The success of Overture and Google’s paid listing programs has many industry experts speculating about the future survival of printed yellow page telephone directories.
How viable is the threat from the search engines? And how are the traditional directories responding? These questions and others were the focus of a provocative panel titled State of Digital Yellow Pages at this year’s Directory Driven Commerce Conference, held this week in Denver, Colorado.
Panelists were representatives from both the online and print world, with experience in both U.S. and European markets. The panel’s format featured analysts presenting controversial statements in part derived from a recent white paper by conference sponsor The Kelsey Group, and inviting panelists to respond.
The white paper, Searching For Profits: Yellow Pages and the Challenge of Pay-Per-Click was a broad-ranging study of internet yellow pages, and emerging alternatives, such as online city guides and localized pay-per-click listings from search engines.
Here are some of the more interesting, often controversial statements from the Kelsey Group, with the responses of the industry panelists.
Print publishers are not investing sufficiently in digital yellow pages because of the much greater profitability of their print books.
Dave Galvan, Senior Manager, Business Development, Yahoo Yellow Pages: “Publishers not under investing, but not over investing, either. The partners that we have are taking it relatively slow. They’re definitely not putting their heads in the sand, because they know that if they do that in two years they’ll be dust. But they’re taking it a little more slow.”
Peter Buxton, Consultant, Buxton Independent Consulting: “The ultimate challenge is positioning. Some customers get a lot of value from the Internet, versus others that get no value at all.” Buxton believes that yellow pages publishers are increasingly recognizing that internet yellow pages are a new and parallel service to print. He sees growth in both print and even more rapid growth in the internet arena. But this is not happening at the expense of print yellow pages.
The term “yellow pages” has not caught on the digital world. Search is a much more powerful idea in the minds of internet users.
Steve Yeich, GM & VP, Local Search, Overture Services Inc.: “This is a US centric question. Search is where the traffic is. Ultimately, it’s all about finding ways to provide users with locally relevant information. So we’re talking about partnerships and a distribution network that involve all of those — Yahoo, MSN — about distributing our local listings as search results (available in the next few quarters). ”
Regarding the recent consolidation trends in the search engine world, Yeich said, “It’s not clear that we’ll see the same consolidation when it comes to local listings. That’s why we want to power any and all local traffic online that’s relevant. There’s an opportunity to make the user experience a lot more robust and user-friendly.”
Valerie Shwartz, Director – Strategy, Organization and Quality, Pages Jaunes (France): “We don’t think about yellow pages vs. search. People looking for something go to where they think they’re going to find it.”
Shwartz cited the pictures available in Pages Jaunes online directory of every street in Paris. Rather than picking out a restaurant by type of food, you can use picture search to see what eaterys look like before visiting them. “Search isn’t something opposed to yellow pages,” she said. “We just need to be accurate in what we give as results.”
Local search is imminent and a direct threat to yellow pages.
Overture’s Yeich believes that the company’s services are completely complementary with Yahoo search listings and Yahoo yellow pages, and furthermore complementary with print and online offerings from both independents and incumbent traditional directory publishers. Speaking to representatives of these firms in the audience, he said, “Ultimately, we’d love to power distribution of local listings on your properties. Are you in business of printing books with yellow pages or are you in the business of directional advertising?”
Yahoo’s Galvan noted that all yellow pages is local search. “Local search and internet yellow pages products have a purpose, but those products in and of themselves have challenges — scaling, distribution, selling. Selling is still the lifeblood of these products.”
Bottom line: Will search engines kill traditional directory services? Not any time soon, say the panel of experts. Paid listings offered by search engines are complimentary now, and are mostly effective for online merchants who can directly measure the ROI of their campaigns. Local yellow pages listings, by contrast, rely on an army of sales people who can guide local, often non tech-savvy customers, a completely different model than the self-serve approach used by search engines.
For the foreseeable future, anyway, it looks like both paid listings and traditional directories have a comfortable and growing future.
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