The CEO of yellow pages publisher Dex One is accentuating the positive as he works on eliminating the negative.
Alfred Mockett isn't glossing over the Cary-based company's current struggles - "Market conditions remain challenging," he said during a conference call Monday morning. But he's also upbeat about the changes he's implementing paying off down the road.
His strategy involves cutting overall costs while investing $40 million in new technology and new ways to generate revenue - including an initiative that relies on analytics software from its corporate neighbor, SAS.
Other changes include a new in-house training academy for its 1,500-person sales force; increased bundling of an array of print, digital, mobile and social media products that it offers along with its partners; and a steady stream of new products.
The company's cost-cutting binge included eliminating 475 jobs at the end of last year and 200 jobs this year, putting it on track to cut expenses by $140 million this year. Today the company has 3,000 workers, including 400 in the Triangle.
Mockett also has overhauled senior management since he joined the company in September. "We have assembled a team with a fresh perspective," he said.
Right now, any progress is incremental.
The company, which publishes yellow pages and related digital products in 28 states, reported Monday that advertising sales declined 16.6 percent in the first quarter - slightly better than expected. The company projected that second-quarter ad sales, a leading indicator of future revenue, will decline 14 percent to 15 percent.
Mockett said that just a handful of Dex's 813 directories enjoyed higher ad sales last year, while 19 did so in the first quarter. The company expects that 100 directories this year will post higher ad sales. Publishing dates for the company's directories are staggered throughout the year.
Meanwhile, total bookings, another indicator of future revenue, are expected to start expanding in the second half of next year.
In, out of bankruptcy
Dex's core small business customers have been hit especially hard by the ailing economy, which, combined with its heavy debt and the shift away from print media, pushed it into bankruptcy in 2009. It emerged at the outset of last year, when it changed its name from R.H. Donnelley.
Dex recently started offering guaranteed results to customers in Minneapolis and Seattle after a successful test in Phoenix. The company expects to expand this sales program to its 100 largest markets by the end of 2012. The program guarantees a pre-determined number of business leads to advertisers.
"It promotes partnership and reduces perceived advertiser risk," Mockett said.
Mockett told analysts that analytics software from SAS enables Dex to predict confidently, by geography and type of business, how many leads a customer's ads will generate.
Not all customers will be offered guarantees. For example, it wouldn't make sense to offer a guaranteed number of leads to a Lamborghini dealer, company spokesman Jamie Andelman said.
Dex also is using SAS software in other ways, such as predicting customers that are "at risk" of canceling or cutting back on their advertising programs, Andelman said.
"We have tons of data," Andelman said. "They are such a great partner in terms of helping us leverage that data."
Dex shares closed Monday at $3.87 - down 33 cents. Its shares have fallen 87 percent in the past year.
