A look at market giant Sensis and their rapid decline in recent years. A lack of customer centricity?
How many of you remember these famous, Australian taglines?
Yellow Pages was a much-loved brand that pervaded our lives in Australia. Everyone depended on Yellow Pages to find services, look up business contact details and double as makeshift TV and monitor stands. But, times have changed. My 10 year old daughter doesn’t know what Yellow Pages is, or was. It still exists but its importance to our lives is substantially different.
In many ways, this is not a new story. During the last 10 years we have all watched Google gobble up the world into its search index and change the way we find stuff. Many, once prosperous businesses have been left crushed in its wake. Google is now the standard for finding things and today, businesses prefer to direct their scarce marketing funds into paid search rankings on the most prominent online channel, instead of using a brand from a bygone era that has lost its relevance to society. The speed and scale of this change is worth writing a few words about.
Sensis is the owner of Yellow Pages and White Pages, along with several other brands that have ebbed and flowed over time. It was until very recently, a wholly owned subsidiary of Telstra. During my time at Sensis in the year 2000 (called Pacific Access back then) I recall the vibe. Sensis was prosperous, omnipresent and arrogant. We referred to the company as ‘the rivers of gold’ – a billion dollar corporate king and a highly profitable division of Telstra. Today, it is a shell of its former self. Its revenue sucked dry by market dynamics that left it behind.
The Sensis ‘rivers of gold’ have now run dry.
2014 was a hallmark year in the history of Sensis. Telstra sold it to Platinum Equityon the 28th February 2014 for $454M cash (and $157M in fair value consideration). Well, 70% was sold off and Telstra secured ownership of 30% of the new holding company for Sensis, called Project Sunshine I Pty Ltd, in the transaction. Telstra recognised the transaction on its books as a discontinued operation in their advertising and directories business. Despite various attempts, the declining revenues could not be abated. Telstra bugged-out for a bit over half a billion. Big numbers yes, but this sale value is about the same amount Sensis would generate in revenues in one quarter only five years beforehand.
Sensis financial performance 2009-2014
This decline was not due to reducing demand for the company’s products and services – in that time revenues for Google had tripled. What had changed was how people search and consume information. Sensis, it seems, had taken its eye off the customer.
Businesses grow and die. The scary thing is how quickly a business like Sensis can dwindle from billion-dollar household name to very much no so in the space of five years.
The Sensis of today is very different. Not the giant it once was, but it has new ownership, a new look and feel and new propositions for the Australian business market place. It would be easy to write off Sensis as yet another business crushed by the might of Google. But wait, the story may not end here.
Not everything is campfires and marshmallows when it comes to the Google juggernaut. Is it just me or are other people getting a little tired of having web search results squished in between paid advertisements? Or, if you are a business that has ventured into PPC (Pay Per Click) advertising you would have noticed it is getting more and more expensive to get your ad positioned on the elusive top spot.
It’s a #digitaljungle out there.
It is a #digitaljungle out there. Online presence these days is complex to get right: search engine marketing, search-optimised web sites, responsive design for mobile/tablet support, social media amplification, omni-channel marketing strategy, etc. Perhaps what Australian businesses need today is an organisation that helps with both online and offline presence – to help wade through the complexity and chose the right channels in which to invest. The Sensis of today is leaner, potentially more agile and less encumbered by ego, legacy and old world bias. It might just be the right kind of organisation to deliver the right kind of support needed to businesses struggling to establish a faithful brand presence, online and offline.
Product marketers, like those at Sensis need to keep a keen eye on the customer, to uncover their needs and position valuable solutions that help solve customer problems – to be customer-centric. What problems can your organisation solve with the right kind of customer-centric focus?
To learn how product marketing principles can help create more elusive value for your customers take a look at the ‘Ready, Set, Go-to-Market’ training course at Brainmates.
‘Not happy Jan’ image sourced from Campaign Brief
‘Go Go Mobile’ image sourced from AustralianAds
Sensis financials sourced from Telstra Investor Relations
Google financials sourced from Google Investor Centre
This blog was originally published on Medium