As I said before, I left Idearc recently after almost 10 years with the company. I have notices lately that it has gradually been turning into a hire ’em and fire ’em style culture. The company has been churning media consultants and managers. It is obvious that they want sales. I understand that it is a sales organization.
(I edited this article to add the following supportive quote on my “opinion”)
I am offering a quote from Andrew Rudin’s comment titled: “On My Honor, as a Salesperson . . .”: Why Sales Ethics Matter
Which business risk represents the greatest threat to shareholder value? Natural disasters? Terrorism? Product defects? Piracy? Patent infringement? Lack of ethical boundaries?
If you answered anything but the last choice, think again. The massive collapse of market capitalization at Tyco, Worldcom, and Enron underscores the grave dangers posed to shareholder value when employees lack an ethical compass. The cumulative decline in market capitalization resulting from fraud at these three companies was $136 billion, according to Public Citizen’s Congress Watch.
These scandals originated in the executive suite and required an ecosystem of compliant people to execute. What about ethical problems that originate elsewhere? What happens when ethical violations spiral from what are euphemistically called “aggressive sales practices?” In 1998, ethical violations at Prudential Insurance became so pervasive that the company’s management eventually estimated its liability from the pending class-action lawsuit at $2 billion. Among the voluminous courtroom testimony from the case was this nugget: “Your judgment gets clouded out in the field when you are pressured to sell, sell, sell.”
The company is allowing sales fraud to take place by Hispanic sales reps in the Texas area for Spanish yellow pages products and also paying these reps higher commissions to boot. (before you throw stones at me for stating this: If this subject were taken to court, I am more than 100% positive that it can be attested that what I am saying is true, and I have documentation to prove such) I think Idearc needs to read this article from Harvard Business School.
Idearc has to keep the print business and is forced to make it work. If it doesn’t work Idearc will not survive as a company. It is too horrible at servicing the internet business and offering the level of service it can offer with a print product. It is theoretically impossible for them to retain the same margin going forward as print rates start dropping and so does advertiser count. Idearc has lost many clients during the recession and it will be a challenge to win them back. I am also sure that they will also consider wiping existing client debt away (which is going to be great for sales reps commissions) to increase the amount of opportunity for sales results once they emerge from bankruptcy. Reminds me of the class action law suit regarding credit limits. Idearc will keep paying commissioned sales consultants for .com and ppc sales when the majority of the money goes to Google and Yahoo but declare the revenue not based on the management fee for PPC but the actual client budget (investors correct me if I am wrong?). Seriously, do you really think that Superpages.com is more than 10% of local search? Although, I do see value in both it’s print and online offering, your typical search marketing “uneducated” Idearc sales consultant is just in it to make a buck from a company that wants to get paid with unachievable margins. Yet in my professional opinion they have a few media consultants at the company who are worth more than weight in gold. Folks that have experience that even Harvard Business School could not teach. Working with so many different industries and on different forms of marketing, promotion, message and ad buying is a huge asset. Just my .02 cents.
If you need further visual proof of my statement on sales fraud… just grab a copy of the SuperDirect Postcard decks for the Greater Dallas area…. why are there so many Hispanic surname painting, remodeling, flooring, concrete, and landscaping companies in the decks? They are not making money if they keep allowing the credit limit to be given so freely in an attempt to show positive sales results while telling Wall Street that it was having issues with Receivables. Company motto going forward needs to be reward good paying clients for quality leads. Stop forcing paying clients to foot the bill for non-paying clients advertisements. Why should a reputable company lose calls to a no-pay business? It is hard enough competing in today’s marketplace without all the fraud. I think Idearc doesn’t need but 5-10 clients per category. Have a set rate per lead. Build a call center to screen the leads. Offer existing worthy clients premium opportunities. Kill all the free listings!
It was also apparent that Idearc wants a culture that rewards calling the same clients over and over with the same old spill. Reps are told to disregard notes that state “do not call” or NITC (not interested in telephone call). Now, I don’t know what Idearc’s upper management thinks about this and whether it is just local sales managers, but the thought of beating a client into a sale does not do much to resolve the issues it companies have with client churn. But hey….. according to some clients they just want your credit card number!
I will also mention that I have clients that are making serious ROI on advertising in the product. It does work. It just takes the right ad message, the right ad price, and the right position in the product. Media buyers need to step in and start buying ads for clients vs commissioned sales reps who have no clue what the business can and can not afford. Transparency in pricing will go a long way to helping the yellow pages industry. Make pricing more like Google and give up on this idea of a “affluent homeowner” using and urban scoped directory that takes a zillion lbs of paper. Heck, I remember someone actually stating that if you stacked the Greater Dallas Yellow Pages one on top of the other it would reach the outer atmosphere…. if this is true…. No wonder Ed Kohler at http://www.thedeets.com is going nuts!
(former Idearc Media Consultant speaking out)