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By Maya Sioufi March 2012

Lebanese firm opens doors to a new world of advertising
To say that Internet and social media usage in the Middle East and North Africa is expanding exponentially has become a truism of our time, but like the dinosaurs that failed to adapt as the ice age covered the globe, many companies' marketing strategies now resemble bewildered cave men soon to be run over on the information highway.

So how fast is the online world changing? Well, the number of Internet users in the Middle East has increased from 3 million in 2000 to around 77 million today, of which 18 million are on Facebook, according to Internet World Stats.

In the past year alone, the number of Facebook users tripled in Algeria, doubled in Egypt and Saudi Arabia, and increased 75 percent in the United Arab Emirates, according to an analysis by Omnicom Media Group (OMG). Advertisers have been among the first species to take note of the sea change in consumer behavior and realize the value of the increasing attention online.

While Internet advertising in the Middle East is still in its infancy, online advertising spend in the Arab region is estimated to reach $266 million by 2013 and $1 billion by 2016, up from $56 million in 2009, according to Zenith Optimedia. Advertising companies, web development companies and small start-ups specialized in digital marketing all want a piece of the growing digital pie.

Ahead of the wave

Lebanon-based Eastline Marketing (ELM) is one of the companies offering digital marketing tools and claims to have grown rapidly from its inception in 2006 to cut itself a 20 percent slice of the domestic market currently, with other clients in Qatar and Saudi Arabia. Its founders, Nemr Badine and Marc Dfouni, both graduates from Canada's Concordia University, say their headline offering is Sweepz, the only proprietary platform in the region that supports the Arabic language. Through Sweepz, clients of ELM can launch social media promotional campaigns such as contests, quizzes and sweepstakes, which are linked and regularly updated to social networks such as Facebook and Twitter. The company expects this product, which costs $1,000 to $10,000 depending on the project, to represent 30 percent of revenues in 2012.

ELM offers several other services, such as social media marketing (which includes managing the online presence of a customer) and display advertising: the acquisition of media space, planning campaigns and search engine optimization.

ELM's founders believe that they have now reached an inflection point and in order to grow further they need more capital, and thus are seeking a strategic investor to fuel expansion. Badine and Dfouni estimate their company's value to be at least $3 million.

"Our objective is to position ourselves as the regional leaders in digital marketing solutions whereby international brands would come to us to market their brands in the region and regional brands would come to us to market their brands both regionally and internationally," says Badine. ELM is considering several options: venture capitalists (VCs), angel investors and another round of 'family and friends financing', though "we are in that spot where we are a bit too large for smaller VCs and too small for larger ones," remarks Badine.

As the Middle East becomes ever more wired and the number of users who are 'Facebooking' and 'Tweeting' increase, the prospects for the nascent digital marketing industry seems abundant. ELM has been one of the early movers in this space but their future expansion in a fast changing industry will depend on their securing strategic capital.

© Executive 2012

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