I recently spent some time at the offices of HomePages, a DeKalb, Illinois-based independent publisher that has been quietly and steadily growing by producing very simple print Yellow Pages directories amid all the talk of market consolidation and the shift to online and performance-based advertising.
HomePages produces more than 200 directory titles throughout the Midwest, with the largest print run at 40,000, and the smallest a mere 2,800 copies. The books are printed in one column, and the advertising rate card fits on a single piece of paper, printed on both sides. Ad rates are very low; a full-page ad can often be purchased for less than $1,000.
And yet the company has been putting up double-digit annual growth rates year on year, and will grow solidly in 2009, albeit a bit more slowly due to the economy.
I sat with CEO Abe Andrzejewski and EVP/Sales Dick Larkin to get another perspective on what is working in traditional directory publishing today. Certainly among larger companies the news has not improved. We’ve seen two major publishers enter bankruptcy this year and so far, the 1H 2009 financial results give few hints that the staggering losses in print are stabilizing.
Why It Works
Andrzejewski points to a few factors in his company’s success, and none has much to do with technology. HomePages is an Immersifind IYP customer, but it has just gotten started selling online advertising. The company is still highly print-centric.The first success factor is the company’s “hyperlocal” distribution.
As noted, the books are scoped to small communities and the largest title has only 40,000 copies. By going so local the company is able to offer small advertisers the ability to target only local customers, and consumers will know the books give them only very local businesses to choose from. While there is a range of book sizes, Andrzejewski says the distribution “sweet spot” is around 14,000 copies.
A very low price point is the next factor. This may seem obvious but this enables HomePages to have a segment of the market all to itself, more or less. About one-third of HomePages accounts do not advertise anywhere else. Related to this is simplicity — there are only a few ad items and all ads are display ads. SMBs are not driven away by the paradox of choice at HomePages.
Andrzejewski and Larkin are aware of the push for performance-based advertising, but they don’t see it happening in their books any time soon. Larkin argues that while PFP seems logical, very small advertisers cannot overcome the psychological hurdles around PFP, such as fear of open-ended commitments or doubts about the quality of calls. While these are issues that can be addressed in how a program is developed, the HomePages team doesn’t see the need, given its small book, small market, small price point approach.
Agree or disagree, it’s useful to hear a perspective on new pricing models from those actually out touching SMB advertisers. Andrzejewski does acknowledge that interest in PFP varies by market. “There is more appetite for accountability in bigger, more sophisticated markets.”
Andrzejewski will share some of his ideas on print success on a panel at the upcoming BIA/Kelsey Directional Media Strategies conference in Orlando, Florida.
Print Yellow Pages 2013: Critical Changes to the Core Product
Day 3, Thursday Sept. 4, 10:30 am - 11:15 am
A diverse group of thinkers will weigh in on the future of print directories, and offer a snapshot of how the core product will evolve to stand out in an increasingly competitive media environment.
Abe Andrzejewski, CEO, American Marketing & Publishing LLC / HomePages Directories
Peter Huber, Director, New Business Development & Product Management PRINT/CD, Herold Business Information (European Directories)
Michelle Sherwood, General Marketing Manager, Sensis