Yellow Pages Facing $5B Loss in Next 5 Years

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Print yellow page directories may suffer a near-fatal blow in the next five years, losing as much as 39 percent of annual revenues.

That amounts to a loss of $5 billion in annual revenue by 2013, according to a new report from Borrell Associates.

Simultaneously, there will be an increase in search engine advertising and local online video. This will give publishers a larger cache of advertising products to sell, with video showing the most promise as it grows from a $1.4 billion category this year to $7.6 billion in 2013.

In fact, with 14 percent of gross revenues coming from online sales this year, yellow pages publishers have been the most successful of all local media companies in moving to the internet. Other local media companies like newspapers, radio, TV and cable pull less than 5 percent of revenues from the web.

One important element in the strategy of directory publishers is their sales forces. Borrell points out (via MediaPost) that yellow pages publishers have spent the past three years shifting their on-the-ground sales forces into “marketing consultants who can meet their customers’ demands both in print and online.”

About 80 percent of the 14,600 print directory sales reps are actively selling online, compared to just 35 percent of newspapers’ 31,900-strong sales force.