While online search engines are cutting into printed phone directories revenues, the yellow page books commanded 13.4 billion searches last year, says the Yellow Pages Association, a directory trade group.

It’s no secret that directory publishers are steadily migrating their directories online and on to other emerging technologies. According to Mike Bierne at Brandweek, AT&T has forged partnerships with “major search engines” and acquired an ad tech firm to get ready for the day when YellowPages.com will convert from charging advertisers a monthly ad fee to charging clients based on the number of calls their ad generates.

But printed directories, the association is saying, is far from dead. According to the YPA, 87 percent of consumers still use print phone directories.

He also suggests making a plan to scale back on your Yellow Pages ads, and gradually diverting your directory budget to online advertising. “It’s headed that way.” Read more.

Each year there’s is a Yellow Pages Race where competitors in each category are encouraged to outspend each other. There is only one winner in this race, and it is not you! Too many advertisers waste their money on Yellow Pages advertising without first considering their marketing strategy. Here are seven ways you can waste your money.

1. Attempting to outspend your competitor
As soon as Yellow Pages has convinced you to increase the prominence of your ad, they get your competitors to match or outbid you. This becomes an annual auction, with some categories containing pages of half and full page ads. A buyer can be overwhelmed with choice and may make their decision before they even get to your ad. Priority in listing is given to those who have advertised the longest in a category for a given ad size. You can only get closer to the front by upsizing your ad or if someone else closer to the front ceases advertising.

2. Putting all your eggs in the Yellow Pages basket
An advertising decision is something you should only make after you have developed a marketing strategy. Many businesses rush into advertising in the Yellow Pages, just because that’s what everyone else does. You don’t become a leader by following the herd. You need to consider your payback for your investment in this marketing channel. Ask your Yellow Pages consultant how many leads a particular size ad generates in your category. Then ask yourself how many of these leads will you convert into sales, and then decide whether this is a good investment.

3. Engaging in destructive Head to Head Competition
When you advertise in the Yellow Pages, not only can potential customers see your ad and your offer, so can your competitors. This can result in price competition that can turn your product or service into a commodity. Yellow Pages make comparison shopping easy for buyers and market research easy for competitors.

4. Spending too much on prominence
When spending on a Yellow Pages ad, you can invest in size and colour. Size is important, but what you put in the ad, your copy, is far more important. It is better to go down a size and spend the money you save on a copywriter. Good copy can generate up to 20 times the response as poor copy. Colour is also important, but not as important as size, so go up a size rather than go to colour, which is expensive for its return. If your category is cluttered with large ads, investing in your copy is essential.

5. Relying on Yellow Pages free design service
Ad design is important. Yellow Pages do offer a free design service, but its worth what you pay. The typical design is done in 15 minutes. As they are designing tens of thousands of ads you can’t really expect any special attention- especially as there is no charge for the service! When they design your ad, they will appeal to your vanity rather than to your customers. So they will put “Joe’s Plumbing” in the headline. But buyers don’t care who Joe is, and are far more interested in why they should use Joe. This requires some marketing analysis of your points of difference and ultimate service benefits, which won’t happen in 15 minutes!

6. Putting your ad in the wrong category
If you are a plumber, the decision of where to place your ad is easy. But if your business is in a fairly specialised market such as oil refinery plumbing, there probably isn’t a good category for you. In fact, for many B2B businesses Yellow Pages is a poor marketing tool. Ask yourself the question, where would a buyer look to find out about your business- it might not even be in the Yellow Pages.

7. Depending on old technology advertising
Every year Internet advertising increases, with less being spent on print advertising. Yellow Pages is now available online and for certain businesses this is a better option, particularly with a link to their website. When being sold paper Yellow Pages ads, you may be offered complimentary online advertising. However, unless your ad is near the front, you will be invisible to buyers who rarely will browse further than three pages. It is also worth paying for a link to your website.

The Yellow Pages consultants are on commission to sell you advertising. They only interested in getting you to spend as much as possible, not on providing the best marketing solution for your business. Advertising is not the same as marketing! Good marketing advice on whether and how you should advertise is money well spent. Not only can this increase sales, but it can save you thousands of dollars in advertising.

Before making a decision on Yellow Pages advertising, you should consider all your marketing channels, and make decisions on how much you invest in each dependent on their ability to attract leads. Having determined how much you will invest in Yellow Pages, do some market analysis and invest in your ad copy. This is particularly important for larger ad sizes. Yellow Pages advertising can be rewarding, but should only be considered as just one part of your overall marketing strategy.

Dr Greg Chapman assists small to medium sized businesses with business planning, business systems and marketing strategy. For a free “Online Business Medical Checkup,” visit his Empower Business Solutions website.

“There continue to be challenges with this business,” said Signal Hill analyst Maurice McKenzie. “My sense is that trumped the dividend.”

Ad sales were dragged down by the Florida and Nevada markets, which are suffering acutely from the housing slump. Ad sales in those two states were down 7 percent, CEO David Swanson said during a conference call with analysts. Sales in the other 26 states where the company publishes directories fell “just over a percent.” Donnelley’s revenue in the third quarter totaled $669.9 million, up only slightly from a year ago. Cash flow from operations totaled $156 million, down from $161.9 million a year ago. Donnelley reaffirmed its guidance for the year. That includes a projection that ad sales will range between flat and 1 percent growth.

“We remain optimistic that the yellow pages business is a valuable, long-term business,” McKenzie said. “We are encouraged by the actions the company has taken, over the past year or so, in terms of strengthening its position online, which we see as a critical growth engine going forward.”

Well, the furor has died down a little in past years, but it’s still one of the largest and toughest Yellow Pages categories in which to advertise. Which is why I’ve always recommended“The Lawyer’s Guide to Effective Yellow Pages Advertising” by Kerry Randall and Andru J. Johnson to my attorney clients. The always-entertaining directory ad pundit Richard Larkin says “Following the principles and exercises in this book will result in ads that generate more calls from the right types of clients, and will almost certainly give any lawyer a significant advantage over the competition. Any lawyer who advertises in the Yellow Pages without following the steps outlined in this book is taking a huge gamble with his or her money. A yellow Pages ad developed using the principles in this book will likely generate many thousands of dollars more revenue than one created by the directory publisher.”

This book is essential for law firms that advertise in the Yellow Pages because it clearly explains how to plan and design a more effective, targeted Yellow Pages ad campaign; one that attracts the type of clients the firm is looking for, one that stands out among competing ads, yet still follows the pertinent ethics standards for attorney advertising.

“Is the lowest price REALLY the most important thing that you’re looking for?”

If they say “Yes, I’m looking for the lowest price,” Steve advises that you simply give them your price and let them handle it from there.

Of course, you should be sure to give them all the BENEFITS of doing business with you before you tell ‘em the price, and I agree. If you were a videographer, for example, this is where you’d give them your number of years in business, the number of happy couples that have used you to capture their wedding in flawless detail, the number of companies and businesses that have found you to be a reliable, no-hassle resource for taping their meetings and seminars…you get the idea. Talk about the benefits of doing business with you…then give them a price.

If, on the other hand, if they say, “Well, price IS important but we’re looking for someone who can do a good job for us…” Bingo! There’s your lead-in. There’s where you start solving their problem and establishing all the benefits that your skills bring to the table!

In most towns and cities, you receive at least two telephone books. Lucky you! Well, one directory will always be from your “carrier” –Ameritech or Southwest Bell or any of the other AT&T units that spun off from the Bell System and now, like a puddle of mercury in a corner, are coming back together. Your carrier is…well, the carrier, or provider, of your local land-line telephone service. The other books will be from one or more “independent providers” of the phone book in your area. Should you advertise in both? Well, if there were two roads running through your town, would you have a billboard on one road? Or both? “Both” is the right answer, of course. Within reason.

The good news is the ads don’t have to be the same size. We always ran a dollar bill size ad in our carrier’s Yellow Pages. And we ran an ad one-third that size in the competitor’s Yellow Pages directory, even though current readership surveys here suggested that each book commands about 50 percent of the population that uses Yellow Pages.

The reason for the disparity in sizes is simple. We always had the biggest ad in the Ameritech book, and we were the ONLY display advertiser in the competitor’s book, so we were -by default, almost -already the largest advertiser in booth directories.

Our strategy was to keep those ads running as is until one of our competitors got close (or equal) to those existing sizes, and then –and ONLY then –would we jump up in size just enough to make sure our ad REMAINED the largest.

Another thing we did was track our ads to see which book was most effective for us. I’ll tell you how we did that in my next post.

Questions? Comments?

Here are a couple of ads from competing companies. The single color ad on the left has a good, strong illustration, clean layout, big phone number. But look at the one on the right. Which one gets your attention faster?

(To digress for a moment, I also like that “protection…since 1850″ headline in the right-hand ad; it plays right into the “Security” part of the RASCIL factors, doesn’t it? In fact, take a moment to look at the small print and see how well they’ve followed our formula for a successful ad!

Okay. Back to color.You don’t need a LOT of colors just for the sake of adding colors; you only need enough to set you apart from everyone else. If someone’s running a black type only ad, use black and one color and you’re already ahead of the competition.

And here’s a little known fact for you: yellow pages aren’t really printed on yellow paper. It’s far more economical to print phone directories on white paper stock, and then use yellow ink to print the background color, and black ink to print the ads themselves. For years, having a yellow ad background was your only available choice but lately, most phone books have offered “white reverse” ad backgrounds, where your ad can feature a non-yellow background. This is another inexpensive trick to improving your ad readership.

The second thing that will aid readership is free: do something tricky with your border! Don’t just have the Yellow Pages ad people just run a thin line around the ad and call it done. Have the make it look like a length of rope, if you’re a marina; incorporate your artwork into it; do something that takes it out of the norm. Your ad should be as eye-catching as possible! Since the help is free, ask your sales rep for help in design and even in writing –as long as you remember the sure selling phrases that we’ve already discussed.

At any rate, the point here -and it’s a big one regardless of whatever medium you’re using to promote your services or products…

Talk to your audience on their level, not yours.

Above all, remember who your audience is. For instance, people who purchase video services are for the most part non-technical users of video.  I feel a pang of pity for the poor misguided video guys who waste their precious Yellow Pages space with phrases like:

• Betacam SP A/B Roll SMPTE Time Code, or…

• PAL-M, SECAM transferred to NTSC 3.58

What’s better? Phrases people can understand! Words like these:

• Affordable corporate, industrial video.
• We write, shoot, direct, edit and duplicate professional videos
• We specialize in weddings and receptions
• Depositions, Live Seminars
• Video duplication
• We transfer film and slides to DVD

Get the point? Unless you’re a professional supplier to a certain industry, and they’ll be reading your ads and making a decision to do business with you -eschew obfuscation.

Okay. I just threw that in to complicate things. Just a little example. What I mean, of course, is keep it simple. If you don’t, the majority of people won’t understand what you’re talking about. They’ll go elsewhere, looking for someone to whom they can better relate.