The Yellow Pages Today April workshop featured a divergent view of how best to sell the White Page product line. While some differences exist, due in part to the products offered in the core White Pages product such as those published in Germany, most companies agreed that White Pages needs its own unique sales approach and marketing focus.  The real difference lies in the publisher’s view of White Pages as a major revenue component, a supplemental revenue component or a complement to the core Yellow Pages product. For those with a view of White Pages as a revenue driver, major product development and sales training have focused specifically on the unique aspects of what White Pages offers advertisers and the product sets that are particularly attractive.  

Vincent Thibaut, print product manager for Truvo Belgium, pointed out that White Pages is often overlooked as a vehicle for attracting new business. As consumers are given recommendations of businesses or products or are exposed to them on other media, they often turn to White Pages online or in print to get the contact information. Thibaut also supported the idea that salespeople need to outline the unique benefits of White Pages to ensure advertisers clearly understand what they are buying.  

Sensis has taken a renewed interest in building its White Pages product that has centered on retraining and refocusing White Pages salespeople on the value of the product, since it is a different sales proposition that is less reliant upon size and position. The renewed approach seems to be paying off, delivering 10 percent growth in the first half of 2008.   

The focus of the Yellow Pages Today April workshop was on White Pages with the underlying theme of how the product can survive and the regulatory environment that will either help or hinder its growth or decline.

The opening session with Stephanie Verilhac, EADP EU affairs officer, covered the current state of the EU privacy directives as well as the upcoming 2007 Telecom Review. The core message is that several of the EU states have fulfilled the goal of opening up competition and have been omitted from the 2002 regulations while seven countries will remain under regulation until competition advances to an acceptable level. The privacy regulations continue to affect the major online portals, which must turn to partners like Yellow Pages publishers to gain access to local databases or build their own.

Following Verilhac was Claude Merchand from PagesJaunes who spoke from a publisher perspective on how the EU directives and regulations are affecting his organization. One of the key challenges is the relationship PagesJaunes has with France Telecom in what content to include in the book and how to structure the revenue agreements. Merchand sees a day when it might be possible to operate separately from the telecom in delivering a Universal White Pages.

Up next was Dolf Weiler, marketing director for De Telefoongids, who pointed out that White Pages is no longer just print and that his organization is actively investing in broadening the White Pages portfolio. Weiler said as long as publishers are willing to invest in and experiment with White Pages, it can continue to be successful. One key sales point he made was that 25 percent of the population in the Netherlands does not use online to look up local business information, which means WP is better suited to reach the majority of the buying audience since it has print, online and mobile products that reach nearly 100 percent of the population.

One dilemma pointed out in the presentation is that people want to be able to find any person or business but are reluctant to provide their own personal or business data, which makes the completeness of the database a continual challenge. When talking about the notion of sharing data with mojor portals such as Google and MSN, Weiler warned, “Be wary of handing the crown jewels to your greatest competitor.”

Via video conference, John Hillrich of Idearc shared his company’s strategy of expanding the WP concept to include direct mail and a new mover product called Solutions on the Move. While not a major revenue driver for Idearc at 4 percent of revenue, it remains a valuable product to leverage additional AVO to lift overall spend.

The final presentation of the morning was from Sensis’ Melissa Reynolds and Geoff Hoffmann, who outlined the publisher’s energized strategy toward White Pages that led to an unprecedented 10.3 percent gain in the first half of 2008. One of their key points was the new focus Sensis has had on developing a sales process and differentiating the White Pages product from the major portals. The publisher has zeroed in on the consumers need for information in the White Page products and how that can lead to product innovation and increased usage and sales.

The current distribution of the AT&T’s Real Yellow Pages produced by Dex (R.H. Donnelley) will no longer include the Chicago Metro Residential White Pages.

According to the release:

“Local residential listings are already included in the Chicago Neighborhood directories that we deliver in August, on DexKnows.com(TM) and on YELLOWPAGES.COM, so we felt it was better for consumers if we discontinued delivery of a standalone Chicago Metro Residential White Pages directory,” said David Kelly, director of marketing, Dex. “However, people who still wish to receive the Chicago Metro Residential White Pages can contact us and we will happily supply them with a complimentary copy.”

While this strategy has been in practice with Canada’s Yellow Pages Group in select major cities, this is the first such instance where a major U.S. publisher has opted not to deliver a residential White Pages edition while offering consumers and businesses the option of requesting a copy. With a high focus on the environmental impact of directories, this is an interesting move given no formal opt-in movement has been instituted in the Chicago market. It will be interesting to see if this is a leading trend with publishers as a self-imposed means of addressing public concern.

Update: It’s worth clarifying that R.H. Donnelley has not eliminated residential White Pages. It is eliminating (except by request) the stand-alone metro-wide residential White Pages book, while continuing to deliver business and residential listings via community directories. R.H. Donnelley publishes 13 such community books in the Chicago metro area and their combined coverage exactly matches the metro book, according to a company spokesperson. So while this approach seems like an opt-in plan, technically it is not, since an opt-in plan would give consumers the clear choice between receiving or not receiving residential listings.

One of the most significant announcements in the past year about the Yellow Pages business was made by PagesJaunes. In order to get in front of the faster migration from print to online that is occurring in France’s major cities, the publisher reduced print advertising rates in Paris by 20 percent in 2008. Overall print directory revenues in France were essentially flat in 2007, while online service revenues grew 15.1 percent. This traces primarily to Pagesjaunes.fr, which averaged 10.7 million unique visitors per month in 2007, an increase of 22 percent, the sixth most visited site in France.

One notable figure here is that print Yellow Pages and White Pages together account for only about 61 percent of total PagesJaunes revenues in France. We expect print to increase in coming years due to an announcement that was made this week under the headline, “Lawyers are allowed to advertise in the Yellow Pages, says the French Supreme Court.”

From Advertising|France (Tues. 25/03/2008):

“In a judgment of 6 December 2007, the French legal Supreme Court (”Cour de Cassation”) has recognized the right for lawyers to advertise in the Yellow Pages. This has been done against the judgment of the Appeal Court from Bourges (second instance court) who had stated that “an advertisement in the Yellow Pages, be it on paper or on the Internet, was contrary to lawyers’ professional rules.

“The judgment of the Cour de Cassation paves the way for new possibilities for advertisements for regulated professions in the Yellow Pages.”

In the U.S., the attorney category accounted for 9 percent of publishers’ total print revenues in 2005. The opportunity for other “regulated professions” to begin advertising both in print and online offers PagesJaunes strong potential for growth. At the same time, the company anticipates its online share will continue to grow and projects that its margins will also be higher.

It appears that Yellow Pages in France continues to be a very healthy business. In the past two years, PagesJaunes’ number of total advertisers has grown 7.5 percent, and its retention rate is strong at 86 percent. PagesJaunes, like Yellow Pages Group and other Yellow Pages publishers, has shown that this can be a growth business.

Sensis, Australia’s largest directory publisher, recently released first-half results from its 2007-2008 financial year (ending June 30), which show solid growth of its print products. White Pages in particular grew 9.9 percent in the first half, an improvement over its 8.1 percent growth a year earlier. Print Yellow Pages also showed a real turnaround, growing 0.2 percent, compared with a 2.5 percent decline a year before.

Sensis credits a number of factors in improving print results, including a major emphasis on proving the value of print Yellow Pages, backed up by 4,000 metered ads provisioned throughout Australia.

Although TKG’s recently issued forecast projects an overall decline in print directories, Australia is one market where we expect modest growth in print. While Sensis faces relatively little print directory competition, it still grapples with many of the same issues as other publishers, including online competition and challenging major metro markets. One caution on these first-half print results is that much of the publisher’s major metro titles are recognized in the second half of the financial year.

That said, Sensis’ results demonstrate how paying attention to sales skills and proving value can move the needle in print. Publishers that decide to harvest print and focus all their energy online will likely accelerate migration faster than they can manage, risking negative overall growth. Publishers that see value in investing in print as they build out their online business, even if only to reduce the rate of decline, will have a better chance of experiencing positive multi-product revenue growth.

European Directory Assistance has launched a new English-language directory assistance site in Belgium called 14-14, which offers residential and business search, with the latter available by name and category. Part of the new service’s positioning is that during business hours, consumers prefer Web-based over phone-based directory assistance.

According to the release:

“EDA’s specific aim is to reach the large expatriate community living in and around Brussels, who often speak neither Flemish nor French but generally converse in English, for instance people working for the European Union, NATO, Eurocontrol or the numerous multinationals established in Belgium.”

EDA operates phone-based DA services in Belgium (French and Flemish), Ireland and the Netherlands.

My colleague Michael Taylor and I spent part of this week in London, making the rounds among some of the key players in global directories based in that wonderful and surpassingly expensive city (sorry, kids, no souvenirs). One of our last calls was to see Andrew Day, CEO of Truvo (ex-World Directories), who walked us through his company’s perspective on the recent deal with rival European Directories to consolidate the Dutch directory market, as well as a discussion of Truvo’s commitment to selling print and online directory products through distinct sales channels.

The deal to consolidate the Netherlands directory market has Truvo exiting the Netherlands (assuming regulators approve the deal next year) and European Directories rolling up the two brands, Gouden Gids (Truvo) and DeTelefoongids (ED), into a single directory platform. The two publishers have fought a bitter battle for market share over the past several years.

We used the opportunity of our meeting to ask Day about the deal. Essentially he said the Dutch market is increasingly online focused and more suited to a single print publisher. He noted (in a point echoed to us by European Directories) that research among Dutch SMBs supported the idea of a consolidated market (one print buy instead of two to reach the same coverage), and the Dutch business press has largely supported the idea of consolidating print into a single entity.

Day’s company is owned by the private equity firms Apax Partners and Cinven. And as Day noted, “Private equity is very pragmatic.” In other words, Truvo’s owners did not see the sense in continuing a bitter fight in the Netherlands when investment might yield better results in other markets.

One example is Portugal, where print revenues have been in steady decline, but Day says strong online growth means that market will see net growth in 2008. He did not rule out other acquisitions in the future. South Africa, a market in which Truvo is a minority owner of Telkom Directories, is one possible acquisition. Day says that otherwise Truvo is focused on opportunities in Europe.

Regarding Truvo’s decision to use separate print and online sales channels, Day said the approach is “right for where we are today.” However, he did not rule out changing the model in the future if the company’s needs or the dynamics of the market change. For now, he says, the approach works. One key is to have sufficient time separation between the print and online sales calls, so the two channels are not selling over each other or annoying the advertiser with multiple sales calls.

Finally, we asked Day when he expects his company, which now has about 23 percent online revenues, will have half or more of its revenues coming from non-print sources. “Within five years is not unrealistic,” Day said, adding, “I would welcome it.”

Day also hastened to add that he doesn’t want to reach 50 percent online revenues by accelerating the decline in print. Still, he made it clear that he sees all his company’s future prospects for growth inexorably linked to its prospects online. And this helps explain why Truvo does not want to spend its resources fighting a war of attrition in print in the Netherlands when there are other battles to wage that could produce greater strategic advantage for Truvo.

An article in the Australian newspaper confirms that Sensis will need to pursue acquisitions in order to meet the five-year growth objectives set out by Telstra CEO Sol Trujillo back in 2005. Telstra is Australia’s leading telecom and is the parent of Sensis, the leading directory publisher. In 2005, Telstra vowed that Sensis would double its revenues to about A$3 billion by the 2010-11 financial year (Telstra’s year ends June 30).

Financial analysts have long been skeptical about Sensis’ ability to meet that goal without acquisitions. The newspaper article quotes Sensis CEO Bruce Akhurst as saying that M&A “will be required to reach our goals of more than $3 billion in revenues in FY2011.”

The article also quotes Akhurst as saying that Sensis has seen improvement in its Yellow Pages and classified business, and that it expects White Pages to grow at a double-digit pace in the 2008 financial year.

It’s unclear what Sensis will acquire. The company has been an active buyer in the past, with somewhat mixed results. Notably its 2004 acquisition of Trading Post has struggled under Sensis ownership. The publisher was an early bidder on New Zealand’s Yellow Pages operation but withdrew as the price rose. A private equity group later acquired that operation. We would expect Sensis to focus on online-oriented acquisitions in the region.

France’s PagesJaunes has long been the dominant player in the country’s print directory market, but in recent quarters, what was a growing business now is struggling to generate positive revenue growth. Online, however, continues to be a strong suit for PagesJaunes, and its experience points to some key differences between some European markets, where IYPs are often among the most-used sites, and the U.S., where incumbent publishers’ position online is far weaker than it is in print.

Through nine months of 2007, PagesJaunes’ online operations in France generated revenues of 252.4 million euros, a 23 percent growth rate. This does not include Minitel, a legacy closed system online service that is being effectively phased out by France Telecom.

The mainstay of PagesJaunes’ online business, pagesjaunes.fr (which launched a new version in September), showed a 17 percent increase in unique visitors in September (compared with September 2006) to 10.9 million unique visitors. Citing data from Nielsen/NetRatings, PagesJaunes claims 42.1 percent reach for its IYP, which the publisher says makes the site among France’s most visited and the most visited IYP in Europe.

By contrast the print business declined 0.6 percent through nine months, to 477.8 million euros, with White Pages decreasing 2.6 percent and Yellow Pages down just 0.1 percent. The publisher expects improvement in the fourth quarter to bring revenues roughly to their 2006 level.

AT&T Advertising & Publishing’s effort to assuage environmental concerns in North Carolina by curtailing print residential White Pages distribution has fizzled out as utility commissioners in that state have balked at the plan.

The Raleigh News & Observer reported today that AT&T has withdrawn its proposal to eliminate residential White Pages delivery except to those that request print copies of the book. The decision follows an Oct. 15 hearing at which utility commissioners voiced suspicions that AT&T was using environmental concerns to mask its true motive, which was to cut costs by eliminating residential White Pages delivery. According to the article, commissioners noted that AT&T was not making any plans to cut distribution of print Yellow Pages, a known profit center.

Commissioners further reasoned that cutting print White Pages delivery will drive more calls to AT&T’s directory assistance service, hence another hidden motive behind the plan.

Our view is simple. Yes, there is gambling going on in Rick’s Cafe. AT&T and any other publisher would prefer to contribute to the effort to reduce solid waste by eliminating a cost center — White Pages — rather than a profit center — Yellow Pages. It doesn’t seem unreasonable for a publisher to prefer this route, and the commissioners are misguided in seeing something nefarious in this effort. Take that deal and make some progress in eliminating solid waste.

The commissioners seem to be taking the position that AT&T must make a financial sacrifice in the cause of reducing the amount of paper floating around. This is unrealistic, and it ignores the fact that print Yellow Pages, while often perceived to be obsolete, still drives a lot of leads to local businesses in North Carolina and elsewhere. The obsolescence argument is much more on target with print residential White Pages.

Maybe what AT&T proposed was a little too clever, leaving the commissioners feeling like the company was trying to pull a fast one. But in the end, the idea makes sense. Opposing the elimination of White Pages just because it benefits AT&T suggests that the industry has a tough road ahead in making what should be an obvious concession in the name of environmental stewardship. If regulators insist on the elimination of print Yellow Pages, the industry will fight it all the way, and little if anything will be achieved.