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How Yellow Pages is making the shift into the digital age

They might be clogging up your older relative’s garage, propping up your computer monitor or being used in dares, as people try (and fail) to rip one in half.

Yellow pages, or telephone directories, were once an essential part of everyday life before they became an afterthought in a world where information is always just a click away. Canadians used to rifle through the Yellow Pages Group’s tome to find the lawyers who represented them, the contractors who fixed their homes and the doctors who treated them when they were sick.

But now, YP wants you to forget about that big yellow book too.

Since the company appointed Julien Billot, a former executive at Solocal Group (formerly PagesJaunes) and Lagardere Active, as president and CEO in 2014, the Canadian company has been attempting to shift its business from paper to the web.

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So far, it’s been successful. More than 64.6 per cent of its total revenue came from digital in the first quarter of 2016, up from 54.8 during the same period last year.

And Billot hopes that's just the start.

The 47-year-old CEO wants YP to be the “the local company in Canada.”

That means he wants an assortment of Canadians businesses – not just its traditional base in the service industry – to turn to the company for help in creating a digital presence.

“Since I arrived in 2014, we decided to use digital as an offensive weapon to gain market share,” Billot said in an interview with Yahoo Canada Finance.

“Because, of course, in some markets we were very strong but in some others we had virtually no market share."

Part of the company’s digital strategy has involved acquiring “verticals,” or companies that are focused on niche markets, including: online restaurant guide dine.TO, restaurant reservation service Bookenda, real estate service DuProprio, advertising firm JuiceMobile and bargain-hunting website RedFlagDeals.

It also built up its own offerings, including: restaurant guide website YP Dine and deal-hunting website YP Shopwise.

“The overall idea is, build on a historical base, keep our revenues as much as we can, and, of course, grow our newest verticals, and the combination will make our company grow again,” said Billot.

The company is also pumping out editorial content on its website – often reviews, recommendations and listicles – about neighbourhoods across the country.

Billot says the efforts are a “small part” of the company’s traffic, but it's used to create local opportunities. The offerings are not branded content it is produced by a separate team.

But Billot’s new vision for Yellow Pages doesn’t stop there, he believes it can go even further to leverage its current digital tools.

The company released a white paper earlier this summer urging small retailers across Canada to increase their online presence or risk being swallowed up by online retail giants such as Amazon and Alibaba.

“The competition today is less and less fair in favour of local retailers,” said Billot.

“If retailers don’t wake up, at the end of the day … they will have no other choice than signing with Amazon, and I’m not sure it is good for the Canadian economy that all the retail economy will be driven by American-born players.”

[Yellow Pages chief executive Julien Billot, left, shows Quebec Premier Philippe Couillard some of the company's digital products at the Yellow Pages head office on March 18, 2016 in Montreal. (The Canadian Press)]

Fiona Story, Yellow Page’s director of public relations, said the company’s research shows that 53 per cent of local retailers don’t feel online is competition.

Billot added that 90 per cent of consumers will do research online before buying anything, and most small businesses know that. But many are still “very defensive” and some don’t even have a website, or if they do it is old and not customized for mobile.

And the white paper was released to get to them to react now.

“Because if you don’t, 10 years from now the game is over,” said Billot.

That’s where Yellow Pages wants to step in.

Billot believes the company can use its verticals, wide variety of technologies and manpower to help local business create a web presence that will help them fight the online giants.

He said on their own, small retailers can’t compete with the search engine optimization power of Amazon or Alibaba, which allows their listings to show up at the top of Internet searches.

“Some of them will do it but most of them will not be able to, unless they’re leveraged by a power brand and, we think we can be that brand,” said Billot.

Yellow Pages says it can help build their digital presence through a variety of in-house services including:  optimizing their website for SEO, building their Facebook page, putting together an advertising campaign, setting up a booking engine to provide reservations online, organizing their delivery systems, integrating their point of sales systems, setting up their customer relations management, providing GPS-based technologies and putting together a loyalty program, among other offerings.

“There are technologies that exist with Yellow Pages that we are offering in other verticals already,” said Story.

“We currently don’t do it in retail, but there’s an opportunity there because what’s come out of our other activities is an understanding that there’s a huge digital gap in the retail segment, so they’re all things easily scalable for us.”

Yellow Pages says it has also started piloting beacon technology, which allows retailers to detect a consumer’s location and send them timely alerts promoting products or passing on useful information.

The company says 245,000 small and medium-sized enterprises – more than 20 per cent of all small businesses in Canada – are already relying on Yellow Pages for marketing services.

Yellow Pages reinvention efforts are also visible in its recent advertising campaign. One of its main spots, which aired on TV during the Stanley Cup playoffs, revolves around the company’s creation of a small business called the Lemonade Stand in Toronto and how it used in-house digital marketing tools to promote it over the course of a week.

“The concept of this campaign is to say to people, ‘that’s what Yellow Pages is now. Forget about the book, forget about the listings,” said Billot.

But Yellow Pages, hasn’t completely cut ties with the past, yet.

While Billot said its physical phone directory will ultimately “disappear over time,” and that’s mostly the case already in major Canadian cities such as Toronto and Montreal, he said it is a “very different” story in rural markets where the usage is still “high.”

He said, in particular, the usage rate is still hovering in the around the high 70 per cent range in Atlantic Canada, and Winnipeg remains a “very strong market.”

“We make simple changes to print directories that we deem in rural markets are necessary, people are very attached to their directory and we get complaints about it,” said Story.

Billot added that all 300 of the company’s Yellow Pages books are all “very profitable,” and print has to be involved in its marketing efforts if a customer is looking to break into a small market.

But Billot’s focus for the future is capitalizing on what he says is $10 billion in advertising that is going to switch from print to digital in the next five to 10 years.

“You know the wave is coming, we want to be on that wave,” he said.

The plan is for Yellow Pages, whose revenues dropped from $877,528,000 in 2014 to $829,771,000 last year, to get on track for growth by 2018.

“Our mission … which hasn’t changed over the last 100 years that we’ve been existence, is really about ensuring that we are creating local opportunities between small businesses and their prospective clients, so continue to do that – we’re just doing a majority now in digital,” said Story.