Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News

      The satellite broadband operators taking on Starlink

      9 July 2025

      Yaccarino out: Musk’s handpicked CEO quits X suddenly

      9 July 2025

      AI gold rush propels Nvidia to record $4-trillion market cap

      9 July 2025

      Price hike for .za domains

      9 July 2025

      China’s Temu ups ante with South African warehouse launch

      9 July 2025
    • World

      Cupertino vs Brussels: Apple challenges Big Tech crackdown

      7 July 2025

      Grammarly acquires e-mail start-up Superhuman

      1 July 2025

      Apple considers ditching its own AI in Siri overhaul

      1 July 2025

      Jony Ive’s first AI gadget could be … a pen

      30 June 2025

      Bumper orders for Xiaomi’s YU7 SUV heighten threat to Tesla

      27 June 2025
    • In-depth

      Siemens is battling Big Tech for AI supremacy in factories

      24 June 2025

      The algorithm will sing now: why musicians should be worried about AI

      20 June 2025

      Meta bets $72-billion on AI – and investors love it

      17 June 2025

      MultiChoice may unbundle SuperSport from DStv

      12 June 2025

      Grok promised bias-free chat. Then came the edits

      2 June 2025
    • TCS

      TCS | Connecting Saffas – Renier Lombard on The Lekker Network

      7 July 2025

      TechCentral Nexus S0E4: Takealot’s big Post Office jobs plan

      4 July 2025

      TCS | Tech, townships and tenacity: Spar’s plan to win with Spar2U

      3 July 2025

      TCS+ | First Distribution on the latest and greatest cloud technologies

      27 June 2025

      TCS+ | First Distribution on data governance in hybrid cloud environments

      27 June 2025
    • Opinion

      In defence of equity alternatives for BEE

      30 June 2025

      E-commerce in ICT distribution: enabler or disruptor?

      30 June 2025

      South Africa pioneered drone laws a decade ago – now it must catch up

      17 June 2025

      AI and the future of ICT distribution

      16 June 2025

      Singapore soared – why can’t we? Lessons South Africa refuses to learn

      13 June 2025
    • Company Hubs
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • AvertITD
      • Braintree
      • CallMiner
      • CambriLearn
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • Incredible Business
      • iONLINE
      • Iris Network Systems
      • LSD Open
      • NEC XON
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Tenable
      • Vertiv
      • Videri Digital
      • Wipro
      • Workday
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Fintech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Motoring
      • Public sector
      • Retail and e-commerce
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
    • Events
    • Advertise
    TechCentralTechCentral
    Home » In-depth » An old-world publisher embraces the brave new world of ‘free’

    An old-world publisher embraces the brave new world of ‘free’

    By Editor26 November 2009
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp

    Felix Erken

    When classified advertising specialist Junk Mail Publishing was founded in 1992, few people had heard of the Internet. Seventeen years later, the worldwide computer network has turned entire industries on its head, not least of them publishing.

    Junk Mail, which produces dead-tree products in Junk Mail, CapeAds, and AutoMart, among others, has been forced to completely change the way its does business — and embrace an uncertain future. It has had to embrace the “free” culture described so well by Chris Anderson in his controversial new book, Free: The Future of a Radical Price. Anderson reckons people under 30 won’t pay for information because they have come to expect it to be free.

    Junk Mail, like many traditional publishers, had long dominated its space. It had come to market with a radical idea of its own: it allowed people to place ads for free and get people to pay a premium for its magazines, knowing readers would be prepared to stump up cash to  have access to a vast catalogue of advertising.

    The concept worked and Junk Mail took off, taking market share from newspaper groups that continued to charge people to place ads.

    Business was good for a long time, and Junk Mail expanded its operations across the country.

    But trouble was looming on the horizon.

    By the mid-1990s, the Internet had started gaining traction. And in 1996, a San Franciscan, Craig Newmark, launched a then-small, free classified advertising website called craigslist. Today, Craigslist is the world’s biggest classifieds website, serving up more than 20bn Web pages a month. It’s among the top 10 most visited websites in the US.

    Craigslist makes money, but not very much of it. It costs nothing for the vast majority of people wanting to advertise on Newmark’s site. The only people who pay are real estate agents and those posting jobs ads.

    At Junk Mail, things were flying. The company had embraced the Internet early on — it launched a website in 1997 but put it behind a pay wall to protect its print business. It was working. “Everything we touched turned to gold,” says Junk Mail MD Felix Erken, pictured.

    But Junk Mail became too comfortable in its position. It was aware of Craigslist, sure, but because it dominated the SA classified advertising market so thoroughly, it felt it was immune.

    But it wasn’t.

    Craigslist rival Gumtree, an online classified service owned by US online auctions giant eBay, turned Junk Mail’s world upside down. Like Craigslist, just about everything on Gumtree is free — from placing ads to reading and responding to them.

    “Suddenly, Junk Mail, the king of classifieds, was under threat from guys who have never been to this country and probably never will come, with these monster websites that they have spreading out all over the English-speaking world,” Erken says.

    Gumtree, which employs powerful search-engine optimisation techniques to drive traffic to its website, established a significant presence in the Cape Town market.

    Junk Mail’s subscription-based model couldn’t compete. “We were having our lunch eaten by these guys,” he says. “It’s remarkable how destructive the Internet can be.”

    A radical rethink was urgently needed. So, earlier this year, Junk Mail threw caution to the wind and switched direction completely, tossing out its online subscription model and embracing the world of “free”.

    And guess what? It’s working. Well, kind of.

    “In the past eight months we’ve grown our online unique visitors by 500% and we have more ads placed with us now than we have had in the 17 years we’ve been in business.”

    All the ads placed online are also duplicated in print, so, ironically, the company is leveraging the Internet successfully to support its print product.

    There’s one catch, though. “We took a huge knock,” says Erken. “But we’re not worried about money for now, we’re worried about getting our market back.”

    For now, he says, it’s about saving the business from a tenacious rival.

    That meant changing the mindset of the company. “It’s not about protecting print anymore,” Erken says. “We are behaving like an online-only business. Print was a sacred cow for us. Now we’re eating T-bone steaks.

    “We will never think about print anymore when making a decision about online.”

    But how will Junk Mail make money in a world where everything is given away for free?

    “I don’t care about that right now,” declares Erken. “I just want to get market share.”

    Junk Mail has declared war on Gumtree. “They had an easy fight against us. No longer.”  — Duncan McLeod, TechCentral

    • Subscribe to our free daily newsletter
    • Follow us on Twitter


    Cape Ads Chris Anderson Craig Newmark eBay Felix Erken Gumtree Junk Mail
    Subscribe to TechCentral Subscribe to TechCentral
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous Article‘Rupert Murdoch is the modern-day King Canute’
    Next Article Solidarity cries foul over Telkom retrenchments

    Related Posts

    Gumtree jacks up security as syndicates target online platforms

    11 December 2023

    Ignition Group parent snaps up Gumtree

    22 July 2022

    Naspers’s Prosus on hunt for deals with $4.3-billion to hand

    23 November 2020
    Company News

    Samsung unfolds the future with thinnest, lightest Galaxy Z Fold yet

    9 July 2025

    Huawei supercharges South African SMEs with over 20 new eKit products

    9 July 2025

    Webtonic cracks the talent code with AWS-powered TonicHub

    9 July 2025
    Opinion

    In defence of equity alternatives for BEE

    30 June 2025

    E-commerce in ICT distribution: enabler or disruptor?

    30 June 2025

    South Africa pioneered drone laws a decade ago – now it must catch up

    17 June 2025

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    © 2009 - 2025 NewsCentral Media

    Type above and press Enter to search. Press Esc to cancel.