Monday, March 23, 2009

Offline Advertising for Lawyers: Does It Make Sense?

The Kelsey Group released a report in 2008 on directory advertising that sized the market at $16.3 billion each year. 2.8 billion, or 6%, was spent online. In 2012, they projected the market would grow to $18.8 billion, but that 38% of it would be spent online. This means that offline Yellow Pages would shrink by $2 billion each year.

On the surface, this appears to be massive growth in online advertising, much of it at the expense of offline. Living in the trenches everyday, it makes me wonder . . . why isn't the shift isn't more dramatic?

While there are a ton of psychological factors that slow adoption to a new technology, if the invisible hand of the market really worked, the split between offline and online should essentially flip. However, the biggest strength of online advertising - namely, the ability to track and measure the ROI of the advertising - is also its biggest weakness.

To illustrate my point: Ever go to at 3 AM, find the site down and get angry? Remember when eBay went down for 12 hours back in 2001 and merchants were protesting?

Surely you would not be mad if you went to an bricks and mortar store at 3 AM and found them closed. Prior to 1997, eBay merchants had limited options for selling their goods, and all of them required spending substantially more money than eBay.

The simple fact is that Internet media is held to a different standard than offline companies. Because we can calculate what it costs to acquire a client, we do. And if we don't like the cost, we don't spend. However, I have not found a local lawyer that can tell me, with any precision whatsoever, what their cost per client was through the Yellow Pages or the local newspaper. If they did, the market would shift a lot faster than the Kelsey Group suggests.


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  2. I disagree that the shift from YP to online is dramatic. Six of my PI attys put tracking numbers on their YP ads last year.

    Half did not get a single call other than sales solicitations.
    Two didn't get any clients from their ads.
    The other did get a couple - but it was in the hispanic directory. (Have found historically latin community does not embrace online search as robustly.)

    Also seeing this in other verticals - main exception would be tree services. Have a couple of clients that are at least breaking even with their investment. In emergency situations (or when the power is out), we may not have online access. Interestingly enough, my tree guys say that the online inquiries tend to lead to more price-shopping than their YP calls. One client told AT&T he was pulling his ad (he was spending about $3k a month). They came back around and offered him a per-call alternative. He's paying significantly less - varies each month - but never been more than $1000/month.

    Yellow pages are desperate. They are finally having to scurry to retain clients.

  3. I remember when eBay would go down constantly...count me amongst the angry masses! :) Thank you for the informative article. Can't wait to peruse the rest of your site.


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