Magazine article Marketing

Rank by Name and Number

Magazine article Marketing

Rank by Name and Number

Article excerpt

Directories are one of the fastest growing media despite their lack of publicity.

Only two marketing media have increased their market share during the 90s: directories and direct mail. But, while the rise of direct marketing has been well documented, the growth in the directories business is still a well-kept secret.

In terms of press advertising expenditure, directories boast a 10.5% share of the market, ahead of consumer magazines which accounts for 8.5%. And, says the Directory Publishers Association (DPA), this [pounds]600m industry is still growing.

It's a diverse sector, embracing everything from the dominant Yellow Pages, which has 85% of the market in consumer classified directory advertising to editorially led business directories, which profit from database list rentals and cover price sales.

However they are funded, the main focus of directories has to be the user, says Les Kelly, group publishing director at Miller Freeman Information Services. "You have to define your market and work out its information needs first," he explains. "Directory advertising is not about awareness or display - the product is used at the point of need. Readers don't take a directory home to read in bed. They refer to it when they're looking for a product or service or when they want to know more about a company they are going to do business with."

Miller Freeman produces 22 directories, as well as publishing magazines and organising exhibitions. "Directory publishing fulfils a very important need for the whole of the marketing industry," claims Kelly. "We are one of the few media which look for new advertisers, particularly among small firms. When we sell them the concept, it might be the first marketing they have ever done. For [pounds]300-400, they will get meaningful coverage aimed at their target market."

And the market is growing as more and more companies are getting the message, says Kelly. "It's a virtuous circle. The more that firms advertise the more inclined other companies will be to join them." Winning over advertising agencies is, however, another story. "Agencies don't play a major part in our business," he says. "Advertising in a directory is a discretionary spend, it is not competing for marketing budget so we tend to approach businesses direct. But we do want to get the message across to agencies that we're an important part of the marketing mix."

One of the reasons for the increase in advertising spend is the dynamic growth in the use of the telephone, according to Terry Procter, managing director of specialist advertising agency, Procter and Procter. "The telephone has really come to life in the 90s as a marketing medium for sales and customer service. Finding telephone numbers has become even more important and that has fuelled spending on directories." He estimates that a company like Direct Line Insurance could be spending up to [pounds]1m a year on the three main directories: Yellow Pages, BT's White Pages and Thomson Directories.

"For many advertisers, it's a case of having to be there. As customer care has taken a leap forward, firms are spending more money putting their name and their logo on directory advertisements and listing more than one telephone number to direct customers to the right channel."

Thomson Directories has enjoyed an increase in its advertising customer base in the past year of 10% and expects a similar increase in 1996. "We have had good growth on a geographic basis," explains marketing and customer care director, John Rice. "We have been launching new directories in areas such as the south west, Scotland and South Wales." New A5 formats introduced into some localities have been well-received by advertisers and consumers alike.

But Thomson's plans for the future depend very much on the outcome of the Monopolies and Mergers Commission investigation into the dominance of Yellow Pages (see panel). "We would welcome the liberalisation of the market and would like to see competition from new, smaller players," says Rice. …

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