In the age of search, it probably comes as no surprise that yellow page directories have fallen out of favor. What might be shocking is the relatively healthy long-term prognosis they are given in a new study — based on how quickly they are adapting to the digital age.
The ironically titled “Say Goodbye to Yellow Pages: Sales Staffs Retool for the Shift,” released by Borrell Associates on Tuesday, outlines the decline of print yellow page directories as consumers shift to search engines and other online resources to find businesses and phone numbers. But it also predicts a healthy future for yellow page publishers in general as they make a swift, efficient shift online. Who’s to thank? The industry’s ad-sales teams, which have been retrained to address the modern needs of local advertisers.
“Yellow pages publishers have spent the past three years transforming their massive on-the-ground sales forces into marketing consultants who can meet their customers’ demands both in print and online,” reads the report. “Their combined print/online packages are simple, low-priced, one-stop solutions to small-business advertising needs.”
According to the report, local directory companies made about 9 percent of their gross revenues from online sales in 2007, whereas most other local media competitors hovered below five percent. Borrell estimates that directory companies will be earning one-fifth of their revenues from online sales by 2011.
Gordon Borrell, CEO of Borrell Associates, says the shift is due not just to the re-training of the directory sales forces, but to their structure.
The yellow page directories “are selling packages of ads in print at a much lower price point than the newspapers or broadcast TV or even radio guys, so they know how to sell smaller ad packages to smaller business,” he said. “So they’re able to make the transition [to online sales] a lot more quickly as opposed to paper guys, who are used to selling $50,000 or $100,000 packages. It’s harder to get their attention on a $1,000 or $2,000 ad sale.”
That difference explains the name of the report, which is a play on a 1998 Forrester Research study, “Say Goodbye to Classifieds,” about the demise of the newspaper classified business. Much of the report focuses on why yellow page directories are adjusting to the digital age faster than newspapers, despite the similar challenges facing both.
The question for yellow page publishers is whether increased online sales can generate enough revenue to offset the losses they experience from their print business. While the study itself does not make a clear prediction either way, it is optimistic.
“No new medium has ever come along and just killed off another one; it’s always just transformed them,” he said. “TV came along and transformed radio from a prime-time medium to a drive-time one. And now the Internet is doing it to yellow pages.”
“We don’t think yellow pages will disappear,” said Borrell. “Eighty to 85 percent of people still use them at least once a year. They’re eroding, but they won’t completely collapse. They will just transform.”
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