Yell.com is a specialized search engine focused on the sale of
classified advertising for businesses in the form of an online
searchable directory. The company also has a significant presence in
printed directories, which of the present time comprises majority of
its revenue. However, the printed directory portion is experiencing
stagnant growth, along with a modest decline in advertiser retention
rate and prices. In contrast, the Internet-based business is growing
rapidly in terms of the number of advertisers and the number of
searches. In fact, the growth rate of advertisers only purchasing
listings on the web site exceeds the growth rate of advertisers
purchasing both print and Internet listings.
Current challenges for the company include compensating for the
gradual decline in interest in advertising in printed directories by
greatly increasing the growth of Internet-based advertising. New
competition from more generalized search engine such as Google and
Yahoo, who are actively increasing their local search capabilities,
may pose a threat to the appeal of online searchable telephone
directories. A Competition Commission inquiry into the business may
also adversely affect the company's ability to compete.
Important opportunities that the company is already seeking to exploit
included incorporation of additional information that is not possible
using a print-based product, such as maps and personalized address
books. Increased wireless access to yell.com data via both a mobile
Internet site and text messaging are also very promising growth
In conclusion, the online portion of the business is a very dynamic
and growing industry, whereas the print version faces challenges of
stagnant growth and regulatory obstacles. To be successful, the
company will need to continue to greatly grow its Internet advertising
business to compensate for the difficulties it faces in its much
larger print-based business.
"Yell is a leading international directories business operating in the
classified advertising market through printed, online and phone media
in the UK and the US.
Yell creates value by putting buyers in touch with sellers through an
integrated portfolio of simple to use, cost effective advertising
"Yell" Yell Ltd. (2006) http://www.yellgroup.com/
"Launched in 1996, Yell.com is a leading site for finding businesses,
shops and services in the UK. It provides quick, accurate search
results using Company Name, Location and Business Type as search
Information from Yell.com's database of around 2 million business
listings can be found via the Web site at www.yell.com, by using
Yell.com mobile - enabling wireless access to Yell.com data - and the
mobile Internet site (mobile.yell.com). A cut down version of the
information is also available via text messaging on 80248.
Yell.com provides several useful features to users, such as maps, the
ability to zoom in or out of localities and a personal Yell.com
address book to keep a record of those regularly used businesses.
Advertisers can join the service by links from Yell.com to their Web
sites or through our templated web creation service."
"Yell.com" Yell Ltd. (2006)
"Yell.com is a leading site for finding businesses, shops and services
in the UK through the Web and mobile telecommunications. Yell.com
features a database of around 2 million classified, UK businesses,
which can be searched by company name, location and business type. In
March 2006 Yell.com received 32 million searches."
"Product Overview" Yell Ltd. (2006)
"Yell.com revenue growth of 65%."
Issues with Competition Commission.
Number of searchable advertisers is growing rapidly, as is the number of searches.
"Investor Presentation" Yell Ltd. (June 2006)
Group FY 06
Print products are exhibiting slow growth and suffering from price reductions.
Yell.com still comprises a very small percentage of revenues.
Customer retention rates are dropping.
Significant growth is occurring in yell.com only advertisers, which
are growing a little faster than advertisers using both print products
and the web site.
"Preliminary Results for the year ended 31 March 2006" Yell Ltd. (May
23, 2006) http://www.yellgroup.com/80256DCD00552394/presentations/13B16758133668C0802571760058F2D2/$FILE/Preliminary+Results+May+06.ppt#256,1,Preliminary
Results for the year ended 31 March 2006
"The Competition Commission (?CC?) has today published its Provisional
Findings in the investigation into the supply of Classified Directory
Advertising Services (?CDAS?) and a notice of possible remedies. The
Commission is seeking further submissions from interested parties.
Commenting on today?s report, John Condron, Yell Group CEO, said:
?We are disappointed with the provisional findings. In our
increasingly competitive environment, and particularly with the rapid
growth of the Internet and the re-entry of BT there is no need for
continued regulatory involvement. However we note that in considering
what it feels to be appropriate remedies, the CC will ?have regard to
expected changes in the market?. We shall, of course, actively
represent our views over the next few weeks.? "
"Competition Commission?s Provisional Findings in the investigation
into the supply of Classified Directory Advertising Services" Yell
Ltd. (June 13, 2006)
"The CC has provisionally found that Yell can set prices to
advertisers above competitive levels, with a market share of around
75%, five times that of its nearest competitor. Yellow Pages is a very
strong brand and Yell, as the market leader, has high customer usage,
which reinforces its leading position. There is little, if any, price
competition and were it not for the current price control Yell would
be able to use its position to set prices that would be higher than in
a well-functioning market.
The majority of Yell?s prices have exactly matched the maximum
permitted by the price control and do not appear to be constrained by
competitors. Discounts are offered to some new advertisers and to
encourage increased expenditure, but the CC has found little evidence
that these discounts are given in response to competition, whether
from other directory providers or from the Internet. "
"Revenues for CDAS providers have continued to rise. Large numbers of
advertisers have not withdrawn or reduced their spending in printed
directories as a result of the availability of advertising on the
Internet. Advertisers appear to view the Internet as a complement to
existing CDAS expenditure. "
"CC PUBLISHES PROVISIONAL FINDINGS ON CLASSIFIED DIRECTORIES"
Competition Commission (June 13, 2006)
Additional information about the inquiry can be found at "Classified
Directory Advertising Services" Competition Commission
Search terms: "competition commission" "classified directory advertising services"