Our future is paper, not digital

It’s an interesting life, spending my days in the computer department of a Yellow Pages publisher, while my evenings and weekends are taken up with preparing for a lower-resource lifestyle that the end of cheap energy will bring us.  That’s a dichotomy that took a while to come to terms with; I love technology, enjoy working in the digital and mobile realms, and have invested significantly in my I.T. and Management skills, yet my vision of the future is a world that is lower energy, lower resources and considerable less affluent than the one we inhabit today.

Nothing has highlighted this conflict of expectations as much as the planning for new digital products. Currently there is significant demand for digital - in fact it’s the biggest objection our sales force hears when selling Yellow Pages – “I don’t need to be in the book, I am on the internet!”  Recently we ran a series of training course for our sales people, so they can explain better to our customers the value of print over digital, why those customers are seeing a lack of returns on their digital products, and a number of digital fallacies with the “adwords” model which I highlighted almost two years ago on this blog.

Our salespeople were very surprised at how poorly Google Adwords perform; by using Google's own tools, teaching them the Google keyword finder, they know how to calculate how much each it costs the advertiser each time the internet sends a customer their way.  We’re training our staff to impart that knowledge to our advertisers, because we want the businesses in our local communities to be informed consumers of advertising services, and that means giving them the tools to determine for themselves the return-on-investment for each advertising dollar.

so far our digital products to date have been very limited.  For an extra ten percent of the cost of the printed directory adverts, we can replicate the print advertising package online, and in our mobile app.  If that seems cheap –and it is –it reflects how much value we place on digital – worth perhaps a tenth of what the same exposure is worth in the books we deliver to all the households in a community.  Since we do not have a national presence, we have a local customer base around 5% of that of national yellow pages brands, we don't always score on the first page of Google's results. 

So how do we deliver value compared to them?  If the advertiser has a website, another link with the same name, address and phone number (NAT) increases the confidence Google has in their web site being "trusted".  I also suspect, from patterns in the data, that myyp.com has a lot of business people visiting it, perhaps up to a third of the traffic being B2B.

We regularly look at other digital products. Web sites are an obvious example, with many Yellow Pages publishers selling web sites, SEO services and other digital media, often from a third party.  Vanity mobile applications for businesses, and interactive ones that allow appointment setting, billing and a host of other services between consumer and business, have caught our eye.

So far, nothing has convinced us that it's a good enough value for the consumer, the advertiser, or ourselves, to adopt more than one product: SMS messaging. What I like about this is the level of technology required to support it: it works on the older "flip" style phones and will work on the older models that supported text messaging, even those limited to twitter-length messages.   

I like it because it is resilient for an electronic product.  It can work on a large number of phone platforms, including ones we made when there was still technology manufacturing in the United States. Even an eighties car phone, complete with brick battery, could receive the marketing blast with the addition of a "modem" of the same era.

Am I disappointed we won’t get to play with the latest and greatest digital products? Perhaps a little.  I still think there is time for a mobile application that helps refocus the consumer on his or her local community, reward local loyalty behavior in shopping patterns, and provide alternatives to the dollars hemorrhaging from our communities to Wall Street via the big, publically traded corporations. Products like punchcard are already a long way down the road, and I’ll be posting my predictions on what any “game-changing” application might look like soon.

Products and services are not the only area where technology meets the advertising world.  Our techs and programmers have their hands full making sure we are helping our sales force provide the best value-for-money we can, to design, test and deploy the systems that keep errors to a minimum, streamline the gathering and presentation so those customers can make informed choices, and deliver those choices to a still-loyal consumer base.

In the last few years we have taken our sales system electronic, deployed mobile internet access for salespeople on the road, and just last year we even gave our sale force smart phones.  Tablets are under consideration and who knows, the challenges of managing a few hundred iPads, Android tablets or Windows 8 slates may be in our future.  They will be used to sell a product that has changed little in over a century, and having stood the test of time will still be bringing value to advertisers when our grandchildren are coping with a world defined by resource depletion.

Call Tracking – when Yellow Pages techniques go bad

One of my recent projects revolves around remote call forwarding numbers. With the implementation of state-or-the-art sales software, we are looking at how we can also improve other services including the tracking of calls to our advertisers.  The most common way of doing so is to use a “call tracking number” - also called a Remote Call Forwarding (RCF) – that’s where a telephone number in the book is different number from the regular business number.  You call the 559-555-1234 printed in the Buy Local Guide, and behind the scenes the number forwards to 559-555-3912 – the front desk or Mr. Advertiser.

When the phone ringing or the door opening was the only way a customer got in touch, this model worked very well.  Though the use of the RCF we show how Yellow Pages advertising outperforms other traditional media, and also produces returns that are an order of magnitude above what digital products can deliver today.  However, the concept of an RCF number introduces problems when the advertiser is heavily invested in digital advertising.

While automation and computerization makes life easier and allows larger and larger amounts of data to be sifted, processed and cataloged, it does introduce flaws in those arenas where a computer does badly, like making intuitive jumps when two telephone numbers don’t match but the name, address, storefront, products, services –even the person smiling as they sell you a widget –are the same.  We can figure out they are the same business.

Computers cannot make such a leap of logic - even the really big ones at Google, Bing and Yahoo.   Search engines are not perfect, they are Frankenstein creations, with generation after generation building upon the successes and presumptions of their predecessors. They have to deal with diverse human languages developed over millennia, with local phrasings and idiosyncrasies, and the messy way we humans label things.

So when a local business has an RCF number printed in the Yellow Pages directory, what happens?  How does this RCF affect their online presence and ability to be found on Google?  Does it matter?

The answer is yes, and the impact can be very negative, particularly the ability of the advertiser to be found in the organic search engine results pages (SERPS).  Google is very clear that the most important common metric for local search is the NAP.  

Name.  

Address.  

Phone number.  

Linked together, this string of vital data about your business is a “key” – that is a unique reference that search engines use to put together all the info they have on the business.  The more consistent the information is, the better a business shows up for a relevant search.  In other words it adds to the pages “Page Rank”.  Add different, confusing data such as a different telephone number, particularly in a directory that is generally a “trusted source” due to having tens of thousands of correct numbers listed, and the damage could be considerable.

Even if the RCF number is complete new and not already in the Google database from being assigned to a different advertiser a couple of years ago, that new NAP-combination will create issues. With a few weeks of publication that telephone directory is keyed by data services, such as InfoGroup, Axciom or Localeze and distributed to many places, including Google and other Yellow Pages companies.     

Within weeks it is possible that the new RCF number will manage to confuse and confound one of the biggest corporations on the planet – Google.  To be more precise, it may have created almost-duplicate content in the database and when Mr. Consumer is looking for a widget provider, Google sees two telephone numbers for this business and it is not sure if it is looking at one or two different widget providers.

Google does not like what it perceives as duplicates (a method subject to great abuse in the SEO world) so it lists you lower down on the results page than the widget-provider across town, who never used an RCF number.

What can you do?

If most of your business comes from people walking though the door or from local customers, calling you, or responding to coupons in your local media, then this problem is not going to be that big a deal for you.  If you are based in a brick-and-mortar business, you customers are your neighbors, then I recommend spend your advertising dollars where they work - in a local delivered and distributed product.  Yellow pages are best (I'm biased) but I’d encourage you to support local newspapers and local radio.  If your customers are local, so should your advertising.  The potential loss from Google listing you twice is negligible when compared to knowing exactly which advert content generated the best results for your business.  

If your business is internet based and the majority of your customers are mail and internet-order, then you probably don’t want to use RCF numbers at all.  It’s when you fall between the two, serving a local market but spending a lot of your advertising dollars online, that is when it is going to be harder to use RCF’s effectively and without some negative impact. Here are some ideas.

One technique you may try is to use a slightly different name in your NAP, one that is associated with the call forwarding number but not with the normal business NAP and are less likely to end up in your local cluster. It means trying to juggle two sets of Google local data, and there’s no guarantee that algorithm changes designed to catch people duplicating listings for nefarious purposes won’t penalize these techniques in the future.  

It’s possible to display the correct NAP (original desired combination of Name, Address and Phone number) whenever the browser detects a GoogleBot or a BingBot, and the RCF number only when it’s a browser viewing the data. If you use RCF numbers internally, make sure your web master knows you are using forwarding numbers.

There are no easy solutions to this predicament.  The providers of RCF numbers need to address the issue of how it may impact the advertisers ongoing SEO efforts.  Unless they do so quickly, then the internet-based advertising companies, with no loyalty to the local communities, will dominate the conversation.  Sadly, it is in their interest to undermine the use of RCF on the basis of "it will mess up your internet advertising".  The last thing a company trying to sell you adwords wants you to have is research that shows just how much better the ROI is on local advertising.

The dreams the internet vendors sell are in the clouds, whereas the leads Yellow Pages creates are in your local community.

Setting a positive example for our communities.

After a few months of major projects, mainly the deployment of a new digital platform for our sales force, I finally have time to write part two.  In this post, I look at the options for local businesses trying to survive in an increasingly digital world.  Day after day, they are bombarded with the idea that everything has gone digital, everything and everyone is on the internet.  "The future is digital," they are told.

In fact, one of the more common objections a Yellow Pages advertising consultant hears is, “I don’t need to advertise in the Yellow Pages, I am on the internet.”

I’d agree with the second half that statement. I’ll even concede that many of their customers are also on the internet.  But the more important question is, how much trade does that business do via their online website, compared to the paying customers who pick up the phone and call, or simply walk through the door?

If your customers are not coming to you via the internet, is the internet the best place to chase those customers?  Can you afford to compete with an out-of-state internet giant, who leverage their size to beat any possible price?

Would you even want your relationships with your co-workers to be competitive, each pushing themselves harder to meet impossible targets? A warehouse of conveyors, with human picking machines running to meet a timetable. That's not the heart of the American business community. It's not the business model that built your community.

If your customers are local, if your business serves your local community, if your success relies on the people who live within easy travelling distance from your place business, then surely your advertising should address those people first? Local advertising provides results for local businesses.

Now the Yellow Pages are not the only local media in (your) town.  For brand and name recognition, a local radio station or outdoor billboards can help build your image.  For specific sales events, special promotions, or to take advantage of a particular season, radio and local newspapers are great ways of helping a potential customer consider what you have on offer.  Direct mail is another option, but the results are generally as poor as internet-only advertising, with a 2% - 3% doing the old-fashioned version of a “clicking though” – actually reading the mailing piece.

Yellow Pages should be a key part of a local advertising strategy because it’s there when the consumer wants it. A person reaching for the Yellow Pages is a person in your local community, who is most likely ready to make a purchase. That's supporting the community I can get behind! 

That’s not to say the internet does not have a part to play when it comes to buying locally.  Many of your customers may go online and research before they buy.  Today, many business owners and workers deal with consumers who are much more knowledgeable about the products they want.  But research does not replace holding an item in your hand; the internet does not give a feel to the level of quality of an item.  Most importantly, internet retailers only give people what they ask for.  They lack that face-to-face communication where you find out what they actually need. That human element, that connection local businesses have with their community, is worth preserving.

This election season, much politics is being made over “who built it” but the political wrangling is missing the point.  People in your community built it.  People in your community built the infrastructure.  People in your community built the businesses.  Most importantly, people in your community can build a better future when the money in your community, flows though the businesses, the workers, the shoppers in that community.   

Regardless of whether peak oil results in a much lower-energy world, or technology comes to our rescue and we move forward into a techno-utopia, the relationship between local community and local business will be vital.  Far worse than the vision of a post-carbon world, where local businesses are once again selling, repairing and supporting locally produced goods; is the dystopian vision of  a million small businesses, all trying to beat each other with ever lower online prices, while the remaining good jobs disappear out of their communities, in the frantic race to the bottom.  

Whatever the future holds, the success of our local communities will depend on the local leadership, of the local businesses, in those local communities. Local businesses have local options.  Yellow Pages online is an important part of a strategy, not a replacement.  Local radio, local newspapers, local advertising agencies that can help with your marketing plans.

Most importantly, make sure your customers know you support the buy local campaign. 

Symbiotic versus parasitic businesses

The life style westerners have enjoyed these last few decades is unique in human history.  Never before has every fruit and vegetable been available in our stores throughout the year. In no previous age have the merchants catered to the whims of the populace rather than to the whims of just a select few.  We have shared in the riches of a century of cheap, portable energy. It’s been great.  But I fear the party may be coming to a close.  With supply at a plateau and demand from developing nations climbing, soon we are going to be in an international bidding war for oil.

The energy supply is going to get vastly more expensive as supply fails to keep up with demand.  That will put an upward pressure on transportation costs, making distance from supplier to seller to consumer a far more significant factor.  The big internet retailers are dependent on that cheap energy to get their goods from centralized depots to consumer’s front doors.  Costs also depend on volume, which will decline as spending falls, and result in more and more jobs lost in the inevitable demand destruction.

As the cost of transport gets more expensive, the traditional model of local retailers serving the community will come back to the fore.  When it costs the consumer more to ship from out of state, despite the tax advantages internet retailers enjoy, expect to see more people searching for what they want back on the Main street.

Communities are defined by how far you can travel in a reasonable time. Not that long ago, it took as long to travel from village to village as it does today to travel continents –all because of cheap energy.  As long-distance travel becomes less of an everyday activity, our interests will, for the most part, become more localized. Localization is both a symptom and a solution to the predicament of declining energy supplies.

Now before I extol the virtues of adopting the ‘buy local’ lifestyle, I’d first like to talk about those internet retailers. When I buy from a local business, a reasonable portion of that money continues to circulate around my community.  Even the big box retailers contribute some money back to the community though the wages spent locally by their employees.

The business community has always shared a symbiotic relationship with the consumer.  The health of our community is dependent on the ‘velocity of money’ –the transactions from person to person that earns us our daily bread.  Our employees live and work in the community that supports our businesses, and the lives of our employees are intertwined with our customers.  We enjoy a symbiosis that goes back to the earliest days of barter and the marketplace.

The large, internet-only retailers, in an ecological sense, are parasites.  They contribute little or nothing back to the local communities beyond the wages of the occasional delivery driver. They suck money out of local economies into the stock market. In a world of digital money, we may not see that green river flowing out of our communities and into those nebulous ‘markets’.  If I could believe in the paradigm of infinite growth, I would not find this a bad thing.  Our pensions, our 401K funds, and our other investments rely on the markets.

But in a world constrained by energy limits, where the impact of oil shocks threatens economic security, there is competition between the needs of Main Street and the desires of the giant conglomerates who are able to take advantage of energy to grow to a size that can push smaller, local retailers out of the marketplace.

In many ways it is a private sector reflection of the political decisions of the last few years to protect ‘Wall Street’ rather than ‘Main Street’. The concentration of wealth in giant corporations like Amazon, the growth of giant multinational corporations, all reflect the growth of big government. 

Power often concentrates in an individual, politically, that may be in the form of a President or a King. In business, it may take the form of the legal fiction of a corporate person.  It represents the oldest form of social order, monarchy. Today, we see the scale that is possible when there is an almost unlimited amount of energy available.

When we talk about our communities being drained of money, how can we define community?  At a city level? At a county level? How about at a state level?

How about you, the consumer, deciding what constitutes your community?

Actually, you already have.  You, and everyone in your community for the last century or more, have defined what community is by your shopping patterns.  It’s how far you are willing to travel to purchase the goods and services you need.  That model has existed for centuries, people shopping where they live and work.  We almost lost that model of local people spending money in local shops, the drive for lowest possible price before any cost threw a lot of small businesses under the bus.  Again, this is a result of cheap energy that subsidizes the cost of doing business for companies with no investment locally.

Luckily, we still have a legacy of the older shopping patterns before the parasites came along.  It’s called a telephone directory. Businesses buy advertising in directories that serve their customers. The majority of businesses in your local directory only advertise in that one directory – you, not the million on the internet, are their market. The Yellow Pages have been in a symbiotic relationship with you since your parents started shopping for your nursery.

The changing energy costs will affect our industry as much as every other. As transportation costs rise, I expect directories to fragment; a rural directory today that may have three medium-sized communities within its pages, may in the future, be replaced by three smaller directories.  If the consumer travels less frequently to shop, then the value of advertising over a wider area will drop.

The Yellow Pages is all about competition. They show businesses competing for the money moving through their local community.  Yellow Pages shows merchants side by side, letting the consumer choose with whom they wish to speak..  At the same time, we advise businesses on how best to convey their strengths through their advertising. As such, local directories are a reflection of the health of the community; a strong, vibrant business community is a healthy customer base for Yellow Pages companies. We only succeed when our local communities succeed.

In the aftermath of the Great Recession, it is far too easy to open the Better Book and blame our woes on our competitor down the street.  Yet if that were so, what explains the blight in our communities?  If we lost our revenue to our local competitors, the money would still be circulating between paycheck and till receipts.  We’d tighten our belts as our customers did likewise, and adjust to the ever-evolving marketplace. Some uncompetitive businesses would not survive, and a new equilibrium would be achieved.  Businesses have gone through this cycle a myriad of times.

Shoppers are not tightening their belts.  Instead they are changing their shopping habits. The online retailers have the advantage of not having to support the local community. They employ no one locally.  They often avoid taxes by incorporating elsewhere. They appear to provide great value to the consumer who feels the pressure in his or her pocket because there is less money flowing though the community. Yes, it’s the same argument used against big-box stores; except even if those stores were to become the only game in town, it would reach some equilibrium within the community it served.  Not so with the internet corporations.

The relationship between consumer and merchant, on a local scale, is always symbiotic. Not so for the internet parasites. They survive by feeding off local communities and profit by giving nothing back.

Next post, I will suggest ideas on how local companies can survive until the inevitable increase of energy costs levels the playing field and brings the focus back where it belongs, in our communities.

Spam, spam, spam spam....

I don’t get to blog often these days, my writing exploits have taken a different turn. My first short story, "Caravan of Hopes", will be out in an anthology of stories regarding peak oil this fall.

But my career is still firmly centered in advertising, and the Yellow Pages industry in particular.  Today, I’m going to rant about spam, and the lack of anyone out there actually dealing with the problem.  All the current anti-spam packages do is treat the symptoms, and make a lot of money in the process.

Don’t get me wrong, I find our spam filtering device invaluable.  The number of spam emails I get at work is minimal.  It’s not the same at home, though, where I often wade, digitally speaking, though far more spam than real email.  I’ve seen statistics saying 90% of email today is spam.

That’s one hell of a signal to noise ratio.  90% of the clicks in my inbox are a waste of my resources.  In my opinion, however, the answer to the problem is not stopping spam, it’s increasing the noise to signal ratio for advertisers using spam.

Currently, there are enough people who click-through spam, then buy something, to give an advertiser a reason to continue junk mailing our inboxes.  For every few million email messages sent, a few suckers fall prey, and an advertiser pays for a ‘business lead.”

But what if the click-throughs were not from real people, just like the spam you get is not really your uncle Joe emailing you with an offer you can’t refuse?  What if we could increase the signal-to-noise ratio for the advertiser?  They would be paying the spammer for traffic that generates no revenue.  In a perverse twist on ‘click-fraud’, the spammers would see an immediate increase in revenue, followed by a collapse of the market and possible lawsuits.

Obviously, I don’t want to click on every spam I receive just to help the advertiser waste their money.  I’m sure neither do any of my readers. What I want is an anti-spam package that identifies (automatically or via ‘mark as spam’) unwanted email, forwards it to a server, where an automated program (a spider) can follow the links in a manner that is indistinguishable from a human clicking on the link.   

To maintain click value, spammers would have to start avoiding email addresses that triggered wasteful traffic. Alternatively, they would have to drop the value of the traffic as the conversion rate plummets, reducing the effectiveness of the advertising model.  

Signal to noise.  I want to turn the tables from the ‘noise’ being my problem to the ‘noise’ being the advertiser’s problem. I want to see their costs for sending unsolicited email to go up while their conversions go down.  Companies who hire spammers don’t care about potential customers or they would not alienate the majority of them, in the hope that there are enough suckers to make it worth their while. Make them pay for the spam in your inbox with no hope of a conversion.

Of course, I’d also like to be able to mark commercial emails as ‘not spam for me’ if I do, indeed, have a reason to hear from an advertiser.  I want to encourage responsible use of email as a marketing and communication medium between businesses and customers. 

Now that’s an anti-spam product that I would be more than happy to pay an annual fee for.   

I like to have as much control as possible over what advertising that enters my life. That’s why I no longer watch TV; I use the internet to stay current with events. It’s also why I like working in the Yellow Pages industry.  The yellow pages are there when I need to buy something and sit quietly on top of my refrigerator for the rest of the year.  I also know that every business I find in there is invested in my local community, not some scam from the other side of the world. Yellow pages builds trust like no other medium.

For those of you who came here expecting a Monty Python reference, here you go:

2012 is here

My apologies for not posting for a while. Family matters have taken up a lot of my attention, with my wife taking a work contract in Europe and the kids staying here in Calfironia with me.

I will be resuming my posting on Peak Oil and the impacts it is having on Local Search, particularly Yellow Pages, soon. 

No post this week

In the last two weeks I have attended two conferences, spend a week in the UK, and lost one of my best friends and our best man to a sudden heart attack. Normal service will be resumed in two weeks.