Day says the strategy will cut down the church rate of the 400,000 Yellow Pages customers as well as increasing revenue by locking customers into broader deals. Sensis is also looking to leverage its advantage of holding the databases that comprise the Yellow Pages and White Pages telephone directories, making for a substantial amount of information it sees as a valuable asset for its marketing ambitions.
Upon its purchase, the Trading Post Group held a seven per cent share of the $1.7bn classified advertising market, and Day is planning to raise that over the coming months. He says this current strategy of cross-selling ads to small and medium sized companies is just the start. Currently, John Fairfax Holding and News Limited hold the majority of the classified advertising market through their multitude of metropolitan and suburban newspapers.
The acquisition of the Trading Post Group saw Sensis’ share of $10bn advertising market jump from 13 per cent to 15 per cent, and is part of a three year strategy to move its business beyond its staple of directory ads, which it holds a 95 per cent market majority. It follows on the heels of its purchases of CitySearch and Looksmart’s Australian assets over the past two years.
Sensis is predicting that the Trading Post Group’s revenue will grow 14.5 per cent to $148m during the 2004 calendar year, with earnings before interest, tax, depreciation and amortisation of $53m, up 15.2 per cent.