Directional Marketing Outlook
The Kelsey group released on the overall growth of the advertising market. One of the most interesting aspects was the projection that Yellow Pages advertising would grow to $41.4 B, with a combination of the print and online sales.
Through 2007 to 2012 The Kelsey group predicts we will see the following:
- Local search revenues will grow from US$2.1 billion to US$6.6 billion (25.5 percent CAGR).
- Print Yellow Pages revenues will decline from US$27.5 billion to US$25.6 billion (-1.4 percent CAGR).
- Internet Yellow Pages revenues will grow from US$3.7 billion to US$9.2 billion (20.1 percent CAGR).
We don’t think there’s any surprise here in regards to the overall trends with print advertising declining and online advertising increasing. Over a 5 year spread we would have though the divide would be greater though, with many consumers moving away from the print based directories.
One area of surprise was the Kelsey prediction that Yellow Pages print revenue in Canada would actually increase at 1.5%. We have a hard time understanding this trend and suspect it might just be a revenue reporting issue with the Yellow Pages group in Canada that is distorting the values.
Comments (1)
The reason why revenue is increasing in Canada is that they are now just seeing a growth in the amount of independent publisher competition like the US has had for some time. New entrants don’t result in a shift in market share. Instead, for the first few years the market actually grows as advertisers try both products.