Understanding Yellow Pages vs. Google vs. MerchantCircle: an Interview with Peter Krasilovsky
I wrote yesterday on MerchantCircle, a service that's encroaching on Yahoo Local Listings by giving local merchants a free info web page (*with a map* MC CEO informed me - the map addons cost extra) along with a blog and list serve capabilities.

They're also seeking to win local business ad spend share from the Yellow Pages. In my post I lamented my lack of knowledge of the YP industry, and proceeded to charge into the comparison with Yahoo, which I'm incrementally more familiar with. Peter Krasilovsky, whose MerchantCircle coverage I cited, visited the post and commented.

He stated, "Merchant Circle... ...has kind of a mediocre Yellow Pages offering."

For the last five years I've thought of the Yellow Pages as a NON-OFFERING. For someone withouth much knowledge of the YP industry I certainly had strong *OPINIONS* :)

I wrote Krasilovsky - the founding director of the Kelsey Group's Local Online Commerce program from 1999-2001 and currently runs Krasilovsky Consulting - to mine his brain on the Yellow Pages industry.

I wrote:

Thinking of the YP as an *offering* was tough for me to wrap my brain around for some reason... as a print publication it's so flat and static to me, and I never use it.

So when you said - in the comments - that MC is a mediocre YP offering I got really curious.

Why don't *I* see YP as a non-mediocre offering?

Also... do you think that MC has a similar web-centricity as myself and doesn't see what the *true* YP offering is?

Are we missing something?

I know now that I was definitely missing something. Here's Krasilovsky (I added the bold section titles):

Hi Garrett: I am new to SEL, and I like your perspective and writing. I initially found you via Battelle's mention.

The Nature of the Yellow Pages
You are not the first to under-appreciate the Yellow Pages industry. There is a lot to under-appreciate! The Yellow Pages are not very entrepreneurial, they are very expensive to advertise in (although they have a good ROI), and they represent their advertisers, rather than consumers. So they don't include detailed information from non advertisers, which out-number their advertisers by 3:1.

On the Internet, they have been especially slow to develop for a number of reasons. One reason is that their traditional sales people haven't been incented to sell the lower priced, Internet product. This is a typical problem for "incumbent" media, right?

YP: The Largest Local Sales Force Anywhere
But here's what the YP have going for them. They have the largest local sales force anywhere. They can reach into every local business, and they do it for their customers, who have other things to do than spend every day trying to outbid competitors on Google.

The scale of the sales force is unique. Newspapers, by comparison, can only sell the largest local businesses, like retailers, hospitals and car dealers. The national portals and search engines don't even try....that's why Google and Yahoo have set up sales relationships, with very hefty commissions, with as many Yellow Pages companies as possible.

the "Copy Points" Term Defined
The Yellow Pages also have more "copy points," which is the advertiser-supplied information that helps consumers make their "considered" purchase. These include store hours, locations, credit cards accepted, brands and languages spoken. They also provide promotions, such as coupons.

This information cannot be easily replicated by search engines without their cooperation. You can't get it by licensing generic InfoUSA, Axciom or Amacai data. Which is what Merchant Circle and many others are doing.

Advertiser vs. User Copy Points: what YPs Currently Lack
On the Internet, the YPs are "destination" sites, meaning that users go to them because they are attracted by their brand. But they have not really proved technologically adept, and many of the copy points aren't very searchable. They are definitely improving, and are no strangers to search or Web 2.0 concepts, but have a ways to go.

They also haven't committed resources to non-advertiser copy points, and this is a major issue...especially as the search engines and verticals try to get a leg up on local, and are coming up with some of their own valuable "copy points" -- urls, integrated maps, user reviews, ratings..in some cases, even restaurant menus.

Continued YP Usage Due to Poor GYM Scale for Mid-Sized and Smaller Towns
OK, so you don't generally use the Yellow Pages, and neither do my friends. Actually, my wife is the one who uses them in my family. But where did I go when I needed my garage door repaired last month? The Yellow Pages! And I made my selection based on an ad that promised a nearby location, round the clock service, and a AAA discount. I couldn't get that from Google. Not yet.

On the Internet, I would do a structured search for some of these criteria. If I just wanted a phone number for a business, I would use the White Pages.

The review sites will (eventually) give me a good referral for a garage door repair company. But they haven't scaled for my mid-sized town. Yet. And who knows how valid some of those reviews are. They'll get better.

The Race is Still On
In my view, the race is on for the ability to drive the most users, and converge the most relevant of these factors -- and throw in unstructured search at the same time, which does the trick X amount of the time, right?

Google, Yahoo and others aren't kidding themselves in thinking they can do this better than today's Yellow Pages. But the Yellow Pages companies aren't standing still either.

It is a pretty fascinating area, don't you think?

I certainly DO think so, and would like to thank Peter Krasilovsky, whose excellent blog The Local Onliner has just started feeding my BlogLines.
Garrett French - MarketSmart Interactive | permalink | +marktd |