, not a game, start already. Read, learn, contribute, share your ideas and do not fear rejection. It's never too early. Do not wait until you believe you have gained enough experience, it will be too late by then. How do you grow? Learn. Evolve. Get better at what you do? Reading, Testing, Sharing 13

SEARCH MARKETING RESOURCES
ANALYSTS & RESEARCH Lindsey McDonald, ICT analyst, Frost & Sullivan Forrester Jupiter Research South African Advertising Research Foundation WorldWideWorx AGENCIES Christine da Silva, Chief Search Officer, of AlterSage Online Marketing Di Charton, Managing Director of Acceleration Media Ferdie Bester, Founder and Managing Director of ClickMaven Peter Stewart, Managing Director of Clickthinking Rob Stokes, CEO of Quirk eMarketing WEB NATIVES Charl Norman, Co-Founder and Operations Manager, Blueworld Communities Darren Ravens, Editor of MyWeek Online ORGANISATIONS Online Publishers Association Members of the OPA ABOUT ITWeb: In less than 10 years, ITWeb has grown from a small online pioneer to a technology-focused publishing house that dominates its sector. Along the way it survived the dotcom boom and bust, multiple waves of scepticism around the viability of online media, and numerous competitors and pretenders to the throne. As the technology industry has matured, so has the company. It is a stable, profitable media house with a long and growing list of happy advertisers. Today ITWeb publishes three titles, a series of annual publications and owns related businesses within its chosen space. It is the most trusted voice in local technology publishing and the first port of call for an audience that ranges from technology professionals to CEOs. ABOUT Mandy de Waal: A former broadcast journalist Mandy de Waal spent twenty years in branding marketing before returning to her first love, writing. An investigative journalist and columnist, Mandy de Waal writes for ITWeb, Brainstorm, MoneyWeb, Brand Magazine and a number of other media. Read Artificial Intelligence, her blog on new media, current affairs, politices and business at: http://mdw.typepad.com/. Copyright (c) 1996 - 2008 ITWeb Limited and Mandy de Waal. Graphs with kind permission from Forrester, Jupiter Research and TNS Media Intelligence. This report may not be reproduced without the permission of the editors, and is an editorial product that is not for sale.

Commissioned by: ITWeb (PTY) Ltd t. + 27 11 807-3294 e. itnews@itweb.co.za e. sales@itweb.co.za http://www.itweb.co.za 14

Written by: Mandy de Waal t. + 27 12 667 2316 c. + 27 82 557 9190 e. mandyd@mweb.co.za http://www.mdw.typepad.com