Yell.com: Not the future for local search.

Yell.com are one of THE big names, everywhere, which is why I was suprised to read the other day about their financial difficulties (and tweeted about it).

Yell.com are seeking to refinance £3.8billion (that’s £3,800,000,000!) and, at the same time, are looking to raise a further £660m (that’s another £660,000,000 ) from its investors.

For most business owners these figures are incomprehensibly large.

At its simplest level Yell.com provide directory services to businesses and generates revenue through advertising. That’s a simple enough concept for most of us to grasp and makes one wonder why, therefore, Yell.com are in such difficulty.

The simples answer is, of course, The Internet and the shift in consumer habits in relation to local search ( I do, however, accept that there are some complex issues behind the current difficult financial situation)

Personally, I can’t remember the last time i looked at the Yellow Pages so I took a quick straw-poll of my friends to see what they thought. Not one could remember the last time they used Yellow pages (nor yell.com for that matter) to find a local product or service over using The Internet. Not one could remember the last time they dusted off their copy of Yellow Pages and tried to find their local drain unblocking service, removals company or dentist.

And there’s the rub: More and more frequently, consumers are turning to the Internet as their first point of call for local search and, with some 90% of the UK market, Google will be the main deliverer of results for those searches.

As businesses catch onto this situation and turn to direct, online, niche search, they will benefit from reduced advertising costs and improved conversions. Where though does that leave Yell.com, its debt and investors?