The Digital Transformation of Yellow Pages Group by YPG CMO, Nicholas Gaudreau
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How does a company with a long-standing “analog” business transform itself into a digital player? Nicolas Gaudreau, Yellow Page Group’s chief marketing officer, provided meshmarketing with the inside story into the strategic and tactics steps and processes that have helped the company’s position itself in the digital world. Nicolas will offer insight for companies evolving their business, highlighting best practices, challenges and what to avoid.
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The Digital Transformation of Yellow Pages Group by YPG CMO, Nicholas Gaudreau
- 1. The transformation of Yellow Pages Group By Nicolas Gaudreau. CMO, Yellow Pages Group 1
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- 6. Newspapers’ Descent Into Hell
- 7. “An iPod, a phone, an internet mobile communicator... these are NOT three separate devices! And we are calling it iPhone! Today Apple is going to reinvent the phone. And here it is. - Steve jobs, 2007
- 12. Until Recently, the Internet Was an “Activity” by: yiibu.com
- 14. Changing the Way your Potential Clients Search for your Products and Services
- 15. The Decline of Print Base (Starting at 100) Boom ! 200 150 Real GDP - Canada 100 Print Usage - Reach 50 YP-Print 0 2000 2001 2002 2003 2004 (1) Scotiabank – Global Economic Research (August 2013) 2005 2006 2007 2008 2009 2010 2011 2012 2013 1
- 16. The transformation of Yellow Pages Group Print Revenue CAGR: -10% 1,300 380 975 285 650 190 325 Digital Revenue CAGR: 28% 95 0 0 2007 2008 2009 2010 2011 2012 2007 2008 2009 2010 2011 2012
- 17. The 7 Components of the Transformation The vision of the digital transformation Digital products Technology and execution Sales strength The brand Digital culture The digital experience
- 20. 37% Digital 20
- 21. change la manière dont vos clients potentiels cherchent les produits et services que vous offrez
- 22. SMBs are Looking for a Turnkey Solution 63%
- 23. 2 – The Transformation of Products 23
- 25. Search Engines
- 26. The Addressable Market Goes from $1.5 to $6 billion $7 $6 Business solutions (social..) $5 Mobile billion $4 Research $3 Websites $2 $1 PYP/ IYP $0 2010 Traditional market PYP/ IYP 2014 Market with the 360 solution 26
- 27. The Role of Analytics
- 28. 3 – The Transformation of Technologies
- 29. 4 – The Transformation of Sales
- 30. Google’s First Partner for SMBs in Canada
- 31. Transformation of the Acquisition Culture
- 32. 5 – The Transformation of Digital Culture
- 33. The Transformation of Innovation
- 34. inside 350,000 app downloads 175,000 active users (weekly) 150,000 push notifications opt-ins 34
- 35. New Talent
- 37. An Open and Multi-directional Communication Culture Vente tibbr
- 39. 6 – The Transformation of our Consumer Experiences 39
- 40. …in 2009
- 41. 6 million downloads 35%+ of our digital research 41
- 42. Digi Awards Top 25 of all time Editor’s Choice
- 43. A World of Partnership
- 44. Neighborohood section 7 – Rebranding
- 45. Making a 100-year-old Brand Evolve
- 46. anthem video
- 47. $400 million in Digital Revenues NEW PRODUCTS NEW BRAND NEW EXPERIENCES New advertising campaigns NEW ECO-SYSTEM YP analytics SEO SEM Online placement Mobile advertising Websites Social presence From the phonebook to the digital leader in Canada
- 48. A Noble Cause
- 50. Mistakes and Difficult Lessons • Act at the first signs • Do not look back, but do not sacrifice everything • Everything will take longer than planned
- 51. How to Get Through a Digital Transformation • Establish a clear and unanimous vision within the executive committee. • Quickly identify where competition will come from • Communicate and unite • Dare to doubt yourself frequently • Celebrate all accomplishments by putting them into the context of the goal to achieve • Mass-invest in new digital talent
- 52. Thank You!
Notas del editor
- As an introduction to break the ice and illustrate the subject of digital transformation, I always like to use this image. So, those in the room who are familiar with this strange object to the left, raise your hand. Now, those who understand the relation between this object to the left and this drawing to the right raise your hand. You see, the digital revolution has made many objects and industries that we took for granted obsolete.
- As an introduction to break the ice and illustrate the subject of digital transformation, I always like to use this image. So, those in the room who are familiar with this strange object to the left, raise your hand. Now, those who understand the relation between this object to the left and this drawing to the right raise your hand. You see, the digital revolution has made obsolete many objects and industries that we took for granted.
- As an introduction to break the ice and illustrate the subject of digital transformation, I always like to use this image. So, those in the room who are familiar with this strange object to the left, raise your hand. Now, those who understand the relation between this object to the left and this drawing to the right raise your hand. You see, the digital revolution has made obsolete many objects and industries that we took for granted.
- We need only to think of Kodak, the 100-year-old company that disappeared completely from its market.
- Or we can simply look at what has happened to the newspaper industry. After reaching their apex in the year 2000 after 50 years of spectacular progress, they have come full circle in only 10 years.
- Obviously, if I am bringing up Kodak and newspapers, it is because Yellow Pages Group has faced the same threat of disappearing. This threat took shape in 2007 with the arrival of the iPhone and this announcement by Steve Jobs.
- This announcement was like a bomb going off in our industry. Everything changed from one day to the next. Forever.
- Of course, at first iPhones and other smart phones were for young people, the “techier” types.
- But this revolution has now reached all social strata and age groups. Even the Pope uses Twitter and has over 300,000 followers.
- The turning point came in 2012 when smart phone sales surpassed computer sales. From that point on, we were going to live in a world that is always connected, always mobile. Always on. Always connected.
- These smartphones have changed our internet usage. Before these phones, internet usage remained a separate activity, apart from others. We stopped what we were doing to “go onto the internet”.
- And this is how Yellow Pages Group found itself faced with an immediate need for change. It should be noted that, historically, Yellow Pages Group’s revenues were almost 100% tied to print with our phonebooks. In fact, they were a source of revenue that grew at a stable rate and followed the GDP curve.Until 2008, print revenues followed the GDP curve and everything was good in the best of all worlds. Then suddenly, in 2009, our print revenues began to drop.
- The story I am going to tell you today is about the transformation of Yellow Pages Group, a company that saw its traditional revenues melt at a staggering pace. In five years, our print revenues melted at a rate of approximately 40%, close to $500 M between 2007 and 2012. I will tell you how, faced with this steep decline, we transformed ourselves and created a new source of revenue: digital revenue that went from $110 M in 2007 to approximately $400 M for annualized Q2 2013. In fact, our digital revenues as a percentage of total revenues went from 8% in 2007 to 41% for Q2 2013.
- Never in the history of Canadian companies has a traditional company transformed into a digital company so quickly and so deeply. This accelerated digital transformation happened simultaneously through 7 elements.
- The first element of the transformation is the transformation of the company’s vision. Firstly, it should be known that our clients are approximately 300,000 small or medium-sized businesses (SMBs), like this baker Roger.
- There are approximately 1.1 M SMBs in Canada. All of these businesses have marketing expenses that make up a market of over $10 billion.
- If we look at these advertising investments, we can see that they are divided in two. Firstly, the grey section represents traditional media, such as TV, newspapers, our phonebooks, etc. Then there is the blue section that represents digital media. What we can see is that the blue section represents 37% of total expenses This blue section is fast-growing. It represented 31% just 2 years ago.
- Secondly, the transformation of our line of products. To offer this digital turnkey solution, we had to quickly expand our line of products. In a few years, we went from being a company that offered print adds to a company that offers a complete range of digital solutions.
- We now offer a full range of website building. In the same way that an SMB needed a shop window in the past, they now need a website to exist. We are in fact one of the largest providers in Canada.
- In the digital world, a business’s website is their shop window and search engines can be compared to the main street. Indeed, this is where a large part of digital clients come from. We just said it, a business that creates an attractive website with relevant content increases its chances of being found in Google, Yahoo and Bing. But this is only the first step. You also have to make sure to outdo the competition in the search results, especially when the competitors also have a website.Here are two ways to achieve this:Search Engine Optimization (SEO): this consists in optimizing the business’s website by placing within it the key words searched most often by their clients. Key words must be placed in certain specific areas to correspond to the technological processes used by Google to reference sites. It is a specialty unto itself that goes beyond website design.Search Engine Marketing (SEM): it is also called advertising by key words. It consists in triggering an advertisement at the top of the results page when certain specific key words are searched. Since key words are auctioned off by search engines, the entire SEM art consists in identifying the key words that bring the most visibility without costing too much.
- This broadening of our range of products has had the effect of quickly increasing the size of our addressable market. While with our traditional products we had an addressable market of approximately $1.5 billion, our new addressable market is of $6 billion.
- One of the key elements in a new digital world is the role played by analytics. There was much discussion about the infamous “big data”. At Yellow Pages Group, we have developed a transparent approach with our clients by way of a tool called Yellow Pages Analytics. With this tool, our clients have access in real time to the results of their advertising campaign with us.
- Thirdly, the transformation of technology. Nothing in our technological infrastructure had prepared us for facing this digital transformation. From a technological point of view, we inherited a set of obsolete systems from the print era. An incredible mix of systems that did not suit our needs. In order to acquire a digital infrastructure, we created one of the largest concentrations of digital talent in Canada right here in Montreal.In fact, we hired over 300 programmers and technologists, which created a center of excellence unsurpassed in Canada.
- Fourthly, the transformation of our sales force. Our sales force is one of the greatest in Canada. We have over 1,100 salespeople who speak to over 300,000 clients per year. Barely 5 years ago, this sales force actually took orders for print adds in a near-monopolistic world. Now after 4 years of transformation, we have 1,100 salespeople able to fight in a very competitive field to sell sophisticated website and search engine products. We achieved this through an ambitious training program. A sales person receives approximately 50 hours of training per year.
- We have also changed the company’s acquisition culture. In our current competitive world, we have had to develop an acquisition culture based on direct marketing and market stimulation premises.
- Fifthly, the transformation of digital culture. We came from a traditional world without much innovation or the need to innovate. This has changed dramatically in a digital world. We had to develop an entirely new culture that was completely foreign to us: the culture of fast innovation and a taste for risk.
- When you innovate, you must accept that failure is likely to occur in some cases, as demonstrated by these 2 brands: Deal of the Day and urbanizer, two projects that did not yield the expected results.
- However, when we innovate, we also sometimes land on winners like with this brand, Shopwise, that was an instant success and won many prizes.
- To be able to compete in the digital world, we had to mass-recruit new talent in all fields. Be it in sales, marketing or technology, the Yellow Pages Group had to recruit the new knowledge and talent that we were sorely lacking.New talent that had a different view of the world and that continuously questions the status quo.
- We also had to learn to communicate differently. The traditional top-down method of communication no longer works in a digital world. This transformation of the methods of communication had to pass through the executive team who had to adapt to social media communication, such as Facebook, Twitter and LinkedIn.
- We had to adopt an open and multi-directional mode of communication. For example, we now have an internal social network that we use to stimulate and support sales.
- Finally, within the transformation of digital culture, we have had to transform our governance. We had to adopt new success measures. EBITDA and profit margins no longer being enough, we now speak of unique visitors, frequency and cost per click.
- We won many prizes and our applications are on the list of the most popular applications of all times.
- Finally, we are at the 7th element of our digital transformation, rebranding.
- Yellow Pages is a 100-year-old brand that benefits from great notoriety and many positive attributes, such as trust. However, it is also a brand that is deeply rooted in the past.We have had to rejuvenate it, while still capitalizing on our strengths. Our repositioning relies on our intimate knowledge of each neighbourhood. No one in Canada knows neighbourhoods like we do, we are the champions of local economy.This new position ensures that the Yellow Pages Group has a place in the digital world.
- So, with these 7 elements of transformation, Yellow Pages Group is no longer the company that your parents knew. We are no longer a phonebook company, but rather the largest digital company in Canada with close to $400 million in annual digital revenues in 2013.
- But the story of Yellow Pages Group’s transformation is more than a story of digital revenues.This transformation is actually a noble cause because Yellow Pages Group contributes to the success of our SMBs throughout Canada and supports the competitiveness of Canada’s SMBs.Moreover, by creating and maintaining hundreds of highly-qualified digital jobs here in Montreal, Yellow Pages Group is a key player in Montreal’s digital economy.
- Never has another company transformed itself so quickly and so deeply. When you undergo such a transformation, you truly feel like you are sometimes at the wheel of a Formula 1 car going full speed, that needs a tire change without stopping. From this unique experience, I now want to share with you a few key lessons.
- Firstly, digital transformation will affect all companies in one way or another.You have to be able to recognize and act at the first signs. The transformation sometimes takes longer to arrive, but once it hits, it will hit hard.Once the transformation has begun, there is no looking back. Getting attached to the past only results in losing precious time. You also need to know how to transform without sacrificing everything. All actions must be consistent with the new vision.Finally, not only do you need to start early, but you must be patient because everything will take longer than planned.
- Here are a few recommendations to optimize you chances of success: Establish a clear and unanimous vision within the executive committee. Transformation is not the business of a single department, but rather of all divisions.Quickly identify where competition will come from. In this new world, new predators are watching you and the competition has many surprises in store for you.Communicate and unite. You must have the commitment of the employees, you must reassure them and obtain their unconditional support. They must have faith in a better future.Dare to doubt yourself frequently. You must be wary of complaisance and especially never take anything for granted.Celebrate all accomplishments by putting them into the context of the goal to achieve. This will give you a great amount of credibility with all parties who will need to be reassured when the storm will be strongest.Finally, mass-invest in new digital talent. The competitiveness and longevity of a digital company is dependant on only one factor – the strength of their digital team.