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UK Marketing and SalesHelen StevensonChief Marketing Officer
Steve ChambersChief Commercial Officer
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Disclaimer
During this presentation we will be discussing Yell’s business outlook and making certain forward-looking statements. Any statements that are not historical facts are subject to a number of risks and uncertainties, and actual results may differ materially.
We urge you to read the Risk Factors and cautionary language in the annual report posted on our website.
We also draw your attention to our press releases which are posted on our website, for more information on the risks and uncertainties.
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The virtuous circle
Great proposition for users
strong brands
Win, Keep and Grow strategy
great value to advertisers
Highly effective sales operation
unique relationship with SMEs
Our business model
Yell market
dynamicsCHANNELNEUTRALValue
toYell
Value to the
Advertiser
Valueto theUser
Recession resilient
4
A growing market
Use of information sources is growing...
0
50
100
150
200
250
300
FY 05 FY 06 FY 07
Internet*
Information Sources (product and services info)
Average monthly usage (millions)
Regular Study (Saville Rossiter-Base) *YP comparable inc Yell.com
5
Strong growth despite regulation
500
550
600
650
700
750
FY 03 FY 04 FY 05 FY 06 FY 07
Non print
Yell Revenue Growth under RPI (£)
Source: Yell Internal Data
We have achieved £105m in revenue growth in the last 5 years, of which £76m of growth was in Yell.com
-4.4% -4.8% -3.3% -2.9% -2.8%
Effective Yellow Pages rate reduction
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Well placed for a new growth phase
Strong plans to drive usage across all our channels
Yell.com well positioned with differentiated offer in its market place
RPI-0% and reduced Print product constraints provide price and product opportunities
Attract new, non-print advertisers to Yell.com and grow our hybrid commercial models
Drive integration across new media platforms including mobile
7
Usage is at the heart of our value proposition
*Source: Saville Rossiter-Base
Whenever and wherever all channels
Comprehensive and relevant
87% of UK adults use any Yell product*
Our users like buying from the people they find through Yell
Yell products are easy to use
Yell is best way to find businesses in the UK
Powerful brand family
Competitive values of trust quality and local expertise
8
Driving traffic on Yell.com
Driving traffic– New Media SEM / SEO / networks
New functionality and a new look to the Yell.com site
First of a series of planned quarterly improvements
Puts in place the foundations for future changes and includes:
– New contemporary look and feel
– New site structure
– New mapping– Local business layering
– Liquid layout
– Easier navigation
– New ad capsules
– Additional monetisation opportunities
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New look homepage
10
New search refinements
11
New maps with business layering
12
Plus directions
13
and bird’s eye view
14
Driving traffic on Yell.com
Driving traffic– New Media SEM / SEO / networks
New functionality and a new look to the Yell.com site
First of a series of planned quarterly improvements
Puts in place the foundations for future changes and includes:
– New contemporary look and feel
– New site structure
– New mapping– Local business layering
– Liquid layout
– Easier navigation
– New ad capsules
– Additional monetisation opportunities
15
Print innovations
Yellow Pages Reinvented– New look and feel, consumer content and
modernised classifications and search tools to improve usability
New local directories – Your Town– Locations determined by:
– Size of business base (>850k)
– Town Size (min circ < 25k)
– Across metro / urban / rural
– c70% of Your Town advertisers are new to Yell
Door Drop Specialist guides e.g. Car Insurance– Developed in conjunction with national advertisers
– Strong advertising vehicles that enable businesses to target specific group of consumers
– Key points of differentiation are brand, editorial content and production quality
Source: Yell Internal Data
16
Yell usage generates high quality leads
We generate 1.4 billion annual usage occasions
When users are asked where they have sourced products / services,
Yell is the best source for delivering high quality leads
Source: Regular Study 06/07 (Saville Rossiter-Base) YP comparable Internet based on asking users ‘could they have sourced that product or service through Yellow Pages’
Thomson
10%
20%
30%
40%
50%
60%
70%
0 20 40 60 80 100 120
Local press
BT
Yell
Internet(YP Comparable)
Total Internet
400...
Conversion of Usage to Leads (%) vs Usage (monthly average)
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Ensuring our advertisers see great results
Yell.com*
from every 10 uses
5 result in a contact
Yellow Pages*
from every 10 uses
7 result in a contact
Helping to generate over £83bn for Businesses in our products**
*Source Saville Rossiter-Base 2006-7 Users looking for information on Shops and Businesses**Source Saville Rossiter-Base 2006-7 YP and Yell.com combined
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Focusing on value
Ratecard growth at RPI-1% and prices aligned with value– e.g. a Plumber in Reading pays £365 for a Quarter Column*
– A Farm Shop in the same book with the same ad, would pay only £219*
Discounts used to influence behaviour
Proving value to an advertiser aids retention
Call Counter - Phase 2– Uses local dialling codes
– New call statistics platforms – provides our salespeople with even more compelling data to add value at point of sale
*Based on Reading YP directory rates for edition publishing in Feb 09
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Our growth strategy – Win, Keep and Grow
The value staircase
Building value for advertisers
regardless of channel
Content
Prominence
Traffic
Value to the Advertiser
Advert
iser
Spend
Entry Level
Entry Level
Content
Prominence
Traffic
1
2
3
4
20
Keeping and growing advertisers
As our relationship with advertisers grows, so does their spend and the value we deliver to them
Source: Yell Internal Data *Accounted Year Customers and Revenue for Print 06/07 **Regional campaign customers 06/07
in terms of tenure...
and product holding
ARPA Retention
Printed products £1,335 75%
YP and Yell.com** £2,100 84%
YP and Yell.com** and 118 24 7**
£3,372 86%
Print ARPA*
Print Retention
*
Year 1 £673 50%
Year 3+ £1,758 82%
21
Continual evolution of our hybrid commercial model
Paid inclusion
FIXED PRICE MODEL
Entry level pricing Try before you buy Tiered pricing Chargeable features Portfolio renewal Ad syndication
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New launch of ad syndicationlive 29th November
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New launch of ad syndicationlive 29th November
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Continual evolution of our hybrid commercial model
Our business model will continue to evolve in line with customer needs
Paid inclusion
FIXED PRICE MODEL
Entry level pricing Try before you buy Tiered pricing Chargeable features Portfolio renewal Ad syndication
Pay for prominence / flexible contracts
Pay on performance
PERFORMANCE MODEL
Pay per click Ad syndication Aggregation
Display / rich media
SPONSORSHIP MODEL
Price to value
25
UK SalesSteve ChambersChief Commercial Officer
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Selling – a core competence and key differentiator
Unique service to UK SMEs
Flexible sales organisation to ensure delivery of marketing strategy
People factor
Equipped with state of the art tools
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A unique service
Understand the customer’s needs
1
28
Industry specific marketing information
2
Understand the customer’s needs
1
A unique service
29
Bespoke presentation
3
Industry specific marketing information
2
Understand the customer’s needs
1
A unique service
30
1
2
3
4
Bespoke presentation
3
Industry specific marketing information
2
Understand the customer’s needs
1
A unique service
31
1
2
3
4
“We would recommend
Yell.com to anyone looking to attract
new business”
Bespoke presentation
3
Industry specific marketing information
2
Understand the customer’s needs
1
A unique service
32
Final Recommendation
4
Bespoke presentation
3
Industry specific marketing information
2
Understand the customer’s needs
1
A unique service
33
Value, efficiency and flexibility
Sales channels organised around customer needs
Campaign approach to maximise efficiency
Out of campaign activity for additional coverage
Flexible sales roles to target specific opportunities
Sales channel and contact strategy
Wider reach, more complex
Simple, local coverage
High volumes of targeted leads
Cu
sto
mer
sp
en
d
Telesales
Face to face
National
Customer needs
New media
Field
Majors
Nationals
3rd Party
Renewal
Fast track
New media
Prospects
Your Town
Business development
34
Channel neutral sales force
Multi-product sales targets
Pay weighted towards online sales
New pay schemes to drive Pay on Performance
Intensive online training
New media specialists for complex needs
All YP solus advertisers receive telesales contact between campaigns
Delivering online sales growth
Source: Yell Internal Data
£20
£40
£60
£80
£100
FY 04 FY 05 FY 06 FY 07
Revenue
% Growth
£ m Yell.com Revenue Growth
£
£
£
£
£
Revenue
£
35
Monetising online usage – a case study
Target sales person & track conversion
Arm sales person with pre-visualised ad
Yell.com AVP now exceeds YP
Match unsold inventory with high usage
Identify customer opportunities & push to sales person
AvaNor
10392711 J Tarry 01604845264 Cathy Mansell Lee Towse Double Glazing Installers
10406589 Alan Ullah 01604759681 Cathy Mansell Lee Towse Fascias & Soffits Nor
10604478 Yvonne Healey 01788 511081 Cathy Mansell Lee Towse CCTV Installer
10681353 Steve Bartle 01788510453 Cathy Mansell Lee Towse Lawnmowers & Garden Equipment
The Mower Shop Ben Ferguson Coventry Leicester
CRIME SECURE LTD Ben Ferguson Northampton
A & G Conservatories Ltd Ben Ferguson Northampton Northampton
Martindale Windows Ben Ferguson Northampton
Customer Target
SAP IDCustomer Contact
Telephone Number
Area Manager
First Line Manager
Available Classification
AvaNor
Nor
Company NameAssigned
Consultant Name
Available Book Available Book
Opportunity 1 Opportunity 2
First Line Mgt: Lee Towse
Consultant: Ben Ferguson
Yell.com Local Sponsored Listing Target OpportunitiesCampaign: N'hampton MP 223P 2008
Area Mgr: Cathy Mansell Available Opportunity
Source: Yell Internal Data
0100200300400500
FY 04 FY 05 FY 06 FY 07
Yell.com ARPA Growth (£m)
36
National Accounts
Face to Face
Telephone
Average Age 44 years 36 years 32 years
Average Service 14 years 5 years 3 years
Turnover 2% 20% 23%
On Target Earnings £62k £45k £33k
Job Satisfaction 85% 86% 83%
Headcount 59 1,261 844
Source: Yell Internal Data as of 31/3/07 and Tell Yell Survey 2006
The people factor – key metrics
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The people factor
Identifying top salespeople – profiling
Highly regarded training and development
Flexible working, part-time, home-working
High calibre Sales Management
Performance management – key element of sales culture
Emphasis on reward and recognition
38
Driving sales performance - pay
Source: Yell Internal Data
On target earnings – top quartile for UK media sales
Basic salary 75% of On target earnings
Open ended, performance related
New Media25%
Service10%
Prospects10%
Sell-Up30%
Renewal25%
Commission pool breakdown for field sales
Commission schemes structured to drive
desired behaviours of each sales role
Constantly
reviewed to ensure
alignment with
marketing
objectives
75%
100%
110%
Base
% Sales Target
OTE
Commissionable
Earnings
BonusBonus
Accelerator Payments
0%
4%
8%
12%
80% 112% 144%% to Target
Accelerator Payments
16%
20%
80% 112% 144%%
of
Bon
us
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Automating our sales force - added value, simplification and efficiency
Laptop / desktop technology plus broadband connectivity for all salespeople
Functionality– Workload management
– Electronic sales presenter
– Electronic ad design
– Order and content capture
Benefits– Error reduction
– Reduction in back office heads
– Added value at point of sale
– Simplified communication
– Home based sales force
40
Summary
Our market is growing but highly competitive
Print still provides excellent value; fresh opportunities under new regulatory regime
High growth opportunity in new media
Recession resilience
Well placed for these opportunities:– Great brands providing great value for users and advertisers
– Clear strategy to drive and monetise usage
– Highly motivated sales force
– Unique relationship with UK SMEs