Industry Transformation – Opportunity for Success
March 6, 2013 | Contributed by: Guest
Today’s guest blogger, Paul Plant of Radicle Consulting has over 30 years of experience in directive media and advertising. He launched Radicle Consulting in March 2010, and has acquired a diverse client portfolio, which he advises on all aspects of organizational and transformational change. He previously spent almost 20 years in senior management at Yell Group, in key marketing, sales and strategic operational positions in both the U.K. and U.S.
I read with interest Neg Norton’s recent blog, which makes reference to Sensis and Solocal (formerly PagesJaunes). His post reminded me of one of ice hockey legend Wayne Gretzky’s great quotes – when asked to explain his extraordinary talent, Gretzky is quoted as replying, “Skate to where the puck is heading, not where it is now.” His quote is a metaphor that many major companies would do well to heed.
The Sensis case study is a sage, and indeed sad, lesson for others to be mindful of, for here is a publisher that failed to grasp the opportunity, despite having more advance warning and insight than any of its peers.
Australia, by being so far removed geographically from the rest of the world, has typically been three or more years “behind the trend” with regard to what else is happening within the industry. Sensis was still growing print revenues as recently as 2009, while most of its global peers were by then facing up to the inevitable consequences of new consumer behaviours brought about by disruptive digital change. Its print business, both white and yellow, held up revenues and high margins for longer than any other publisher. Yet, when the inevitable migration away from traditional media came along, the company was unprepared. Even today, more than 70% of Sensis’ revenues come from print, while digital sales are heavily reliant on the reselling of Google Adwords.
Another worrying factor is that circa 40% of Sensis’ income has traditionally been derived from large premier and national account customers. And as these started to slash their print spend, Sensis simply did not have the digital product inventory available to compensate for the decreases.
Sensis still operates as a division of its Telstra telco parent, which perhaps in part explains its situation, for the telco has not viewed the directory publisher as a strategic asset, and continues to milk the business for its profits. New Sensis MD John Allan certainly has his work cut out if he is to turn the company around.
Solocal (PagesJaunes) did not have the luxury of the crystal ball that Sensis had yet failed to use. That said, they still had the foresight, vision, and courage to embrace the undeniable shift towards new digital products and media solutions.
It will indeed be fascinating to listen to Solocal President & CEO Jean-Pierre Remy at the forthcoming LSA Conference in Las Vegas, when he explains the PagesJaunes success journey from traditional directory publisher to thriving modern digital media provider.