The ever-provocative Chris Smith pointed me to a blog post in which he criticizes the amount of money — $3.85 million — that AT&T reportedly paid for the domain “YP.com.” Putting aside the price, I think the acquisition is part of AT&T’s consolidation of the “yellow pages” brand online.
Chris also mentions the nearly $100 million that BellSouth and SBC (which were merged and became AT&T) paid for “Yellowpages.com” several years ago. If you consider that second acquisition solely of a domain you probably feel the price tag was totally outrageous. If you consider the price tag the cost of the brand “yellow pages,” it’s not that much potentially. I was initially in the former camp but quickly became a member of the latter camp.
Chris’ post discusses SEO issues but he opines about what he feels is the declining value of the brand “yellow pages”:
Fewer and fewer users are typing “yellow pages” into Google, as this graph demonstrates. It would’ve taken “yellowpages.com” a good many years to repay for itself even when the traffic for “yellow pages” keyword searches was good, but with this declining trend in those searches very apparent, this is no longer a realistic longterm investment, and it will turn more rapidly into a major capital loss.
Considering this ongoing, downward trend, the monetary worth and traffic-bearing value of both “yellowpages.com” and “yp.com” are declining. Many feel that the overall concept of “yellow pages” could be fast disappearing as well, and that will leave these as very dated-feeling trademarks only a short ways down the road. I’d say there are a very good number of young consumers today who don’t even know what “yellow pages” is! So, even the brand name value of these appears very short-lived.
I don’t necessarily agree that the brand value of yellow pages is eroding as fast as Chris suggests. But I do agree that yellow pages doesn’t have as strong a consumer association with local online in the way it does offline.
As Oprah might say: What do y’all think?
Screenwerk 
January 15, 2009 at 5:32 pm
Interesting graph, I think its great testament to the power of local reviews and social features in the IYP space.
What would be interesting to plot on here would be the monetization these guys get for each of their sites, as although yelp is leading the way on traffic I would imagine the traditional online yp are still bringing in the big money from the local and national advertisers.
January 15, 2009 at 5:34 pm
Phil:
What’s your opinion of the Yelp launch in the UK?
January 15, 2009 at 6:35 pm
Good discussion. I agree with most of what was said.
I’ve always thought measuring the search term “yellow pages” isn’t a good proxy for IYP usage. True, IYPs get a lot of upstream traffic from search engines according to Hitwise (likely less after universal search/local 10 pack).
But I believe these search terms show more specific intent — mostly including a business names or category/geo modifier (as opposed to just “yellow pages”). User sophistication overall is trending towards more granular search terms in this way according to Yahoo and other data that have been published.
IYPs also sidestep search in lots of cases by relying on a great deal of direct navigation traffic – partly due to the strength of the domains they’re paying so much for. Not to say that their SEO game couldn’t use some sharpening (a whole different issue)…
January 15, 2009 at 6:41 pm
IYP=AOL?
January 15, 2009 at 7:06 pm
The fact that they’ve made all of yp.com redirect to yellowpages.com makes it appear that they purchased the domain just for traffic value. Unless they do something with the domain, this value is going to disappear, too, as all the indexed yp.com URLs fall out of the SERPs.
So, initially at least, it doesn’t look like this was done for brand value at all to me. And, with “yellow pages” phrase searches falling off, I think that if it was, it was a poor choice, like I outlined.
Mike – I wasn’t suggesting that IYPs’ traffic is falling off, necessarily — just the traffic stemming from users searching for the specific phrase, “yellow pages”. Indeed, IYPs get traffic from a huge set of long-tail combination terms.
I wouldn’t have been questioning this if they were buying lots of local search term combination domains, like what Marchex did.
January 15, 2009 at 7:09 pm
Also – I think Greg had earlier theorized that the yp.com domain name was perhaps purchased with the intention of being used as a mobile device type-in domain.
If so, the domain itself is good in the sense that it’s nicely brief.
However, it’s not at all intuitive that that combination would allow mobile users to access yellowpages.com content on their mobile devices — so, they would have to train their consumers to do this, and that’s something of an uphill battle — still highly questionable to me whether even that usage would be worth the pricetag.
January 15, 2009 at 7:16 pm
Declining usage of YP’s doesn’t necessarily go hand-in-hand with a diminished brand. For the technorati, yes. For mainstream America, millions know and rely on YP and when they visit sites like CitySearch and others, they think of them as yellow pages sites. I’ve been to foreign countries that don’t have local equivalents of yellow pages, but they’ve heard of the phrase and know what it means. The phrase still has alot of currency. Whether that justifies the price tag on the domain, that I don’t know.
January 15, 2009 at 8:30 pm
I think the Yellowpage.com domain is incredibly powerful at generating clicks from the Google SERPs, There are so many branded – or company name searches that take place at Google every day, I always call these recovery searches.(borrowed from Battelle book the Search) when someone is searching for Franks Flowers all they want is the phone number or address, my hunch is they scan down the results and see the http://www.yellowpage.com URL and click, it is a trusted brand. I think that URL can overcome some of the normal CTR fall off we see as a sight drops to spot 2, 3, 7 or 10 in the SERPs. I don’t have any stats to back this up it’s hunch. Anyone got any data to prove it right or wrong?
January 16, 2009 at 2:14 pm
Greg,
Interesting. Chris mentions that AT&T is wholly owned and not spun off like Idearc and RHD’s companies so it has revenue resources they don’t have. I see the purchase as a defensive action similar to one athletic team signing a player so that a competitor cannot have him. After all, what’s $3.8mm when you’ve already spent $100’s? Regarless of “yellow pages” lookups it’s probably worth it to protect the brand. Just my two cents…..
Joe
January 16, 2009 at 2:25 pm
$3.85 M is not a significant amount of money from ATT and i think that they will easily get that back buy integrating yp.com with other ATT search assets.
January 16, 2009 at 2:29 pm
I agree it was a good move for ATT to buy the domain.
January 17, 2009 at 4:38 pm
>powerful at generating clicks from the Google SERPs, There are so many branded
Interesting observation Gib. I suppose tacking on the phrase “yellow pages” to a category or business name may be a common search approach just as people do so with brands or sites such as “wikipedia” (ie: wikipedia subprime). In examining the number of search requests, KeywordDiscovery shows that “yellow pages restaurants” and similar variations appears more than 100 times. KD #’s should be viewed relatively not in absolute terms; so a comparison is in order- “chicago restaurants” appears 567 times. The “yellow pages” domain premium may be around 20%.
June 3, 2009 at 10:41 am
Mobile phone
December 9, 2011 at 11:24 am
Useful resource…
Here is one of the most useful articles I read on the subject…