Speaking Sensis

Is traditional media bowing before the online juggernaut? Don’t you believe it.

Well, trounce me with a tablet and tell me I’m a technophobe.

In contrast with the armies of ‘gurus’ claiming an increasingly irrelevant traditional media is on its knees begging for sweet mercy from the digerati, out come the following two reports.

In February, The Nielsen Company’s Australian Internet and Technology Report 2009 – 2010  found that “the continued increase in time spent online amongst Internet users has, overall, not been at the expense of other media.”

Nielsen found that, while, time spent online grew by over an hour in 2009, consumption of traditional media (like TV, radio and newspapers) actually grew as well.

Go figure!

In fact, Nielsen’s results over several years suggest that, while Internet users tend to spend less (but still substantial) time consuming traditional media than non Internet users, the actual time they spend with traditional media has remained pretty well flat for quite a few years now.

In other words, while time spent online has risen massively, time spent offline hasn’t fallen in response.

Then in March, way over the other side of the world, KPMG UK reported a similar kind of trend.

Their Media and Entertainment Barometer for March found that while time spent online grew by 74 minutes in the six months to March, traditional media consumption ALSO grew by 33 minutes.

So what?

I can’t help thinking there’s a really simple, but really important, message in this data.

That traditional and digital together is far more powerful than digital alone.

Digital media is a massive part of our lives today and will play an even bigger role in the future.

But it won’t be alone, because people want choice. They want a paper in their hands and on their mobiles. They want TV in their lounge and on their iPad.

And the more choice people get, the more media they consume.

In short, the future is everywhere, not just online.

Maybe we should put an end to these phoney media wars and start realising we’re all in this together.

Because, clearly, that’s what consumers (and advertisers) want.

The last six months of 2009 was a mixed bag for the Australian media market. While a number of media are experiencing real challenges, the sector as a whole showed slight improvement in the December half, with the Internet and TV (particularly pay TV) being the big winners.

So, do you like a good roller coaster? Well, the ad industry has a pearler for you.

According to the December 2009 CEASA Report – the ‘bible’ of revenue in the Australian main media market – the GFC gave the ad industry a not unexpected whacking in 2009. Advertising expenditure (covering newspapers, magazines, directories, TV, radio, online, outdoor and cinema) fell by 8% during 2009 to about $12.6bn.

Ouch.

Mind you, just like all good roller coasters, just when the slippery slope looks like slamming you into the soil, up you go again. The CEASA report pointed to a slight improvement in the December half. And while things still looked weak, they weren’t quite as bad (in most places) as the June half, suggesting a recovery maybe in play.

To reinforce this trend, the latest SMI report, which came out a few days ago, suggested that the media market gathered the upward force of your average space shuttle in the March quarter, with growth of approximately 10% compared to the same time last year. Mind you, the SMI report doesn’t cover the full market in the way CEASA does, so you can’t directly compare the results.

While this is good news for a media sector that did it tough during 2009, the champagne corks aren’t popping everywhere. In fact, when you look under the hood, you find that the results across different sectors of the ad industry are going up and down like a … well, this is a family blog.

So who were the big winners and losers in 2009?

The Ups

Not surprisingly, online was the only major sector to grow in 2009, although it clearly wasn’t a great year by Internet standards. In fact, the industry looked quite weak in the July and September quarters before staging a strong recovery in December.

And, although it still declined by 6% for the year, TV – that other big screen – was also a winner. That’s because TV did a lot better in December (down 2.9%) than June (down 10.6%). This result was heavily supported by pay TV, which grew by 5% for the year.

In fact, TV revenue did so well compared to other the rest of the market that it actually out-muscled newspapers in 2009 to become Australia’s highest earning media sector, possibly for the first time in history.

The Downs

Of course, what goes up must come down … and there’s a few different media that lost big in 2009.

Newspapers were down almost 16% in 2009, although, like TV, they showed a reasonable overall improvement in the December half. But suburban newspapers defied that trend: the 21% decline they experienced in the December half was actually worse than June.

The other big loser was the magazine sector, which went from a 9% decline in the June half to a 26% decline in December.

But the really big loser has got to be classifieds. All newspaper and magazine revenues tend to be a mix of display advertising and classifieds. And while the display ads didn’t do too badly (national newspaper ads were down 5.6% for the year), classifieds took a bath, with newspaper classifieds down 32% and magazine classifieds down a blood curdling 45% (although they are a small part of the overall magazine revenue base).

Directories down? Well, yes… but not all is as it seems

The other segment that was down in the December half was classified directories, which includes print directories and used to also include The Trading Post print. Although there’s some pretty clear reasons why.

Firstly, the Trading Post print publication was closed during the year. This of course heavily impacts the result.

Secondly, Yellow Pages® and White Pages® print revenues are recognised in our accounts mainly in the half of the year following the sale. So the decline you’re seeing in print directories was actually the decline in sales experienced in the June half, when everyone else also fell.

So that’s it:
•    A media industry that’s coming out of the GFC with what looks like a sudden growth spurt in the first three months of this year;
•    And results across the industry that are so topsy turvy they’ll have your cheeks flopping about like a parachutists’ in no time.

Which leaves me with one final question.

Can someone please pass me that brown paper bag?

Charles Wright recently wrote in The Age how the benefits of search engine optimisation (SEO) and search engine marketing (SEM) for one small business provided a far better return on investment (ROI) than advertising in the Yellow Pages®.

It’s easy to find one example of a business that’s been successful with any sort of advertising. The challenge is to find lots of them. Yellow Pages® has hundreds of examples of advertisers who get a majority of their business through Yellow Pages®. We even put some in our TV ad earlier this year.

Charles’ article was based on a simple assessment of ROI: cost of SEM outlay and the return in website traffic compared to the cost of advertising with Yellow Pages® Online and the subsequent website.

Where his case fell down is that it left out a number of costs a small business faces when gearing up for effective SEM and SEO activity.

These include the costs of building, hosting and maintaining a decent website, and possibly the cost of an SEO/SEM consultancy (or a significant time cost if you are able to do it yourself).

Sure there are online businesses that can manage all this and find customers. But there are a lot of businesses that can’t. Which is where the Yellow Pages® network can deliver real value.

Through its network, Yellow Pages® provides an effective multi-channel solution. With one Yellow Pages® ad, a business goes in the Yellow Pages® Book, Yellow Pages® Mobile, and the 1234 and Call Connect phone services.

In addition, Yellow Pages® also gives businesses a significant online presence by putting them in yellowpages.com.au, whereis.com and by making Yellow Pages® listings available to be searched on Google Maps and Bing Maps.

In fact, if you add up all these print, online, voice and mobile services, you find that Yellow Pages® advertiser content can be searched for through services used by almost 65% of Australians every month.

And that doesn’t include search engines. Recognising their significant value, we’ve made Yellow Pages® content not only searchable through the major search sites but we’ve optimised the content for search engines as well. That’s why over 2.5 million referrals come from search engines to Yellow Pages® Online every month.

People searching Yellow Pages® are buyers, not browsers. And they are often serious buyers who are ready to make a major purchase such as buying tyres for their car, booking an appointment with a dentist, booking a function at a restaurant or hiring a tradesman for work on their house.

The Yellow Pages® network helps puts businesses in more places customers are looking – including major online sites – with ease and convenience, leaving them to get on with running their business.

Sometimes the numbers just talk for themselves. Take Yellow Pages® Mobile usage data…

As you all become devoted (hopefully) readers of the Crunch! column, you’ll begin to notice that my articles all take on roughly the same formula.

Obviously, there’ll be stats… a no-brainer considering this column is meant to be about stats.

But those stats will be surrounded by witty (hopefully) witticisms and insightful (hopefully) insights as well.

There’s a simple reason for that. To the vast majority of the world (i.e. the majority of people who aren’t bone fide pen-holder-carrying geeks), staring at a bunch of numbers is like watching grass grow.

But, every now and then, you come across a set of stats that just talk for themselves – no frilly additions necessary.

Here’s an example.

1.    In October, the Yellow Pages® Mobile audience hit half a million unique visitors for the first time¹.

2.    All up, it’s taken Yellow Pages® Mobile a touch over 18 months to reach half a million unique visitors¹. By comparison, it took Yellow Pages® Online more than five years to reach that mark².

Still think mobile marketing’s sitting on the runway?

Think again.

1.  Omniture. July to October 2009
2.  RedSheriff 2004/2005 data

The AIMIA Digital Summit in Sydney last week included presentations from the likes of BBC, Facebook, Viocorp and Microsoft, research presentations from the Internet Advertising Bureau, Nielsen Online and Research International and case studies from Aussie, Witchery Holdings and Tourism Queensland. To sum up some of the key themes that emerged over the two days… online usage is flattening out but continuing to grow and mobile internet usage is on the up. Companies like Aussie and Witchery Holdings now attribute a significant proportion of their revenue to online retailing.

But, 97% of Australian retail sales are still occurring offline. This highlights the importance of local search services like Yellow Pages, which provide the link between online purchase research and the bricks and mortar supplier.

Jonathon Stinton from Research International explained that with so many channels at the disposal of the consumer and the advertiser, it’s getting harder and harder to determine what the key influencers are over a purchase decision. He calls this the “Twilight Zone of information”. So what are influencers as far as we can tell? Consumers are strongly relying on the web to research retail buying decisions and social media is having a minor but growing impact on this phase of the purchase cycle. With the phenomenal rise in social media traffic, brands want a piece of the action and are exploring ways to tap into this and develop relationships with consumers.

So what should an advertising and media company take away from this? We need to be focused on providing choice to both buyers and sellers – and hence our multichannel strategy. With digital such a major part of many Australians’ search repertoire, Sensis needs to provide the most relevant online and mobile local search experiences possible to bring buyers and sellers together. Speaking on the closing panel, Sensis’ GM of Digital Development Cheryl Vize said this is why Sensis is so proud of innovations like the Yellow iPhone app and why we’re absolutely determined to keep “raising the digital bar”.

One thing seems clearer than ever: there may be no crystal ball, but it’s never been as important as it is now for a business to get the magnifying glass out and really examine the DNA of its target market and what media they are consuming where, when and for what purpose in order to determine how to get the best cut-through.

Ahh, what fun. The phrase “not happy, Jan” of the Yellow Pages® ad of the very same name was voted as Australia’s number one catchphrase on Channel 10’s The Spearman Experiment tonight.

Sensis’ Michelle Sherwood talks to small and medium sized businesses about how to get the most bang for their advertising buck.

Sensis’ General Manager of Marketing, Michelle Sherwood presented to a room of more than 900 small and medium sized businesses at the Small Business BIG Marketing event on Thursday 27 August.

Held at Central Pier in the Docklands, the event was a part of Small Business Victoria’s month long small business festival Energise Enterprise 09, of which Yellow Pages® is a platinum sponsor.

Michelle’s presentation, ‘Making your advertising work for you’ gave the businesses in the room practical insights and advice about effectively marketing and advertising.

Michelle Sherwood on the dais

“With consumer confidence on the increase, it’s more important than ever for your business to be seen by customers when they’re looking to buy.

“Our job at Yellow Pages® is to bring buyers and sellers together, whether that be through print, online or mobile directories, search and mapping websites or telephone information services,” she said.

The Yellow Pages® and White Pages® face to face sales representatives were also out in force, with small business owners flocking to the stands to find out how Yellow Pages and White Pages can help to grow their business.

Luke and Deepak at the Yellow Pages® stand

Visit www.yellowadvertising.com.au or www.whywhitepages.com.au for more information.

Some great commentary was generated by the recent Sensis® e-Business Report. As a small sample of the many discussions occurring in both main and social media, here’s a couple of articles published over the last day or so.

Peter Switzer… “Don’t get left behind online”

Claire Heaney of the Herald Sun… “Businesses flocking to technology“

This year Sensis is sponsoring a series of lunches for members of the Sydney Chamber of Commerce. After two of these lunches, it’s really pleasing to get feedback from this diverse audience that we’ve shared a few things about consumers, small businesses and advertising that they didn’t already know…and actually wanted to know!

I mean, let’s face it, how many times have you turned up to a seminar or lunch only to walk away thinking, I’ve just been robbed of two precious hours in my life and I should demand a refund! I’m not saying Sensis hasn’t been guilty of this in the past… we’ve had our moments like any large business given the opportunity to put someone on the soapbox. But we’re starting to use opportunities like this to – and don’t gag here – help people.  So we asked the Chamber what their members wanted to know to about digital marketing.

And as the chicken and beef mains made their way around the room, our head of Yellow Pages® Digital, Sandeep Baruah, explained that the future of digital marketing in business will see a range of new applications at the disposal of the marketer. The question is what opportunities do they really present to increase brand equity and a company’s bottom line?

For some business, just knowing where to start is daunting in itself.

Sandeep unlocked some of the mystery around digital marketing tools such as:

• Social networking sites
• Search engine marketing
• Search engine optimisation
• Content syndication
• Mobile internet and
• Mobile codes

And he gave the audience a realistic check-list to help them make decisions about their digital marketing strategies:

• Who are my customers and where are they looking?
• What media are they accessing that influences their buying decisions?
• Which of these channels can I use to engage my customers?
• How can I use new technology to integrate campaigns and content across different media?
• Finally, what return am I actually going to see from this investment and how will I measure it?

Answering these questions will help any business go a long way to ensuring that they’re not simply swallowing the hype around new ways of reaching consumers, or putting all of their eggs in one basket.

According to Gerry Sutton, Sensis’ Chief Operating Officer, the Yellow Pages® and White Pages® directories are winning for buyers, sellers, investors and the Australian community.

WA:    Gerry, thanks for your time. You must have been busy since taking over the Yellow Pages® and White Pages® in May.

GS:    You bet. We’re right in the middle of the Yellow Pages® metro sales campaign, and the White Pages® has just kicked off its new campaign. So I’ve been all over Australia… meeting our people and our customers.

WA:    What are your initial observations about the Yellow Pages® and White Pages®?

GS:    Well, as you know, I’ve been very close to these businesses for a long time now. So I can’t give you a true ‘outsiders’ view. But I would say there are three things that have always struck me about our directories.

First up, this is a significant business. Yellow Pages® and White Pages® earns about $1.75bn in revenue and meets the needs of millions of buyers and almost 600,000 advertisers. The bulk of those advertiser customers are Australian small and medium businesses.

Secondly, it’s a real people business. Most advertising connects brands and markets. We’re bringing real people – buyers and sellers – together. Two people at a time. We’re about generating phone calls and store visits from people who are ready to buy right now.

And the way we work with our customers. It’s all person to person. Managing this business is about working with thousands of people to meet the very specific needs of millions… every day.

Thirdly, it’s a very sophisticated business. Yellow Pages® advertisers now reach out to potential buyers not only through the print directories, but an extensive online, voice and mobile network that includes brands like Yellow Pages® Online, Yellow Pages® Mobile, 1234 and Whereis®. And, now, Yellow Pages® listings can also be searched for through third party sites like Bing Maps, Google Maps and Yahoo! OneSearch, which is Yahoo!’s mobile search application.

There are few other media businesses that have broken down the barriers in the way Yellow Pages® has.

WA:    Gerry, you’ve talked about a back to basics approach. What do you mean?

GS:    As I’ve said, this is a real people business. We’ll grow by constantly getting better at meeting our customers’ needs. For us that means more information more easily for buyers and more customers for our advertisers. Do that well and we’ll grow satisfaction, usage, advertiser uptake and, ultimately revenue. It’s that simple.

I’m a big fan of customer satisfaction metrics. They’re no-holds-barred feedback on whether you’re doing the right thing by the customer. And it’s been gratifying to see both buyer and seller satisfaction rise strongly in recent times.

We’ve achieved that by really focussing our attention on customer needs. From the info-rich ad program, which helps advertisers produce more effective advertising, to metered ads, which help them understand ad performance. We’ve launched new services like Yellow™ in the car in nine markets as well as White Pages® Mobile. We’ve added new content products to Yellow Pages® Online and White Pages® Online. These content products help buyers by giving them more information and advertisers by giving them a stronger presence.

And, you know what? These content products have taken off. Take the White Pages® Online Package product for advertisers. Advertiser uptake has gone way beyond our expectations. This one product is almost solely responsible for White Pages® Online revenue tripling in two years.

That’s what I mean by back to basics. Deliver what the customer wants. Do that well and everything else will pretty much look after itself.

WA:    What about usage – particularly print? It’s a pretty hotly debated topic in the industry.

GS:     The Yellow Pages® print directories are valued highly by many Australians. According to Roy Morgan, almost 7m Australians use them every month¹. About 4m of these print directory users are also daily Internet users². These are people who use the Internet all the time, and yet they still see value in using the print directory. After all, it can often be quicker to find and compare businesses in print. At the other end of the scale, about a third of Australian households don’t have Internet access, according to the ABS³. For them, print directories could be their only access to information on local people and businesses.

In saying all this, however, there’s two really important points I need to make.

Firstly, I think the advertising community needs to get beyond this print vs online discussion. We live in a multi-channel world now and the whole print vs online debate is pretty dated.

So we’re really focussed on the usage the combined network delivers our customers. As I’ve said, unique usage of Yellow Pages® print is almost 7m a month⁴. At the same time, usage of our digital network is about 4.8m a month⁵. And unique usage of the third party sites we have arrangements with is about 4.5m a month⁶.

And Yellow Pages® advertiser listings can be searched for through all these services.

Secondly, usage maybe the word on the industry’s lips, but it isn’t, on its own, the main game.

Our customers are interested in winning business – emails, phone calls, store visits and so on. So conversion becomes really important. How many of those users contacted me and how many of them buy? How many leads is my advertising generating for me?

We know from years of research that about 90% of buyers using the Yellow Pages® directory go on to contact a business and about 72% of them buy⁷.

There’s few, if any advertising businesses that can deliver the volume of users and high conversion – in short, the numbers of leads – that Yellow Pages® can.

But now we’re getting more granular with this. As I said, we’ve introduced the info rich advertising program to help our customers create more effective ads. This helps them convert more users into callers.

And we’ve introduced metered ads so our customers can get a really strong sense of not just usage but of the actual calls they’re receiving.

In the end, these numbers – unique usage across all the directories, sites and services, conversion, number of calls – all matter to our customers. Not how’s print doing against online.

WA:    So, Gerry, where do you see the future for directories?

GS:    That’s a good question. I couldn’t begin to answer it completely in a short interview. But here’s a few thoughts.

Directories advertising is traditionally about significant events in a person’s life… weddings, buying a house or car and so on, or unplanned events such as a breakdown of some sort.

And that’s still the major driver of usage. But I think that with the integration of directories content, maps and mobiles into local search, we’ve been able to create a more day to day whenever, wherever you are proposition. Something you use to find your way around every day.

That’s why I think local search and directories is such an exploding market. If you look at usage across all local search sites, it’s grown massively over the last few years.

And I think we can get much better at using our directories to make life easier every day. We can make the whole cross-channel experience much more seamless, with print, online, voice and mobile all talking to each other in different ways.

And we can add sat nav, point of sale scanning and so on.

It won’t matter where you are or what you’re doing, you’ll only ever be a few clicks away from whatever you need.

I guess the other thing I’d add is a comment about digital TV. As you know, I’ve been involved in the digital TV industry for many years. And I’m really interested in seeing how local search and digital TV come together.

But that’s a few years away yet.

WA:    Thanks a lot Gerry.

1: Roy Morgan, Single Source Australia. Average monthly unique users, Yellow Pages® print. April 2008 to March 2009. Base: Austalians 14+
2: ibid
3: Australian Bureau of Statistics, Household Use of Information Technology, Australia, 2007-08
4: Roy Morgan, Single Source Australia. Average monthly unique users, Yellow Pages® print. April 2008 to March 2009. Base: Austalians 14+
5: ibid.
6: ibid.
7: Percentage of serches conducted using the Yellow Pages® Directory that resulted in a business or supplier being contacted. Independent research of people aged 18-64, conducted by TNS in Sydney, Melbourne, Brisbane, Adelaeide and Perth, January – March 2007 and July – December 2007.