Myth Busters – Dispelling Misconceptions about Yellow Pages

Myth Busters – Dispelling Misconceptions about Yellow Pages
Tuesday, December 11, 2012
Amy Rybczynski

Five years ago, at Microsoft’s Strategic Advertising Summit, Bill Gates made the following prediction:

“Yellow Page usage amongst people in their, say, below 50, will drop to zero, near zero over the next five years.”

Five years later, I can assure you that his prediction did not come true. Not only is the industry still around, but usage (even by the under-50 crowd) is still solid. The print product is still drawing millions of leads, and the industry as a whole has continued to evolve within the modern marketplace. By adding digital elements (i.e., QR codes, unique URLs) to the print product and enhancing its suite of offerings with digital elements (Internet Yellow Pages listings and mobile placements), the Yellow Pages remain a relevant part of the purchase process.

There are plenty of myths about the Yellow Pages out there, and today we’re going to look at five in particular.

Myth #1: No one uses the Yellow Pages

This one is simply false. We have hundreds of tests and countless other pieces of research that prove otherwise. The top Yellow Pages heading, Restaurants, still receives nearly 700 million references annually, and seven other headings are estimated to be over 100 million references each year. Over 400 headings bring in at least 1 million references. That’s a lot of people searching! In addition, across the 2,614 print Yellow Pages test lines that DAC Group tracked in the U.S. and Canada for the month of September, there was well over 36,000 calls…which means that a lot of people are picking up the phone as well! The tracked lines represent a variety of headings, including Auto Repair, Appliance Repair, Carpet Cleaning, Plumbing Contractors, Bankruptcy, Insurance, Physicians, Pest Control, and many others. Those tests represent just a fraction of all the ads placed by DAC Group, let alone the thousands of other print advertisers out there.

Myth #2: Only older people use the Yellow Pages

While it’s true that the internet is becoming a prime source of information and a ubiquitous presence in the lives of younger generations, DAC Group’s 2011 Search Landscape Study in association with Kantar Media showed that there is usage among younger age groups. Around one-fifth of those surveyed in the 18-24 age group mentioned Yellow Pages as one of the top three media that they reference when looking for business information to make a purchase. Among the 25-34 age group, 20% of U.S. respondents and 27% of Canadian respondents mentioned the Yellow Pages among their top three. Beyond that, as might be expected, older age groups did utilize the medium more often, but the results prove that usage is not limited to that group only. Keep in mind that much of Yellow Pages usage is driven by life events (marriage, divorce, children, home buying & maintenance, etc.), and those events tend to happen more often to older age groups. Young people tend to use it less because they don’t have the same events driving usage.

Myth #3 – Yellow Pages are a waste of paper

It was big news in the industry recently when the U.S. 9th Circuit Court of Appeals ruled that Seattle’s law banning Yellow Pages delivery was unconstitutional because it violated the right to free speech. A big driver of the original legislation was that Yellow Pages are a waste of paper and other resources. However, the industry has gone to great lengths in recent years to reduce its impact on the environment. According to the Local Search Association, many publishers have reduced directory sizes and use paper made from recycled products and leftover woodchips from the lumber industry. They also cite a report from the Paper Industry Association that 87% of Americans recycle their old directories. Most importantly, the industry has created a website, YellowPagesOptOut.com that allows customers to choose which directories, if any, they want delivered. This cuts down on the waste and litter produced by unwanted directories sitting on doorsteps or being dumped directly into the trash. All of these steps have reduced the amount of paper used by the industry by 50% since 2007.

Myth #4 – Yellow Pages customers aren’t quality customers

Yellow Pages users are often perceived to be frugal shoppers. However, research has shown that Yellow Pages users spend more and are more likely to make a purchase. As mentioned previously, much of Yellow Pages usage is tied to life events, and these are often emergencies or other time-sensitive purchases that don’t allow for extensive price comparisons or waiting for a great sale. CRM Associates’ 2011 Yellow Pages Trends & Opportunities report noted that, according to the Simmons Spring 2011 National Consumer Behavior Study, Yellow Pages shoppers typically spend nearly 30% more than average consumers. And because consumers only reference the Yellow Pages when they are actively shopping, they are automatically a more qualified lead than someone who happens to see an ad on TV or is doing online research to merely decide if they want to buy.

Myth #5 – Yellow Pages advertising is too expensive

Advertising costs money, no doubt. There are affordable options online for sure, but again, you know that when someone references the Yellow Pages, they are actively shopping and ready to make a purchase. I mentioned in my last post that CRM Associates found that Yellow Pages had a 42% conversion rate, as compared to rates around 5% or lower for other direct marketing media. If you’re going to spend money on advertising, wouldn’t you prefer the medium with better odds of converting a lead to a sale? In addition, as I mentioned above, many publishers have diversified their offerings to include digital media as well, so those looking for an online presence can utilize a print and internet Yellow Pages bundle for a discounted cost. Finally, we always encourage testing placements to determine if the medium is working for the client, so a small investment in testing can prove whether Yellow Pages advertising is well worth the investment, or save the client money in the long run if it’s determined to not be a good fit.

Five years after Bill Gates predicted the industry’s demise, the Yellow Pages are still going strong. Part of their strength is their ability to adjust to a changing marketplace, but their key strength is what it always has been—they provide shoppers with the information they need whenever they’re ready to make a purchase.

Amy Rybczynski, Marketing Research Analyst