But overcoming these hurdles is simply a matter of time. Obviously, Google feels the time is close at hand, and they're busy hammering nails in the coffin of the Yellow Page industry. The discrete announcement from the Yellow Pages Group about the Google deal indicates that they're very aware that the writing is on the wall. The Yellow Pages have been diagnosed with a terminal case of obsolescence. The world is quickly passing the industry by.

Why Local Search Makes Sense

Using the web to find local businesses makes a lot of sense. Once you find the business, you can interact with it to the full capacity of the web. You can access reams of information, browse catalogues, book appointments, ask questions, see interactive demos, get a map of the location or even purchase online. It's tough to do all that with a Yellow Pages ad.

Look at 3 examples of the top yellow page advertisers, lawyers, pizza shops and appliance repair shops. On the law firms website you can read the bio of the lawyer who handles the practice area, discover more about the firm, and perhaps even submit a question or two. You can also schedule a consultation visit. With the appliance repair shop, you can read a troubleshooting guide, make sure they repair your brand & model, and even search to see if they have the necessary parts in stock. And with the pizza joint, you can shop, pick your pizza, place your order and wait to have it delivered..all with a few clicks. Sorry Yellow Pages, you just can't hope to compete with the advantages of the Internet.

Finally, the Yellow Pages are restricted to predefined industry categories. If you're not sure what industry to look up, you won't be able to find the advertiser. Search is keyword based. Type in a product or a model number, and search will take you to the right vendors. This offers significant advantages for the user and the advertiser.

Local Businesses Still Have to Get Serious about Online

Of course, to make local work, local businesses have to fully tap the potential of the Internet and create a rich online experience for users. This has never been a priority before, but it will be in the next few years. When the internet becomes ubiquitous local businesses will have to pay much more attention to it as a marketing and customer communication tool. The Internet, or its next evolution, will become an essential part of our day to day lives. We won't be able to live without it. The lines between the real world and the virtual world will blur dramatically. It will be imperative for every business to gain a presence in that virtual world. That means a lot of business for local web designers, both in designing websites and revamping current brochureware sites.

The Local Boom in Search

The second part of the boom comes when companies who never cared about search realize it's suddenly very important to capture a top 10 ranking in their local market. At this point, the same rules apply for ranking relevancy on Google Local as on the main Google index. Google still wants the best sites, as determined by PageRank and other factors, to show up at the top of the listings.

This will fuel new demand for search marketing services, as the industry reaches into an entirely new market. Local advertisers will discover what national and international marketers have discovered in the last 8 years: Search is the best online channel for providing qualified leads. Suddenly, the number of companies seriously considering search will mushroom from its current number (probably about 100,000 total, based on information from Overture and Google) to include almost everyone. This will fuel a new boom in search, both on the sponsored and organic side. Budgets will be small, but the opportunity will be rich for better do it yourself tools. This potential likely goes part way to explaining the seemingly high valuations placed on recent acquisition deals including WebPosition Gold (by WebTrends) and GoToast (by aQuantive).

How Yellow turns to Gold for Search

The question on a lot of industry analysists minds lately has been the sustainability of sponsored search revenue. I'm getting asked this question weekly by analysts from several investment firms. I think the answer becomes apparent, in the long term, when you look at the potential for local search.

The yellow pages industry accounts for about 16 to 17 billion in annual revenue in North America. Right now search is about a 2 to 3 billion dollar a year industry. Overture has about 100,000 active advertiser. While impressive, this number only accounts for 0.5% of all the businesses in North America. As search takes over for the Yellow Pages, the revenue growth opportunities are immense. Don't worry, search's day in the sun is still yet to come.


Copyright 2004 - Searchengineposition Inc.