The effectiveness of phonebook ads versus the internet
Archived commentary from October 11, 2010

In a survey done by Gallup for SuperMedia (the people that run the phone books for Verizon), it's been shown that the number of people using the white pages dropped from 25% to just 11% of all households. They will be ending delivery of the white pages unless you request it.

I read this with interest because it reminded me of our recent experience with the Yellow Pages advertising. We had an ad in the Yellow Pages as long as I can remember. 20 or so years ago the usual annual increases started getting out of hand and we reduced the size of our ad from something like a 1/10th-page size to a single column 2" tall ad.

Things went along fine for a while but then the increases became ridiculous. Every time renewal came up there would be charts and info claiming how everyone used the Yellow Pages. As the Internet grew in the 90s I could see from the server referral stats that more and more people were finding us through search engines. All this was in the pre-google days too. I would ask new customers how they found us and over the past 10 years (2000-2010) the number who use the Yellow Pages as a source has dropped to zero.

The straw that broke this camel's back was this past year they (SuperMedia) would no longer contact us at renewal time. We received a letter informing us of the new (higher) price and that unless we contacted them it would automatically go into effect for another year. They would only give us 5 days notice. Not a good way to retain customer trust and loyalty especially since this was added to your phone bill and if you didn't pay that bill you would face penalties or have service cut off. I was pretty annoyed so I called them up and canceled the ad until a representative would contact us about options. They never did. I have to note that the ad design was our all our own work. I wasn't the only one either. When I compared that year's book to one from a few years later many shops had pulled their ads as well. Phone books may still be vital for large companies with higher profit margins and a wide market area but small shops serving people within a several-mile radius have to rethink things. I look at the big ads and wonder how much the prices are raised to cover an ad with such limited market penetration.

Where do new customers come from? Outside of word of mouth and a large storefront sign the big dog is by far Google. Bing and Yahoo! are next. Far behind are the default ISP search engines (Comcast, etc.) and those are powered by one of the larger search engines anyway. With the growth in smartphone use, younger customers are finding us that way. I could see now how people using smartphones to do local searches as they are out and about. They do quick short keyword searches, often something like "bakery, cake, zip code" and then they get a very basic search result list with the closest shops. That is the new target customer block for business.

So what to do if you run a small business? Phonebook ads will become ever more expensive and fewer and fewer bakeries (and customers) use them. Customers will break down into 2 basic groups. The first wants as much detail and info as possible as they research specialty products like party and wedding cakes. The second are those looking to find your phone # quickly from home or on the go so for them even the most basic website is a must.

As small bakers, we can either continue to shell out absurdly high phone book ad rates and pass that along to our customers or leave the horse and buggy days behind and embrace newer and vastly more cost-effective ways of reaching out to those looking for us. I'm betting our customers will appreciate my efforts to save them money.

Update Winter 2014:
I was showing another local business without a website how people search for him using a smartphone. A simple touch on the screen and the user speaks the keywords into the phone and up pops the results on the screen. If you don't have some basic listing somewhere you don't show up. We now get calls for other businesses in Mayfair that don't have a website because we come up #1 in the results. That's not always as good as it sounds when they call us up for unrelated items like rock salt in when sleet is coming down outside! A basic website is $4 a month plus $12 or so for the name each year. A lot cheaper than a phone book ad.