For several years internet yellow pages and other “horizontal” directories have been losing traffic. It’s partly result of Google’s unpredictable algorithm changes and the degree to which the company is obscuring or pushing organic results “down the page” with its various SERP redesigns and experiments (e.g., the local carousel).
Yet the loss of “IYP” traffic is also a function of the failure of most directory sites to evolve with the market, as well as changing consumer demands and the pressure of intensifying competition and fragmentation in the local space.
When I first started writing about “local search” in roughly 2001 there were few local data sources and they were costly. It was difficult for startups to compete with directory publishers. Even Google was thought to face barriers to competition. Now “two guys in a garage” can develop an app and get a complete local data set for free from one of several sources.
BrightLocal recently documented the declining traffic that many of the big US directories have suffered over the past year, which is part of a longer-term trend. According to the company’s traffic analysis, relying primarily on Quantcast data, only Yelp, Whitepages.com and Local.com saw traffic growth in 2013. Most other directories have seen significant losses by comparison, with Citysearch and Insiderpages experiencing fairly massive traffic declines.
Simply put, the content at most of these sites is too limited or thin. There’s also a general lack of differentiation among them and relatively few “brands” that consumers know. If you’re just looking for a phone number or address, any (presumed) accurate source will do. And most of the time that’s Google (see Mike Blumenthal’s post).
Among those in the chart below, Yelp has a brand; so do Mapquest and Angieslist (based on lots of national advertising), although that apparently didn’t help in 2013. Citysearch used to have a brand. And YP is investing heavily in marketing its consumer property and seeking to reinvent and extend its brand beyond “yellow pages.”
Most of the brands in the local space are now verticals, including Zillow, TripAdvisor, Square and OpenTable. Groupon, seeking to evolve into a local horizontal “marketplace,” also has a brand – though not without some problems.
All this raises the question about what to do if you’re a directory publisher and especially for traditional yellow pages publishers. Do you still try and compete for consumer traffic or give up the fight and just focus on advertisers?
In 2009 I wrote a post entitled, If I Were a Yellow Pages Publisher. In that post I argued that publishers needed to experiment and try a range of things:
- Relying on Google SEO is a losing game over the long term. You’ve got to do SEO and get even better at it — optimize for the long tail and so on. But you’ve got to develop a brand.
- Build out verticals or alternative brands that appeal to different demographic segments.
- Get very aggressive about mobile
- Invest in social and utilize existing social media tools
- Encourage employees to take risks and be creative, create a “lab” (startup-like environment) where people can try things and fail
To my knowledge, not much of this happened. My position has always been that consumer-facing brands and traffic are important to the B2B side of the business as well. (If you’re just another marketing vendor, why would the SMB take your call?) As a practical matter, however, it may now be extremely difficult for some publishers to “keep up” on the consumer side.
It may be publishers don’t have the resources to keep competing in the consumer market. I don’t entirely accept that however.
In an ideal world directory publishers would have been making startup acquisitions in the local space for the past several years for technology, users and personnel. But many of them have been constrained by debt and so have been unable to.
Then there’s the problem of integration and execution. RH Donnelley’s 2007, $350 million acquisition of Business.com ultimately went nowhere.
I’m not saying anything particularly insightful when I argue that directory publishers need to substantially shift their focus to mobile (to the extent they’re not “giving up” on consumer traffic). Mobile users are also a way for them to acquire new content (check-ins, reviews, images, etc.), which can be “imported” online. They can also build and iterate on mobile apps much more quickly than the PC destination.
Mobile is also a way for directories to experiment with vertical experiences and functionality (scheduling, payments), which would be more challenging online.
When Facebook recently announced its intended acquisition of WhatsApp, I likened the company to Proctor & Gamble: it’s developing a range of “stand alone” mobile apps and emerging as something of a “holding company.” That was an approach I recommended IYP publishers take in 2010.
There have been a couple of examples, such as YPG in Canada, European Directories in Europe and YP in the US to a lesser degree in the past. But nobody has really pursued the approach with vigor and enthusiasm. It does raise the difficult question of how the various apps are branded and promoted.
Yet I think the strategy still has merit. Regardless, directory publishers should be investing in and aggressively developing mobile apps (and experimenting). Some products will be hits, others won’t.
This model assumes certain changes in the culture of these organizations, in order to allow this sort of experimentation, innovation and failure. However organizational culture, rather than development resources, may be the greatest challenge of all for these publishers.
Your thoughts? Do you think that directory publishers should simply give up on consumers and focus all their resources on advertisers? If not how might they better compete for consumer traffic?
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