One of the prevailing messages coming out of the local search world in the past few years has been that the Yellow Pages are dying. This attitude came to head earlier this year with Bill Gates' prognostication that the Yellow Pages lookups in five years will approach zero.
Amidst the hand wringing and doomsday predictions have been outposts of optimism, most visible at industry conferences such as last week's Directory Driven Commerce (DDC) Conference hosted by The Kelsey Group.
Over the past few years, the attitude towards online competition from some attendees and speakers of these shows has followed a Kubler-Ross like progression of denial/anger/bargaining/depression/acceptance. But the current state of acceptance by many in the industry today is coupled with a desire to repurpose existing strengths to take advantage of the growth in local online advertising and search.
Putting the Best Foot Forward
Through all of this, the rally cry at industry conferences has focused largely on the Yellow Pages sales force, in rebuttal to moribund claims, and in recognition that it is the biggest asset they have. This asset, the thinking goes, will be the saving grace in maintaining favorable margins in the face of competition from Google and Yahoo.
For the foreseeable future, many DDC speakers contended, there will be the segment of the small business marketplace that will not self-provision pay-per-click or other online advertising, but will rather be closed by Yellow Pages sales reps. In other words, advertising for this massive, yet fragmented sector of the U.S. economy is not something that is bought; it's sold.
Taking online usage and ad growth into consideration, the battle cry during many DDC sessions was that the Yellow Pages industry needs to execute better on cross-selling, and bundling print and online ads.
This is easier said than done, of course, because effectively selling online sometimes means down-selling higher margin ad spends in the print Yellow Pages. It's a similar cannibalization concern that has prevented many newspapers from embracing and executing effective online strategies.
So how the heck do Yellow Pages publishers do this? Scott Pomeroy, president and CEO of Local Insight Media (fifth largest directory publisher in the U.S.), asserted during his keynote the need to execute this direction shift down to the street level. More specifically, publishers need to recruit and train sales reps that are more digitally savvy; train reps with a holistic sales message rather than viewing online as an afterthought; and reverse existing incentives for reps to push (higher-margin) print ad sales.
Through this, a clear message from Pomeroy and others was that the sales channel must evolve into a more consultative role with a high touch point with the small to mid-sized business (SMB) marketplace. This means facilitating the sale of not only Yellow Pages ads and Internet Yellow Pages (IYP) ads but also SEM, SEO, PPC and the rest of the online alphabet soup that SMBs will not understand on their own, much less go out and buy.
"We must see ourselves primarily as lead generators with many tools to get there," said Pomeroy. "This message must be passed to the sales rep in a tighter way. This is the first step."
Yellow Pages in Motion
Another way that some Yellow Pages publishers are getting progressive with online models is with video advertising. Within the last year, we've seen video ad integration by SuperPages.com, Yellowbook.com and others; as explored in past SEW coverage and in a recent Kelsey Group report Online Video: A New Local Advertising Paradigm.
The thought is that video can be a nice user retention tool – in line with users' growing affinities toward online video – as well as a draw for advertisers who are increasingly asking for video ads.
Video inventory is in fact flying off the shelf, according to Jeff Folckemer, COO of White Directory Publishers, which is selling roughly 50 video ads to small businesses per week, and growing. His product has a low barrier model that involves splicing together still photos of a business into a "pan & scan" slideshow. See an example here.
"Our costs are the price of a digital camera," he says, adding that the price to advertisers is $50 per month with the opportunity for an upsell to a higher-end motion picture ad. Elsewhere, higher end videos are shot by providers such as TurnHere, whose VP of business development John McWeeny also sat on the panel.
Citysearch VP of product strategies Rob Angel was likewise on the panel, and has integrated (with the help of TurnHere) more small business video ads than any other local search or IYP destination. But video is just the beginning, according to Angel, whose company has also integrated user reviews and menu content for a more "3D" experience to put users in the restaurant; appeal to as many senses as possible, and move beyond static directory listings.
User-Generated Content: To Be or Not to Be
As was explored in an SEW column last week "Think Local, Act Social," user reviews are quickly becoming a new standard in local search. A panel discussion at DDC picked up where this column left off, and batted around a few differing opinions about the benefits of user reviews, their challenges in practice, and if now is the right time for the marriage of user-generated content and local search.
For a long time, many IYPs have been hesitant to integrate reviews for fear of the impact that negative reviews can have on advertiser retention. There is evidence that many IYPs and local search destinations are getting over this; or that we've reached a tipping point where the competitive need for reviews has outweighed this concern.
"I think most IYPs are over the fear of potentially losing an advertiser due to a bad review," said Yellow Book senior manager Alfred Chow. The bigger concern, he claims, is that small numbers of reviews and inconsistency across categories will lead to an inferior product.
"I'm OK with an advertiser getting bad reviews. However, the reviews must be credible," he said. "Credibility can only be achieved by many in-depth reviews." This comes down to the core challenge, explored in last week's Vertical Challenge column, that it's difficult to motivate reviews outside of popular categories in urban areas.
"People aren't writing reviews in these categories," says Chow. "There is no long tail, the tail has been cut off, and there is just a stump."
Walking the Talk
Evolving the sales force, launching online features, and all of the calls to action expressed at DDC, though getting louder, have reverberated to varying degrees through Yellow Pages industry conferences over the past few years.
But some publishers are really beginning to show signs of embracing online ad distribution through IYP redesigns; product launches (i.e. video ads); and partnerships with search engines and online pure plays to resell pay-per-click and other forms of advertising through their valued sales channel.
It could take a while for the shift that needs to happen, but the wheels are turning. Given the undeniable sales channel asset, these will continue to be very big and powerful wheels if steered in the right direction.
Michael Boland is a senior analyst with The Kelsey Group’s Interactive Local Media program, and a contributor to the Search Engine Watch Blog, focusing on local and vertical search topics. Prior to joining The Kelsey Group, Boland spent several years as a technology journalist.
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