Yellow Pages As A Mirror Of A Market

You can know how much usage there is by the people needing your products and services by studying your Yellow Pages as "a mirror of a market." For that is just what YP is, and it mirrors a market in many ways.

Looking at the Size of "the Mirror"

Yellow Pages mirrors the market by the very size of the directory. That gives you a clear idea about the population covered by the directory. Some directories only have two columns on a page; others have three; most have four; some even have five. In a few cases, they are so large they are split into two alphabetical parts like A through L and M through Z. The directory size also gives you a good comparative idea of how much the ads will cost. Obviously, you would expect a quarter-page ad in the Chicago Yellow Pages to cost considerably more than a quarter-page ad in the Peoria version.

The number and size of the ads in your heading also mirrors the amount of income it produces for advertisers like you. Like any worthwhile advertising, it must make more money for its advertisers than it costs. That means you must have a way to determine how much your Yellow Pages advertising makes and increase or decrease your YP budget accordingly. Most YP advertisers are more concerned with the cost of the ads than they are with the income they are trying to derive from that form of advertising—probably because they haven't figured out how to find out. You don't have to be in that position, as you'll learn below!

How to Calculate Yellow Pages Ad Results

The "100 Checks" Check

To focus on income rather than cost, look at the last 100 checks written by your business or practice. (If you have a huge organization, make it 500 or 1,000.) Separate out all those that produce your profitable income. They will include rent if location is a major factor in drawing customers to your business. They may be checks you wrote for your radio, TV, direct mail, or other types of advertising. If you have a commissioned sales force, they are certainly your commission checks. In truth these income-producing checks were just a relative few out of the 100 checks you wrote. The problem is that they go on the same side of your ledger as all those other checks—the "E" side of the ledger—as an "Expense." That is a leading factor that causes advertising buying decisions based on how much it will cost.

Your income-producing checks should not be treated that way. If your commission "expense" doubles, you'll hardly cut your sales force in half to save money or move to a cheaper location at the danger of losing your bricks-and-mortar customers. Yet Yellow Pages and other advertising expenses often are treated as if they had no consequences, even when they become some of the few ways to actually keep business afloat and create new customers!

So carefully examine the checks that are supposed to produce revenue for you. Only if they are not profitable are they "costs." But if they are doing what they should, ask yourself it they could do even more. Make your buying decisions to produce income, not just to save money.

Look Inside "the Mirror"

Looking inside a YP directory tells more about the market it covers than is told by any other medium. It does so because more businesses and professional practices advertise in their Yellow Pages than any other local medium. Users expect to find all of the businesses and professional practices in their area in their local directory; for the most part they can.

Market Quality and Size

"The mirror" also tells about the quality and size of a market. For instance, West Palm Beach, Florida's "Automobile Dealers—New Cars" heading lists many more names of luxury cars than the same heading in Okeechobee, Florida, just 50 miles to the west. The population numbers are not in control, the market "action" is.

Relative Usage: Who Uses the Directory and for What

What's true of luxury cars may not be true of discount stores and vice versa. "The mirror" tells about the relative usage of each heading in a directory. Most advertisers tend to look at it as the number of people using the directory. A better measurement is the amount of dollars that flow to the advertisers through the heading. The more dollars of income to the advertisers, the more advertisers you will find under a heading and the larger their ads will be. The majority of headings have no display ads. The usual reason is the income produced by those headings does not justify advertisers buying display ads. But there are exceptions. When you find a heading in your field that contains display ads in most other directories, but not locally, that heading probably is underadvertised and you've found a real buying opportunity.

"The Mirror" as Yellow Pages Spending Guide

"The mirror" also tells you how much you should consider spending. There is a reason why the "Attorneys" heading contains full-page and frequently two-page and three-page ads (known as double-trucks and triple-trucks) in directories all across the country. It also tells us that much of the income flowing through that heading goes to personal injury attorneys as they buy more space because of the potential profit compared to others in their profession. (Of course there are some very profitable legal specialties that do not advertise.)

There must be a reason why plumbing contractors and building materials suppliers spend a large amount on Yellow Pages (see Figures 8.1 and 8.2, page 169) and notary publics don't. When you see a lot of money being spent under your heading(s), you know that being selected as frequently as possible from that group can mean much more income for you.

The Exception, Not the Rule

Though "the mirror" says there is money to be made, it does not necessarily mean that Yellow Pages advertising by itself will be the key to your financial success. In most cases your other sources of income are even more or just as important as the income you can get from YP advertising. What it does mean is that a certain portion of your market buys through using the Yellow Pages. You must do your best to find out who those buyers are and how your YP advertising can influence them. Although Yellow Pages cannot produce the same income at the same time as your other sources, your other sources cannot produce the same income at the same time as Yellow Pages! In other words, you can only get those Yellow Pages users through Yellow Pages advertising. Your issues are how much usage there is, whether you want to profit from it, and what you have to do to be "selected" most frequently for the Yellow Pages dollars you spend. The rest of this chapter gives you the keys to the answers.

"The Mirror" as Profit Forecast

To a great extent, "the mirror" tells you how much money there is to be made from a given heading in a given directory. If you are a plumber, an auto insurance agency, or personal injury attorney, the money that is spent under your heading in directories across the country is a clear indication of the value of that heading. At that same time, in practically every business or profession, there are additional sources of income as well. Plumbers frequently get a large amount of business in new construction from general contractors. Real estate firms and auto insurance agencies are location businesses; their physical locations draw in a significant number of customers/clients. Plastic surgeons frequently advertise on TV and in magazines, whereas the big personal injury firms use a wide range of advertising in addition to or instead of Yellow Pages.

Yellow Pages can bring you only a piece of your total market. It is important that you examine the other advertising and marketing methods covered in this book to determine what they, too, can add to your business or professional practice.

Continue reading here: Notes On The Broadcast Fax Checklist

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