Yellow Page City focused on Internet reach

The Rochester Top 100, which annually recognizes the fastest-growing privately held companies in the nine-county region, is sponsored by the Rochester Business Alliance and KPMG. Here is an interview with Steven Pavone, CEO and founder of Yellow Page City Inc.

What does Yellow Page City do? What need does it meet?

We sell ads into our online yellow page phone book. We have 2,600 online phone books. We're our own phone-number listing company. We list all the phone numbers and addresses of businesses, by region, in the United States.

Our ads are display ads and banner ads. We also sell businesses websites; they get their own address, or "dot com." The website, YellowPageCity.com, mimics a real yellow pages phone book. The print book has in some form been around for 90 years, so I felt if we are going to transition the country from a print book to an online version, it would be more familiar for the majority of population.

Our business plan hasn't really changed that much from the beginning, except that our focus is now on selling the full-color display ads into our directories instead of just selling the small business a website. Over 97 percent of our traffic comes from various search engines on the Internet. We purchase keywords from Google as an insurance policy for our customers to make sure they always have a steady flow of consumers both viewing their websites and calling them on the phone.

I think the need we meet is very basic. All small businesses just want more customers, but most can't afford TV, radio or newspaper advertising.

Almost all of them know they need to be on the Internet, but really don't know how to do it properly. Many of them have spent tons of money on an expensive website already, but their customer base doesn't know it exists and it falls to the wayside.

Tell us about the origins of your company.

We started in a small back office in my brother's carpet store, Sail On Carpets, in Spencerport, in 2000. Sail On purchased our first server for us, and we used their phone system for the first couple of years.

My partner and best friend, Gene Dunn, had always wanted to open some sort of Internet business with me, but we never seemed to come up with a really unique idea. It occurred to me that although many large businesses already had websites, almost no small businesses had them yet.

I wanted to build small, brochure-type basic websites at a reasonable cost for these small businesses and make it easy for them to be seen on the Internet. We would sell a website for $30 a month. That included a basic template-designed website, Web hosting and a button or link to that website from RCityWeb.com.

It didn't take long for Google, Yahoo and MSN to notice us, and our traffic increased very quickly, which meant consumers started using our website to look up a business phone number and maybe link to that business website.

Who needs and buys your products? Who are your customers?

Ninety-eight percent of our customers are small to medium businesses that want and need a good return on their advertising investment. They are the beauty salon down the road and the attorney on Main Street. These businesses are the heart and soul of our business. Every one of them is important to us and we treat them as though they were multimillion-dollar companies.

What kind of demand are you seeing?

First, let me say that 2009 was a banner year of growth for us, but you ain't seen nothing yet. In 2010, every month was a new record month for us. We started out in January 2010 with the largest month of sales in our 10-year history and every month after that turned out to be larger than the last. We started our national sales program in 2008 and have consistently ramped up to our present sales volume.

You are a small business. Do you hope to expand?

We are hiring four people a month for sales positions with the realization that we may only keep two. Phone sales is not for everyone, but if it is your cup of tea, at least at Yellow Page City, you can make an extremely high income.

We presently work out of a 10,000-square-foot facility and are looking for a 15,000- to 20,000-square-foot office space to move into by July.

This will be our fourth move in 10 years because of the growth of the company. I hope to expand our work force by at least 24 salespeople in 2011 and do not see an end in sight.

How much competition do you face?

There are definitely many players in our arena and not all of them are ethical or reputable. The good news is many non-profit consumer advocate companies like the Better Business Bureau have done a great job at weeding out the bad eggs and educating the public.

We have separated ourselves from the pack by partnering with companies like the BBB and local chambers of commerce in markets we sell in.

I think as print phone books go away, we will see a lot more competition, but I believe competition is good and only makes you and your company better at what you do.

The downturn in the economy in 2009 may have hurt your business. If not, why?

Our company has seen nothing but steady growth through the downturn.

I think the reason why we have done so well in a down economy is the value proposition we offer to the small business.

When consumers aren't spending as much money on products or services, a business owner needs to bring more prospective customers to their door for the least amount of money. That's simply what we do every day.

JFSTINSO@DemocratandChronicle.com