Solocal Group S.A. (LOCAL) Earnings Call Transcript & Summary

Hello. Welcome. It's a pleasure to see you all in person, even though some of you are still joining us remotely. So I'm Philippe Mellier, the new Chairman of the Board, and today is an important day for the company, the management team and the Board. In a few minutes, we'll be presenting many things, many very interesting things. I've become the Chairman of the Board 3 months ago, it was a very short vacation period. Many things have happened in the last 3 months. And I believe that, today, you will witness a solid third quarter and a clear vision for what we want to do in the future. There's a lot of quality for the work that was done in the last 3 months because they arrived just before me. So in the room today, you have the new management team and the new Chairman of the Board. The first time I intervene to present the results of the second quarter. I remind you something which is important, which is that I and Herve are pragmatists. We're not going to promise what we don't know how to deliver. In France, we're going to tell you what we're going to do, and we're going to do what we said we would. That's really the core of our operations. And today, we're going to tell you what we've been doing for the past few months. We're going to talk about the results of the third quarter and our vision for the future, and I believe that Solocal has a lot of potential in the future, which is why I became Chairman of the Board, even though at the time, it was rather difficult. I believe that, today, the nature of the issues has been well understood, and steps are being taken to ensure that most of the problems we're facing will be solved, even though it will take a little bit of time. That's what we're going to do what we said and say what we do. So beyond promises, we have acted, and I believe it's important to be judged on our actions. So this is our introduction. Olivier will be presenting the results for the third quarter. He has a lot of experience. He's going to explain where we are. And then, of course, I will be moderating the session. Thank you for your presence. We're going to try to go through this rather briskly. Transparency for our shareholders and all stakeholders is very important to us, and I believe that we'll have a few more meetings before for information. So enjoy your meeting. And Herve, you have the floor.

Thank you very much for being here, and thank you for answering our invitation for this new meeting where we published the results of the third quarter 2021. Of course, it was our choice to combine these results with a presentation of our strategic goals. As Philippe said, I joined the group 6 months ago, in the middle of the lockdown because April was a complete state of lockdown in France. So I'm very happy to meet you here in person, analysts, investors, coworkers as well. And this morning, we're going to be presenting our results but also our vision. This morning was organized around a certain number of pillars. First and foremost, I came with the management team, the executive team, and I'm going to introduce you to them. Because, as Philippe has said, all of us are very young in our respective roles. And Olivier Regnard will be presenting the figures for the third quarter 2021, then we will begin talking about our strategic orientation. I wanted to go against the current of the technological habits of Solocal by starting with the beginning, with our customers, talking about our customers and our offer, the one we are putting on offer today, the one that allows us to have commercial interactions with our clients. Then we'll go into the heart of the topic, the presentation of our strategy, our 3 strategic pillars. Of course, we will open the debate with a Q&A session. Then Olivier will join me to talk about figures surrounding our strategic goals, and then we'll talk about a second -- we'll have a second Q&A session on financials. Is that very clear? So let's get down to it. I'm going to introduce the executive team, which is -- has been around me. Some of them have been with us for a few days, over a few weeks and over a few months. If you'll allow me, I will not start in alphabetical order. I'll begin with Stéphanie, who is the most recent addition to our team. Stéphanie, welcome. And she's our CTO since the first of October. That is to say that she's very young in her role. She's dedicated a long part of her career to technological environments and system information, but she's always taking great care to have a transformational approach to her work, which is what convinced me to have her -- to invite her to the Executive Committee of Solocal, and I'm glad to have her. Maxime Videmann. Maxime is here with us. He was named on the 1st of August as the new Product and Media Marketing Director. Maxime is not a child of Solocal but almost because he joined the company 4 years ago. He already operated within the marketing team for products. And throughout this morning, you will notice that he has an in-depth knowledge of our solutions. He's an expert of technological environments, and he's a pragmatic as well. So I'm extremely happy to have him with us in the Executive Committee. Olivier Regnard, who is much more famous. He's been at Solocal for 2 years. It's a very short amount of time, but he's done a lot over the last 2 years. Olivier is our CFO, and he stops us from making any sort of mistake. And I count on him to help us in that in the future. Richard. Richard, unfortunately, is not here today. He's our Chief HR Officer, and he's been in the company for the longest. He's been there for almost 4 years. And finally, Eric. Eric Klipfel is our Deputy CEO. He's in charge of sales and customer relationship. It's the expertise in terms of managing the sales force but also in terms of customer relationship management. So this is the team, a team that's getting to know how to work together in service of a single goal, and you will see this throughout this morning. We want to grow. And now I will give the floor to Olivier, who is going to present the results of the first quarter for 2021. Olivier? You have the floor.

Hello. Thank you very much, Herve. Before we go into the universe of Solocal and we talk about the strategic goals for the next 3 years, we wanted to talk about our turnover for Q3, as usual. So a few key elements. The first is a stabilization of turnover for the second quarter in a row. At the end of Q3, we've done EUR 107 million of turnover, EUR 333 million accumulated. This means that our churn has gone down by half compared to last year. Our customer base has stabilized. Our ARPA has slightly grown compared to the 30th of June and stable compared to last year. Finally, our secured turnover at the end of the year is EUR 403 million. Finally, an important element, as Philippe highlighted, this Q3 performance allows us to confirm our EBITDA goal of EUR 120 million for the end of the year. Concerning turnover, a very major point of this performance in Q3 is that for the second time in a row, turnover is stable. As you can see in the graph above, it's -- our turnover had been going down for many, many months. And there was -- there were negative impacts with the health care crisis, and this was stabilized in Q2 and Q3 for 2021, and we expect this stability to continue. As for the rest, when it comes to turnover, there's the order intake, which has been going down since the 30th of June. For those of us who've been working with us for a long time, you know that that's a seasonal effect. So the turnover is linear over these last 3 months, but there is a lot of order intakes that go down in August. There's also the share of sales, which are subscriptions. At the end of September, it's 87% compared to 80% last year. As you might remember, we said that, at 90%, we would reach a plateau because on our large account offers, subscriptions are not possible. So 90% is our plateau, which means that, today, 9 acquisitions out of 10 are renewed automatically. The last important point, you remember our KPI for growth. I'd like to remind you what it is because it's a bit complicated. It's our secured turnover over the next 12 months compared to our sales on the quarter, and this KPI is going up by 11%. The final KPI is our secure turnover. What is secured turnover? It's the turnover we would have if there were no sales between the 1st of October and the 31st of December, which is rather unlikely and if none of the contracts that should be renewed between the 1st of October and the 31st of December was renewed. So if nothing happens at all, the turnover will be at least EUR 403 million. Why did we introduce this KPI? So you can better appreciate our lending in terms of turnover at the end of the year. This KPI is slightly lower than last year. Why is it -- why is there a change? There's 2 effects. First of all, we're digesting the effects of COVID because in 2020, the 3 months of COVID had a very negative impact on the group. So we're digesting in terms of turnover. We're still recovering from the effects. And there's also -- it might be a virtuous effect. Maybe that's counterintuitive, but we hadn't transferred most of our contracts in subscription last year, so we are still registering orders before the renewal of the contract, which is no longer the case. So we have a mechanic minus EUR 10 million linked to the fact that contracts today are going to be renewed between the 1st of October and the 30th of December, whereas, in the past, there was -- members of our sales force that had to renew that contract and spend time and effort on that. So this secured turnover is EUR 403 million, if nothing else happens between now and the end of the year. So let's go back to the performance by segment. We have 3 types of products. The first is Connect, which is a digital storefront. Its presence is growing compared to last year. Why does it have this strong growth? Because our clients need more and more to be visible on the web. Second activity, Websites. As you might remember, we have the largest web factory in France with 300 people in Angoulême. The turnover for the Websites is down 7% compared to last year. Those who have been with us for a long time remember that, last year, there was a favorable seasonal effect. And the performance is actually stable compared to what it was 2 years ago. Finally, the Booster segment is our digital advertising product, and it's going minus 10% compared to last year. And our clients have -- this is because our clients have found it difficult during COVID to invest in advertising. And one of the things we're going to focus on is that segment today in our presentations. Our customer base has been stabilized for a year now. On the 30th of September, we have 311,000 customers, which is slightly less than June because there was an acquisition, and also because there's been a very positive churn effect with almost 50% less churn compared to last year. So how did we reduce the churn? There's nothing magical. As you remember, we focused a lot on keeping our customers with dedicated teams to reducing churn. We managed to maintain more than half our customers now. The challenge now is to maintain the value of each customer. So that's another challenge. How do we protect our ARPA. Speaking of ARPA, ARPA is stable. It's in slight growth compared to the 30th of June. So what is ARPA? It's the turnover by customer. So before I give the floor back to Herve, I think you have to remember, before we talk about strategy, 2 main aspects. First of all, of the growth of our turnover. And second of all, we are confirming our EBITDA guidance objective of EUR 120 million at the end of 2021.

Thank you, Olivier. So as you've seen, the results are encouraging. This third quarter shows that we can stabilize our top line. It's now obvious that we have to go look for growth. As I was saying earlier, looking for growth is, first and foremost, understanding our customer base. We have to profile who our customers are. And we also have to appreciate the appetite of our customers for the offer we are presenting to them today, which is why I would like to invite Maxime to join me here to start a first chapter, which is going to be the customer chapter. We're going to talk about our customers and our offer. So let's talk about our clients. Who are they? And what universe do they work in? The first lesson, our customer, for 90% of them, are companies with less than 10 employees. We are clearly positioned on the smallest segment of small-sized companies, which is what we call in France very small-sized companies. That's the first takeaway. The second takeaway is that, as you can see, our client portfolio is rather balanced. Every segment is represented in Solocal in large amounts. However, when we analyze value, we can see discrepancies. We can see, first and foremost, that housing, while only 28% of our customer base, represents over 36% of our turnover. So there are strong monetization effects, which are very different, depending on the segments we are addressing. As you can see here, the 2 most important segments in terms of monetization for Solocal are housing and services. I will come back to that later. Who are they? And where do they live? And there's no surprise here. Our territory is, first and foremost, peri-urban areas and rural areas. The capacity of our commercial network shows its strength here. We are overrepresented in small cities and rural environments. The counterpart of that, of course, is that we are less present in large urban areas, the largest urban areas. Another question we've asked ourselves. What is the profile of our professionals? They are young companies. Are they anchored in the local economy or not? And we're talking -- and what we've seen is that we're working essentially for companies that are well implanted in the local economy, the regional economy. And they've been active for 6 to 20 years. So these are people who are set up, who want to continue to develop their business and who are resilient economically speaking. So I would like to add to this that since the 1st of January 2021, we've developed an acquisition strategy which is much more active. And what we've started to observe is that since the start of the year, over 40% of our customers are younger companies with less than a year of existence. So we are looking for a new branch in our portfolio which is going to allow us probably to grow over the next few months and the next few years. All of these are facts. These are things we've observed. The only question that we've asked ourselves within the COMEX is what are the needs? Did we listen to these customers properly? And did we hear the responses? So we've relied on 2 studies, a study in 2020 and one in 2021, relatively recent. What do they teach us? First and foremost is that Internet for these professionals is central. It's not a surprise. What is a surprise is how they translate that into their activity and why they consider it to be central. Of course, they consider it central for visibility. This is the core of the engine for the offers of Solocal. But not only they consider Internet to be essential to operate and interact with their own customers because the world is changing, because consumers more and more want to interact with professionals digitally. So there is no other option anymore. The digital aspect is now central to the sales activity of all our customers. Is this new? Yes, it's new, but it's not the only thing that's new. There's also a third thing that is new. These professionals have administrative work to do. They have financial and economic work to do. They have to manage financial flows, which, themselves, are becoming digitalized. And the further stage of the rocket is that these professionals -- for these professionals, we cover these tasks which are considered by them to be very time-consuming. This is very important for us. The second lesson of the study is the digital -- is that these professionals are becoming more and more accustomed to the digital world because of the COVID crisis,which has made our customers aware of the fact that Internet was going to become absolutely essential. That doesn't mean that the Internet is not scary to our customers, and that's why we will see that our mission, the mission of Solocal is not only to provide digital solutions. It's to help our customers use them in the best possible conditions. So to sum it up, a client portfolio made mostly of small-sized companies, very small-sized companies, very strong activity in housing and services, customers who are well anchored in the local economy and have been there for many years who are especially present in rural areas and small cities. I'm referring to customers who may not be as digitally advanced as they wish. So what do they expect from us? Better visibility, obviously, and that's our trademark. That's the promise we make to them. That's what we pledge. And also, they expect us to help them grow their business. What do they care about those customers? They want us to help them grow their business significantly. But most importantly, they're afraid of the digital transition. They dread it, which is why they're looking for service providers that can provide them with solutions, solutions that will help them rely on our expertise, to ensure continuity of business under the best possible circumstances. So that's about what I wanted to say to you about our customer base. I'll get back to it later because that's clearly the guiding thread behind our strategic priorities. Maxime, go ahead.

Thank you, Herve. Good morning, one and all. As Herve rightly explained, this is our value proposition. Our value proposition has been built to meet customer expectations. Our customers are professionals, and they want to use the Internet to increase their visibility and grow their business. So our value proposition is based on 3 different priorities, 3 different pillars. Number one, we are here to help professionals manage their brand, their reputation, their information to help them interact with consumers around them via top websites that enjoy high viewership, social media, such as Instagram or Facebook and also the Yellow Pages. These are legacy websites and also a lot of partner websites that have a lot of visibility. So we are here to help our customers better manage their image, their reputation, increase the visibility and promote their business, so they can create their own showcase in their own name, a customized showcase that will enjoy visibility online. Basically, a website that looks like them, that's our core value proposition. And third aspect, our ability to help customers use the Internet jungle to convert their investments into actual leads, into actual prospects, into actual tangible business. So that's our third pillar. It's based on digital advertising. It relies on our expertise when it comes to social media and all search engines. So all of the investments that they make on a monthly basis has to be converted into actual business, actual revenue. So we provide a whole range of solutions to our customers, and we wanted to make sure this range of products and services would be as accessible, as eligible, as understandable as possible. So when we released revenue for Q3, we decided to organize our ranges as follows, so 3 different ranges with a single interface that customers can use to manage all of their information, their addresses, timetables and use, the day's menu, if we're talking about a restaurant, their prices, their promos, et cetera. All of their daily activities can be managed using a single interface. And that's exactly where those local consumers are located, consumers that want the business that our customers provide. So that's the Connect range of services, starting at EUR 29 a month. Now the website is a showcase for the customer. It is customized. It's an opportunity for the customer to achieve priority ranking, to be among the first 2 hits when a consumer queries the Internet and looks for something specific. So our offer starts at EUR 70 a month, and we use digital advertising on search engines. This is what we call SEA, search engine ads. We also use a social -- or rather social media so that these investments can be turned into actual leads, actual prospects, actual business. So this range of services that we provide on a daily basis to our customers is operated with our production teams, and those solutions are available via all of our commercial channels simply and accessibly. Again, our professional customers may not be tech-savvy, digital-savvy, so we make it as easy for them as we can. So more specifically, what kind of value add do we provide? At the end of the day, nothing replaces a demo. I hope technology doesn't let us down. But I'd like to explain to you to what extent Solocal can help business customers grow their business and access more consumers, more clients that are looking for those specific services and products. So what does this mean from a tangible perspective? Let me show you. Now I have a computer here. Can we please connect it? Wonderful. Now I don't want to be chauvinistic, and I don't want to use a French website. Let's use Google instead. Google is global. So let's simulate an interaction. I'm not going to use a basic example. Obviously, if you're looking for a piece of bread, you know where the closest baker is. You don't need to go online for that. But for involving activities, rarer activities, for example, housing, you need information for that to go online. So if you Google something a little less conventional, for example, paint job. You want to give your house a fresh coat of paint or you need a new roof. That's not something you do every day, and so business consumers -- or rather business customers really need more visibility. So if you type paint job, ravalement de façade in French. And you add the name of the city because you want local providers, this is what to get. And we highlight the different offers. So at the top, what do you see? A PJ link. PJ for PagesJaunes, Yellow Pages. So thanks to Solocal, you increase the visibility. You manage your information. You rank among the top hits. Now there's about 10-or-so hits on the first page, and this accounts for maybe 10% to 90% of all clicks. Usually, most French consumers stick to the first page, which is why it's important to rank among the first hits. And then if you scroll down, you'll find other websites. And this requires expertise in terms of SEO, search engine optimization. How do you emerge from the mass on the Internet? Well, you need to know how to, and that's the expertise we provide. So not only we give them a website that looks like them, it's customized, and it's got features that help them interact with their own consumers, with their own prospects. But we also help them with priority ranking, so they will be more visible vis-a-vis consumers. So they will rank among the first hits. So I don't particularly know this one, but this is a Solocal website. The second one, Pierre Millaud, is also a Solocal website. If I scroll down a little further, Messent, that's another Solocal customer. This professional trusted us with designing their website. And here again, and here again. Now this is a paying Google ad that's called SEA, search engine advertising. That's different than SEO. And in pink, well, those are business customers that we help use Google tools, so they can achieve priority ranking on Google, so they can have more visibility vis-a-vis consumers. It's as simple as that. Those are the solutions we provide to our business customers, increase their visibility vis-a-vis their own natural pool of clients. Thanks to our digital tools, they get to improve their visibility. And their conversion rate improves, and they're able to turn the Internet into an actual sales tool. Now I'm going to ask the tech team to please display the presentation again. Thank you. Well, thank you for that excellent question. Let me rephrase it. Regarding the right-hand side of the previous screen, going back to Google, please. On the right-hand side, this is a content called Google My Business. It's a local page. So how do you administer this local page? What we call a viewership juncture. Well, you need to manage that information. You need to manage the content. You need to respond to posts, opinions, photos, timetables, prices, offers of services, and that's exactly what our Connect range of solutions provides. Customers get to manage all of that via our solution. They enjoy priority ranking. Even though I didn't have their name, this professional use the right algorithms. They provided as much information as possible, information that is of interest to Google users. So why do they show up here instead of elsewhere? Because they use the tools that we make available to them. They enriched their own information, and they provided as many answers as possible to Google users who are looking for something specific, something specific like a paint job in Poitiers. Now I could have used paint job. I could have used other examples in other cities. The approach is exactly the same. I use Google as an example, but I could have used PJ, PagesJaunes, Yellow Pages. 50% of the French population uses the Yellow Pages in France to look for professional services every single month, and I could have used another social media. The rationale is exactly the same. Intermediation, priority intermediation between our consumers who want -- who are looking for a local service provider and a business that is looking to increase its visibility and is looking for local customers. Thank you. Back to the presentation, please. At the end of the day, a picture is louder than words. And this is a perfect example of what things are like for a business customer that is looking for either a website or wants to use our platform to manage all of their information on a search engine or maybe even rely on our digital advertising expertise to reach out to their consumers more. Now getting back to our Booster range of services. What does this look like from the point of view of a business that enters into a partnership agreement with Solocal? [Presentation]

There you go. So one of our challenges in terms of meeting customer needs is to streamline this whole universe, which is rather complex and sophisticated, to make digital technology more accessible to all of our customers, be they storekeepers, beer businesses, self-employed trades, B2B players who may not have that digital expertise, may not have the time to gain ownership of all these tools, which are truly powerful and can help them develop, grow their business online. Herve, back to you.

Thank you, Maxime. Stay with me. Sorry for the navel gazing, but this is what we're seeing at customer level. These are the offers that we provide on the market. Together with Maxime, this is what I suggest. Let's open up our chakras. Let us branch out. Let's stop focusing on Solocal and instead focus on the competitive environment in which we operate. We have selected advertising investments in France as a relevant indicator. So that's a starting point. Advertising, whether off-line or online or mass media or multimedia advertising investment accounts for EUR 29 billion a year. And iteratively, we have decided to try and circumscribe the market in which Solocal operates relevantly, more specifically, the local digital markets. Now by local, I mean we cater to very small enterprises, VSEs, as well as PMEs -- or rather SMEs, small- and medium-sized enterprises. And so this market has been sized at about EUR 3 billion. Now compared with that EUR 3 billion market, we have about 15% market share. So 15% market share, what does this mean for Solocal? Well, we have decided to pursue our analysis of our own revenue portfolio. We've decided to continue to map things out, and this is what I want to show you. See the horizontal and the vertical axes. What have we done? Here, you find a number of businesses that have signed up to our Yellow Pages website. And on the vertical axis, you see the average revenue per account per segment. So housing is the #1 market. This comes as no surprise, 17% penetration rate, which is pretty good. But most importantly, monetization is excellent. ARPA is about EUR 1,700 a year. You will notice the same trend for services. The purple bubble. Penetration rate, 11%, and ARPA is rather satisfactory. Monetization is pretty good. However, and that's the bad news, as you can see, those 2 market segments do not have the highest potential. The highest potential markets are retail and B2B, business to business. So this begs the question, what are the key success factors? What are the criteria, the requirements for monetizing our different market segments? Well, you can see this coming from a mile away. Now language behavior, digital acclamation, the need to outsource, all of these aspects, all of these aspects will probably cause us to decide to invest in particular market segment, such as B2B. Now I don't want to spread myself too thin. Instead, I would rather focus my strategy on high potential market segments, the most attractive businesses in Solocal's current offer. So this is our revenue portfolio as it stands today. This is how we map things out. This is how we ensure traceability over the next few days, weeks and months. Now obviously, offering beyond the market. Together with Maxime, we wanted to share with you our vision of the competitive landscape, more specifically, Solocal's current position within the landscape, within that competitive environment. Over to you.

Thank you. Now it's a competitive landscape indeed, and it's complex. It's difficult to manage because the competition comes in different sizes and shapes. People often ask us who our local competitors are. Can you give us names? Who is your main competitor? Honestly, it's difficult to come up with just one name. So we decided to segment our market. To make it easier to understand, there are 4 different types of stakeholders that constitute competitors for Solocal. So in green, on this slide, you see highly specialized SaaS players, so software as a service, and to provide platforms for all businesses and their go-to-market is rather generic. Now the markets that they address is rather generic, but the value proposition is rather specialized. For example, websites or drive to store or digital advertising or presence management. So they specialize in a special kind of service, and the service is based on a platform. So they haven't grown much yet, but it is a type of competition. And then you have the blue ones, the blue competitors, the web and media agencies, digital media agencies. And some of them can be highly local, small in size, but they do have a strong presence in their own catchment areas or they can be nationwide players that are well known and that address the entire country. And their range of solutions may be a little broader than the SaaS players that I just talked about. They look at the entire market. And we're closer to those people, even though our value proposition has become much broader in recent years. And then you have big tech web giants. They're part of that competitive landscape. Even though we are tapping into their power, their technical content, their level of sophistication are the basis for their excellent performance. Google has highly technical content, very sophisticated algorithms, and that's a barrier to entry for other players. And so they need players, such as Solocal, because we help them go the extra mile. We help them do the final stretch. We help them go local. And then there's a fourth type of players that have a slightly different approach, a more vertical approach to the market. The expertise they provide is highly specific. It looks at one specific business, one specific area of activity. It's a very specific value proposition. So that's our competitive landscape. And as you can see, the different players come in all shapes and sizes, different players, different sizes. And the biggest player in France in terms of revenue -- well, it's important to look at revenue, and it's important to look at French leadership. And the fact that we're #1 gives us additional strength. It gives us higher visibility, and it puts us in a better position to leverage existing market trends, so we can keep our competitors on our radar. Now how do you stand apart from the competition? How do you stand out? Well, let me look at our various assets. What is it that makes us unique? What is it that makes us different than the competition? Let me try and summarize the value proposition from a product point of view, a technology point of view. There are 3 different aspects that are very important, so you'll truly understand our potential. And this is the message we sent out to customers. Number one, we have an ability to use and leverage data and information on the entire market. That's unique to us. The data we manage is rich. We manage it at a very large scale. In addition to having that insight into the market, we have the ability to disseminate that information. On "viewership junctures" that are specific to us, for example, PagesJaunes, the Yellow Pages. But we also have a number of partner websites, a whole network, an exclusive network. So if you want an online presence today, if you want to manage information pertaining to your own business or whether on Yahoo!, Mappy or Bing, you need to go through us. There's no other way. So we have exhaustive data on all businesses on the French market. That's our first asset. Asset #2, and my demo earlier kind of touched upon that. We have expertise in Google algorithms but mostly Google algorithms, and this provides us with total control and excellent SEO. The website landscape is an extremely competitive environment and the ability to make sure that the websites redesign perform well and therefore highly visible vis-a-vis consumers. This is highly time-consuming. The technology content is significant. It takes a lot of time and a lot of technology to develop it, but we have the track record. And we're able to ensure priority ranking for a flower shop in the south of France or a cycling store in Normandy or a plumber's website in Léon. So we have a highly generic but also customized approach based on the business' specific needs and local priorities, so we can ensure priority ranking in all our tools. So that's a unique asset that we provide. And lastly, there's a third point, and that's the other unique feature of our offering. So we used to be a hard copy directory, and now we have the ability to provide unique, proprietary, multi-sourcing search engine ads algorithms. So -- and we cover all search engines on the market, including PJ, including Yellow Pages. So that's the first aspect. And secondly, our expertise, our ability to provide that highly local technical content. In other words, we are able to ensure high granularity in terms of keywords. We have a local approach to a specific catchment area for businesses that will work only in specific areas or medium-sized cities or towns. It's also a rare expertise, a unique expertise that we developed, given our history on PagesJaunes we've adapted to all search engines. So these 3 technological aspects are what differentiate us.

So finally, what did we learn? What did we learn during these surveys, this analysis of the competition in the market? Well, the first takeaway is that the SaaS is probably the best way to satisfy our customers. All of the SaaS players today answered the needs of our customers. This is convenient because we are a SaaS player. But a SaaS player has rights but also obligations. What we learned during this analysis is that the SaaS mode induces a follow-up and a client support which is very tight. And so it's very important to associate an investment in the client relationship, which is very strong, along with our model. That's the first lesson. The second lesson is the digital transformation. It's something we have to help our clients with because it's something they're scared about, often because they're a bit ignorant of these things and also because the degree of investment, which is required in terms of digital transformation has to be transparent, and it has to show capacity for return on investment. And I'm not sure that Solocal highlights that enough. Maxime presented products. I believe these products are excellent on the French market. However, I believe we don't say that enough. Reporting, dashboarding, reassurance, daily reassurance of the professional on his investments, his digital investments has to become inherent to our DNA. Finally, the third takeaway that we've observed is the inducers of intermediation. Our goal is to create a contact between our clients and their customers. This role as a middleman induces an obligation, and we have to create an environment where trust is possible. This environment of trust is the main and primary factor for work as a middleman. Trust, you're going to hear about that a lot in the following minutes because it is something I consider to be absolutely crucial if Solocal is to renew its growth. So thanks to this analysis, thanks to these observations. We're now going to tell you what our strategic road map for 2023 and 2024 is. But before we talk about that, I'd like to share a few things I am convinced about at this point. As I've said, [indiscernible] [ our President ] has said, we want to renew with growth. Many members of the execom have joined Solocal with this goal in mind. And the first thing I'm convinced about is that we will not manage to grow if we don't reinforce our base. What is our base? We have a real footing, but we have to reinforce ourselves technologically when it comes to our client relationship and when it comes to sales. So this strategic plan has 2 stepping stones. The first is to grow by answering our internal challenges. And the second, we know where we want to go. If we manage to reach this first milestone, then we will have the possibility of moving forward, and I'll come back to that a bit later. During this presentation, you'll hear 2 words a lot, execution and trust. Why? Well, first of all, because the first pillar of our strategy is the execution of the go-to-market. Using the bricks of Solocal coherently. The presales brick, the technological block, the after-sale block, the customer success block, all of these must be put together and form a whole. And this is a true challenge at Solocal today. We have to implement our go-to-market so that our clients are not lost so that they're satisfied, so that they're happy to work with us. Eric will soon present what we've imagined, what we've started set up in terms of go-to-market. The second element is rebuilding trust at every level. Trust between Solocal and our clients. What are the implications? First and foremost, an entry point and a follow-up point for managing the doubts of the customer, which means that we need to review some of our solutions so that they are even more robust and efficient. And Maxime will be talking about that as well. So we are very clear when it comes to our road map. Finally, if we are successful in that regard, and only if we are successful with that milestone, we will move forward into the future. Why? Because today, we have a historical positioning in terms of digital presence, in terms of advertising on the web and in terms of being a digital storefront for our clients. So all of this is very oriented towards the development of business. I believe that Solocal has the means to answer other needs, other tasks, administrative work that the professional has to manage, in terms of financial flows, in terms of billing. All of this has to be managed by our clients. As we work on these issues, this has to become our core business. These 3 elements are going to be what we discuss in the future. And for that, I would like to give the floor to Eric for the first part.

Hello. It's Eric Klipfel. I'm going to be doing the execution. So we talked a lot about market -- marketing. You've seen this demonstration, which was very convincing. Now I'm going to talk on the basis of technology and maybe the most complex variable in technology is the human being. I have dozens of people in my teams motivated, committed. And the hardest part of the work is probably to convince them, to motivate them, to participate in this growth. So it can sound banal, it can sound mundane, but it's vital to motivate all these people towards the goal of growth. So these are the 4 cornerstones of our strategy. When I was going through training, I was often told that performance is a combination of many factors, and these are the factors we've decided to choose as the cornerstone. The first one is performance management. What does performance management mean? It's for us to manage, to motivate the best people, make them want to be there. Second is understanding our environment, our local environment. Local first is part of our strategy. And we're going to talk about commercial coverage in this part. So the right salesperson in the right place at the right time. The third cornerstone is training. We can have a change management program because that's really what we're doing here. Herve, as you were saying, we've been coming from years where client acquisition was not our priority. All our salespeople were working on a listing, a client portfolio. They weren't looking at potential clients that were right next to the ones they were already visiting. And this change management is going to go along with training, dedicated training programs, dedicated training offers. And finally, because we're smart and because we're good at marketing, we've also worked on enhancing sales tools for our own sales force, for the business as well, but if the salesperson is the -- and if the client relationship are the pillars for executing this strategy, we have to support them with more modern tools. These salespeople are spread into 2 segments as of now. In pink, large clients, our large networks and in blue, small-sized and very small-sized companies, so those are the markets we talked about earlier. For the small and very small-sized company, we have 2 teams. We have physical salespeople who are in the field, and there's 400 of them. And then there's telesales. They have the same customer relationship, but with on a different market segment with lower ARPAs. I'm going to talk about the large accounts first. In 2022, on large accounts, our ongoing strategy is -- our strategy is ongoing, which is it means that we want to keep as many customers as possible. We want to -- and I still need my salespeople to migrate the accounts, the previous offers to our current offers. We cannot tacitly renew them as of yet as we're doing on the medium, small-sized company segment. So we're looking at a more conservative strategy, not a growth strategy just yet, to benefit from opportunities that we may find, for instance, on the network sectors, so companies that have over 100 sales points. So these are -- it's an ongoing plus strategy where we do try to look for growth in such segments of the market. If we come back to the small and medium-sized company segment, I'm going to talk about number 2, telesales. In telesales, we took the right strategic orientation last year -- at the start of last year because on the basis of our understanding of customers with our huge database, we oriented our telesales people on very simple strategies, very simple actions, and they obtained a very positive transformation result with that. And our client portfolio is over 300,000 customers and over 200,000 are in the telesales. And these 300 salespeople in telesales have been doing that. So this confirms that we have a good commercial strength that we've kept and accelerated for 2022. And this will allow us to improve our coverage in the field in France because France is a large country, and we aren't necessarily always present in very large city, as you mentioned earlier. We're present elsewhere. But sometimes, if we want to cover a region where there aren't a lot of inhabitants, it may not be very interesting economically. And we're going to do it starting in 2022 with telesales, which are going to cover our dead zones with new systems, new offers, and they're going to reassure the same approach for contact with the customer. Of course, work in the field, I would say that diagnosis is not as positive. It's not alarming. But clearly, today, this channel is 50% of sales, and we were hoping for more, we were hoping for 60% of sales coming from field sales. And this sales channel is where growth is going to come from in 2022. This sales channel and the treatment of the 3 main pain points, which you can see on the slide, performance management, which means transforming the teams from a model which was a 2015-2020 model towards a 2022-2024 model, which is much more based on growth. We are going to change and adapt our pay plan, which dates back from 2014, it was adapted in 2019 and it's based on subscription. 90% of our accounts today are renewed automatically. Before, it used to be the salesperson who did that. He doesn't do it anymore. So now he has more time, which is going to be dedicated to conquest. And we're going to adapt the pay plan to that. And finally, we want better coverage locally to better -- by better working on the geography of different regions. So when we're talking about sales coverage, we also talk about managerial coverage. Of course, the leadership isn't going to win the war in the field, the soldiers are. But you need the leadership to give a clear direction. Our first step, which was also launched this year will be to reinforce our commercial team, which was incomplete. It will be complete on the 1st of January 2022. A new commercial director will join us and 3 new regional directors, which will allow us to work on the basis of stable teams. The third measure is -- goes hand-in-hand with the first one. And it's a real trio with management, HR and training, which is going to allow us to conquer the market. Without this trio, we won't be able to have all the skills we need in every region to properly execute this plan. We have to guarantee these basics. I know it's simple, but we have to do it. And the second point is to change what's going to happen in 2022 compared to the previous year. And we have the project of modifying our pay plan in 2022 and completely synchronize it with the strategy of the company. So of course, now we're talking about real matters. This is France. The first change in 2021 -- 2022 compared to 2021, sorry, is that we are going to intensify our sales approach. We were in 5 regions in 2021. 2022, we're going to move to 6 regions, which you can recognize here with the colors. These 6 regions, of course, are going to have a local-first strategy implemented. So local first means digital, but it's also a unique strength because we are the last mile. Our competitive advantage is that we are the last mile between all the actors that you've seen earlier. And the real difference is that we go all the way to shake the hand of the entrepreneur who has a construction company. And this is really the difference. This is really what makes us different from our competition, beyond even performance of our offers. And this is what we highlight in our go-to-market. When a craftsman shakes your hand and says yes, he looks at you in the eye and he tells you, "I trust you. I trust Solocal." But maybe he's already forgotten the offer he's subscribed to. He's probably forgotten it, but he hasn't forgotten the handshake. You've all done business with craftsmen, and you know that when there's a handshake, that means there's trust, and that trust goes both ways. And this craftsman is going to recommend you later on. That's what this trust means. To cover the main cities in our regions and the white zones I talked about earlier, we're going to rely on the existing field sales force. And we've dedicated 230 salespeople who we've called farmers, developers, and their mission is going to be -- to spend 50% of their time following the client listing and developing it, not renew it, but develop new products to go with the ones they already have. And the other half of their work is going to be conquering new clients who live around those that they already advised. To go faster, we're going to increase our hunter strike force. This is a team of salespeople, which is 100% dedicated to conquering new clients. So we're going to go to 100 to 140 new salespeople. So 140 hunters, dedicated 140% plus half of the farm -- 230 farmers, you can see that 60% of our commercial time is going to be dedicated purely to creating new clients for ourselves in 2022. Why can we do that? Because we're at 8% penetration in certain areas. And if out of 100 entrepreneurs, we have only 8 of them, we can use these 8 for recommendations, but we can go see the 92 others. And I'm sure that a few of them will join us after the demonstration and will want to see us again. 3 regions out of the 6 have already very well developed this model, but not all 6, which explains part of our performance in 2020. The regions have commercial teams, which are well organized along the lines of the model I've just explained. I'm going to give you an example with the Southwest region. This is not the only region. But the example of the Southwest region is quite telling. And we're going to talk about what the ideal performance pack is for a region. So the ideal performance part for a region is a rate of salespeople who do what the strategy says, so an onboarding of the sales force, which is close to 100%. We're not quite there yet, but we're already at 80% in the Southwest, which means that 80% of the staff of the company in this region do at least 1 new customer a week. They have that reflex. It's going to seem very casual to you once more. But we're coming from 0.3. So if you multiply this number by 3 in 6 months, the goal is 2 -- about 2 per salesperson. That's for 2022-2023. The second thing that's part of this ideal performance pack for a region is hunters and the activity of these hunters. Their job is very clearly to conquer new clients in the field, not with the phone, but with this famous handshake that I've talked about earlier. Their goal is 3 new customers, 3.2 new customers weekly with EUR 1,600 of ARPA. They have to create EUR 5,000 of new business per week. This is the goal for all salespeople. Whether they're farmers or hunters, they have to create EUR 5,000 of new revenue per week. Is this difficult? Well, you've seen our gamut of offer. Website is EUR 72 per month and 72 x 12 is not enough. So you need local incentives, you need local management to motivate their workforce to work on ARPA, which we want to have around EUR 1,500, EUR 1,600. So what are we talking about? We're talking about a premium website. We're talking about a booster contact, and it's other types of premium products. We have the offers to allow you to make these EUR 5,000 of sales a week. It's completely possible. It's change management, and we have to move our teams towards this goal. Now we're going to talk about the training program. I told you that we had to work on it once more. There are things that exist already. E-learning, professional training, all of this exists. But why do I insist on training so much within change management? Because where we come from, we didn't -- we did commercial work differently. We only went to the file. We didn't go to see elsewhere. And we want to train our sales force to work on return on investment on a benefit versus risk ratios. And it's not by talking about complicated English terms to them that you're going to onboard them. And you're not going to onboard a craftsman with that as well. We have to tell them you're going to invest EUR 1,500. With 3 new contacts, you can renew your yearly investment. Look at your colleagues in [ Poitiers ], they've put a little more money, they've had a little more contacts. Maybe you'll be able to pay for a new coworker as well. And this is the work we need to do with our clients so that they have better performance on these topics. And finally, and this is probably the most important point in the training program, it's working with the new salespeople. Our new sales force, which is very efficient, which is very competent immediately because they look at the offers. They look at the return on investment tables. They know it's possible and they don't have doubts about the reputation of the company, et cetera. These new salespeople are accelerators for a business conquest. So we have to give them 6 months when they arrive. We need to give them programs for buddy coaching so that they can go. And after 6 months, we can leave them alone on their sector. The final cornerstone of the strategy, the tools, client data and sales support. So I often tell my salespeople that they're allowed to be a little lazy if they're very, very smart. So I know that lazy is bad, but for a salesperson, the key of his work is optimizing time, optimizing every single meeting so that every meeting allows you to position the best offer and the best spot for the best client. Optimizing your time is exactly what the contact plan we're going to give them is going to propose. Optimizing time is also optimizing the time you spend going towards a customer to see them. So sometimes you're going to take your car to go to [ Gif-sur-Yvette ] or [ Saint-Maur-des-Fossés ] because it's far away. And there, there's a craftsman who is going to trust us for EUR 7,000 or EUR 8,000 a month. So when we go there, well, it's 30 minutes there and 30 minutes back, so first, we've got -- what we've designed, first of all, is a machine to qualify leads and also a very simple tool, which is called Salesforce Maps, which is [ an around me ] map. When you get to the customer in Poitiers or [ Saint-Maur-des-Fossés ], you open Salesforce Maps and Salesforce Maps tells you, "Well, if you go to 2, it's 20 minutes away and you can see 3 people. If you go in 2, there's 2 clients that are in your portfolio that you can visit as well." So optimizing time is also an opportunity for them to be lazy, but lazy and clever. But these leads that we're going to give them are very precious because they are enriched leads. They've been worked on. We've invested money to have these leads. So being clever is also working on them quickly because these leads have value, and this value goes down over time. So if there was a lead in our process we'll give them away because it's an investment that we've made, and we're going to process those leads no matter what. So much for part 1. Performing our go-to-market strategy. It's run of the mill, it's boilerplate, I know, but it's essential for fostering trust. Now priority #2 in our strategy. As we all know, in business, confidence is key. Trust is a new must. I'd like to say that because when you operate in a climate of trust, then you operate differently, you do things differently. And the customer care department is always the busiest. Usually, when people call, it's not to congratulate the team. It's because there's a problem. So they're busy all the time. And in 2021, I do believe that we have brought up to scratch the Solocal customer care department. I know things aren't perfect, but we're doing much better. We respond to the phone right away. We are reachable 24/7. Up until recently, close of day was at 5 p.m. Not anymore. And we are reachable online 24/7, thanks to Solocal Manager. Now obviously, you will retort that this is only fair. But without that foundation, you can't move on to the next step. You can't move up to stage 2 of the rocket ship. And our customer relationships are based on 6 different criteria. Number one, new business is key. The first 100 days of a customer's life working together with us are absolutely sacred, absolutely essential. Only then can they create value. Remember, we want to base our value creation on trust, on confidence. We have to give 200% for the next -- over the first 100 days. That's foundational. And we have programs to that effect. And so we will be proactive and call every single new customer during that first 100-day period. Whether or not they're happy, it doesn't matter. We'll say hello again. We'll say welcome again. And maybe then we will detect their needs. Maybe there's something they don't understand, and we provide them with the support they need. And that's where CCMs come in, customer care managers. They provide that support, and they have an obligation to process the customer complaint from A to Z, from beginning to end. They cannot pass on the hot potato. They are the single point of contact for the customer. Thirdly, obviously, we ensure regular product checks. That's where CSMs come in, customer success managers. They have statistics. They explain those statistics. And in so doing, they may suggest improvements. You can do so much better. How about this additional offer, et cetera? Maybe you want to try this new booster and accelerate your sales for a given period of time. It's part of our customer development work. And that's where customer success managers come in. Sometimes we call customers and ask them how are you doing. Maybe they'll say, "Not so good." It happens. So customer care managers are here to take care of their customers. And the statistics we get from marketing are useful in terms of our prevention campaigns. Out of our 300,000 customers, we have identified those customers who subscribed for a particular website, at this particular price, at this particular date. Generally, they've called the call center complaining about this particular feature, et cetera. So we use artificial intelligence to manage problems before they even emerge, identify problems ahead of time among specific customer demographics. And when there is no other choice and things are not going well, we have customer retention teams. And they already exist. They're working really well already. We have reduced our churn rate quite a bit because the customer retention teams are so effective. And they will continue to do the work. So much for the 6 steps in our process. And I'll will wrap up my presentation with a very simple slide. It's a simple slide, but we love it. Obviously, this is no revelation here. But you see the top 6 steps, plus the seventh step, the sale, the actual sale. So yellow means the human touch points. These are the moments of truth. And for every single milestone, it's a moment of truth. So we're going to appreciate them, measure them. We are going to measure customer satisfaction at every human touch point. So we have new enablers to do that. For example, speech analytics. Every conversation is analyzed and leads to interaction. So we'll know what's going on. We analyze the words. Even the not-so-obvious words, what comes out to the customers emotion. And if that emotion is not a positive one, we'll call them back. We'll try to understand why. That's what we want to do for 2022. We want to take over and revamp our customer portfolio and base it on trust. Now Solocal Manager is our digital wizard. It's a marketing tool, yes. But it's also a CRM tool, and we developed that for every moment of truth, every human touch point. So you have CSMs, customer success managers. We have salespeople, whether in the field or telesales. And then we have the digital wizard, Solocal Manager. And we have a whole range of technologies that we use to measure what's going on and know exactly what's going on at a given point in time. And I will wrap up my presentation with a quick video. Everybody seems to have their own videos these days. And this is the head of our webfactory located in Angoulême, and we have a customer relationship team there. Thibaut, over to you. [Presentation]

So it's a perfect mix, a perfect mixture of technology and the human factor. This is how we build trust. This is how we fast track our road map. On the technology side, how can you develop trust Unless that trust is long-standing, sustainable? The trust was the first time when they subscribe to our offer. They become customers, they believe in our performance. They believe in our ability to provide return on investment. These are essential aspects, essential components of what -- of the value proposition. And these are aspects in which we're going to continue to invest so we can shore up that trust. First of all, ROI, return on investment. Here is an advertising campaign. And the price per contact is key in terms of ROI. If they make an investment every month and they perform well in terms of contacts, but it happens to be too expensive or the conversion rate isn't high enough or the quality level isn't high enough, they won't come back and they won't trust us sustainably over the long term. So it's important to make adjustments, adjustments to our prices, adjustment to the performance of our advertising campaigns. We need to make those adjustments based on seasonality, the need to fast track the road map from time to time. Sometimes they may need to slow down. Maybe they have too much on their plate so they need to slow down. We need that kind of flexibility. We need to adapt to their primary needs. We will continue to invest into that priority, particularly on the advertising side of things. Secondly, we want to make things more simple, make the platforms more simple. We said that several times. We're addressing a market that wants support. They want assistance. They don't have the time to take an interest in the technologies. They want turnkey solutions. They don't have the time to become experts in digital technologies. So simplicity is key. Our tools, our platforms that we make available to customers have to be simple. We have a platform called Solocal Manager. It's in the hands of pretty much all of our customers. And using this platform is one of the priorities that we are developing so we can maintain customer confidence over the long term. And as we said before, for a business that provides services such as business -- such as Solocal, ROI is key. And maintaining ROI is key. Our businesses -- our business customers need to better understand. They need to better feel every single day the value added that we provide. This may need -- this may require more dashboarding in terms of our relational marketing efforts. We have human beings supporting them throughout their customer life cycle. This may mean converting all the leads we get them. This may mean a better ability to generate in-store traffic. Our ability to ensure better call traceability, quote traceability, the quotes that we generate. It's important that they perceive the value add that we provide when they subscribe to one of our offers. So these are key aspects in terms of building their trust and our strategies over the next 3 years. Secondly, we also believe we can take things up a notch and better leverage our assets. When it comes to data, as I said before, data and customer insight is a unique asset. We have the best B2B and B2C customer bases in France. We are able to leverage that data. Our market share is 4% for this very specific data activation market. Data activation is low relative to the assets we have on hand. So we need to grow that business further. Secondly, housing B2B are strategically important sectors, priority sectors. And one of our value propositions that we decided to invest in over the next few months and years is to help businesses better transform the leads we give them. So lead life cycle management, quote management is one of the things that we're going to invest in. We will integrate that into a platform so we can better help our customers transform their leads into actual business using our digital solutions. Now we can't talk about trust unless we talk about our flagship product, a search engine. The Yellow Pages search engine. PagesJaunes, as it's called in France, is a search engine -- sorry for the slide show noises. PagesJaunes or Yellow Pages has high viewership. 15% of the French population uses them -- uses it every single month, whether directly or indirectly. When you do a Google search, for example, as we did before, I didn't go through the PJ website directly. There are other entry points such as Google or other search engines, and you find yourself on the Yellow Pages. So via our viewership numbers, we find that in recent years, viewership has been down. Viewership has gone down on our Yellow Pages because of our approach. We have an approach that is based on partnership agreements. We have partners that are interested in our rich content. And so our partnership agreements are growing steadily. And as a result, direct traffic on our Yellow Pages website keeps going down. So down 7% over the past 3 years. And this mostly affects the 25- to 50-year-old demographic. The younger generation and the older generation have maintained their level of usage. But the category in between are probably captured by other users, other players that better meet their needs for specific searches. Maybe the depth of information they provide is better, and so they have increased their market share to our detriment. But PagesJaunes, or PJ, continues to rely on significant assets, for example, brand awareness. And everybody knows Yellow Pages. 94%, that's our notoriety. That's our brand awareness, which is huge. Everybody knows about us, pretty much the entire working population of France. But people don't necessarily have that reflex of using the Yellow Pages anymore. Everybody knows about it, but not everybody thinks of using it. So brand awareness is high, but knowledge of our value proposition isn't as high. Our second strong asset, however, is our image, our reputation. So when we talk to users and nonusers, irrespective of the demographic, irrespective of their age, trust, reliability is the first attribute that comes up. So we have active users that use it every single month and then there are occasional users. So trust is key. It's an asset for any brand. You can't dictate it overnight. It takes a long time to grow that trust. It's a capital that you grow over time. It's something that you want to preserve at all cost. It's a legacy asset that we rely on. And secondly, exhaustive information is something we want to provide. This is probably something that we're not being very good at, but the richness of our database gives us incredible power, so we can better editorialize and better operate this brand, the search engine and that capital that we have. We are the perfect intermediate between users, consumers and local businesses. Now we have a trajectory. We went from a print directory to Yellow Pages online website. But obviously, there are intermediary steps that are requirements for success. We want to be a trusted third party, a force to be reckoned with. You can't be on the marketplace unless you create that sense of confidence. And look at major B2C players, all the known platforms generate their trust. They work on it. They cultivate it. So maybe legacy print directories didn't need to do that in the past, but not anymore. You need to revamp your image so that you can improve user experience. And this is a priority in terms of our strategy over the next few months and years. So 3 different pillars here. Firstly, we will go even further in terms of rich content, in terms of beefing up the content we provide and making that content available to consumers who do Yellow Pages searches. So we make the content available. We editorialize it. We may even go as far as certifying it to make sure that the Yellow Pages is a brand that provides certification, a brand that provides information you can trust, assuming you're a local consumer. Secondly, the user experience must be adaptive. We need to better interpret the search. There are simple questions. For example, finding a restaurant in Paris, but maybe the search can be a little more complex. For example, if you're looking fine dining, you don't want to list all the local McDonald's restaurants, right? So this is based on our insight into user searches. We know what people actually look for when they check out the Yellow Pages. We need to interpret the search as best we can, so as to provide the best possible answer, and that's technology that we started to developing several months ago. And as part of this -- and as part of that effort, we are improving our visibility. Also, we want to empower search engines. Well, depending on the area of business. Maybe the search will be geography-based or you're looking for a specific service, a specific product, a specific price point. So depending on the area of business, depending on the vertical market, the point of entry will be different. And lastly, transparency. You saw the Google example earlier. There's a difference between SEO and SEA, search engine optimization versus advertising. So transparency is key. We need to be transparent in terms of the differences between SEO and SEA. Third pillar, we want to leverage our search engine. The algorithms that we have developed, which we own, that's something we need to leverage. So we can make the most of the response we provide. I'd like to remind you that up until recently, all Yellow Pages searches were random responses for a given search. The answer was very neutral because it was completely random. But since then, we have developed a response that is based on relevance. So the businesses that have the most hits actually match the needs of the highest number of consumers. And so lean management is key so we can monetize that list of hits, so we can provide priority ranking to customers are willing to pay for it. So that's something we're going to fast track. And together with PagesJaunes, Yellow Pages, we're building more trust, and we're positioning ourselves as a preferred and trusted third party, whether we're talking direct traffic to our website or traffic via our partner sites. A quick example to make things more understandable. All of the data goes through machine learning algorithms that we develop ourselves, and we aggregate a lot of data. And this provides us with unique insights into professionals, into businesses, their data, their content, their inventory, how much they charge for their services. These are discriminating factors. Popularity as well. Based on reviews, opinions or posts from consumers or even their natural appeal, their natural attraction, whether on our search engine or other search engines. What about official certifications? There are so many on the market irrespective of the area of business. But that's information we already have in our database. This means we are better able to qualify those businesses, those professionals. And for most of these businesses, we have partnership agreements. And this helps us strengthen our insights into their business. So all of that big data available to us on this market as an intermediary between users and businesses, all of this data will help us turn PagesJaunes into a certification body and the intermediary of choice between users and businesses. That's it for me. Before we move on to part 2, how about a quick questions and answers session? Are there any questions at this stage, whether here in-person, the people here get priority or maybe we have questions from online participants?

Hello. I'm from [ Finance Connect ]. Product quality is amazing. I think you've come to the same conclusion. I don't understand the shift in revenue. This is a buoyant market. We feel that decisions have been made. The thing is you may have the best product, the best strategy, the best company. But if sales don't keep up, then what's the point? So my question is, the leads that you sell, how do you define them? How are they defined? You were using a remarkable town by way of example. I think it was [ pretty ] wasn't it? But why not talk to several people in that same town? Why not have a city-based approach? And maybe a comment regarding Doctolib and other such vertical markets. A long time ago, Solocal used to have a vertical type of presentation methods, vertical services, vertical businesses, et cetera. So -- and one last question, what about GDPR? What about changing algorithms? I get a feeling that Apple, Facebook, Google -- what does this mean to you? Is this a pro or a con?

So I'm going to answer a part of the questions. The first point is what type of lead, how do we define our leads that we sell to our professionals. This is a very important point because bringing leads to a professional, a lot of people can do that for different costs, different prices, but a lot of people can do that. What -- pros value is not the lead in and of itself. It's the quality of the leads. So is this lead exactly what I'm expecting to develop my activity? With the quality of the lead, and in all of our products, we've illustrated that with the video on the website. In all of our products, the first step, calibration of our products and the delivery for our customers is a key step. There's the sales phase. And there, there's the calibration phase. We are learning to know more about this professional during the sale, during his onboarding and throughout his relationship with us. The questions we ask are not questions about whether we want to do advertising on Google or PagesJaunes. Our questions are what -- who are you? What do you do? How do you want to develop? For instance, if you're covering -- if you're doing roofs, do you do inside roofs? Do you do the outside? What are your specialties? Do you work around Poitiers? Or do you have a broader intervention zone? What are your business goals? And the first exchanges we have with professionals are not based on a self-service formula. It's based on understanding the professionals, what they do, how they do it. And it's based on this information that we calibrate the delivery of all of our products based on this information, on the calibration we do. This changes everything about the quality of the leads that we bring, which are extremely qualified. So how do they materialize? Depending on the activity, there's different types of leads. Phone calls, sometimes, we're going to make sure the phone rings to our customers. And every time the phone rings at the customer, there's a small notice that tells him this phone call comes from Solocal, so that he's aware that this lead comes from us. We also bring in customers directly, which he can find throughout his platforms. We also provide him with meetings, with traffic in-store, which is something that's harder to quantify today, even though we have technology to do it, but we still have to invest to materialize that. A lot of our relationships created are translated into a physical presence of our customer in his store for our clients. This is also going to be within the frame of the leads that we bring to our clients. And this is what our clients value. So this is the first part of the answer we can give to the question you asked. You also had a question about when we see we have business in Poitiers or Tulle, anywhere in France, why don't we geographically accelerate on that business? I believe it was mentioned by Eric earlier, who may add to what I just said if he feels the need to. The first is our -- there are 2 segments for that. First is the contact plan to mobilize our sales staff, help them optimizing their sales activity and their productivity, but also to help them geographically speaking. And as Eric said, the tool that we use is a cartography tool, anchored locally because you've just made a sale in Poitiers. You take your car to go to a neighboring town, you're going to spend maybe when you go on your -- just back to your car in the parking, you're going to find a prospect that's interesting because he's very similar to the prospect you just transformed. This is an approach that's very based on data. It creates typical profiles. We score our prospect base. There's -- what's specific about us is that we have our own base of prospects. We know the entire market, so we can profile these prospects. And so we can send sales staff to Poitiers for instance, not just opportunistically to meet sale, but also to look at all the opportunities that correspond to the sale. A second advantage is the recommendation that Eric was talking about. I just had a commercial interaction with a professional. I just transformed the professional, probably knows of our professionals in his sector or maybe in his street or maybe in his network. And we have a very strong strategic aspect based on recommendations for clients that are both recent and new. So this is a very strongly geographic approach. The third question you highlighted was concerning RGPD (sic) [ GDPR ], the European Data Protection Act. So it's a vertical approach. We were looking at the competition market, and there are vertical actors in that market. I don't want to talk about them because I don't want to advertise for them. Some of them have even become very important because of the health care crisis. So these players, these vertical players, have taken markets such as health care, for instance. However, you may have seen in your presentation, we also have this vertical approach. Herve has talked about it. We are a lot stronger on this vertical part than on others, for many reasons, for go-to-market, for value propositions, for coherence of what we're proposing compared to what others are doing. And so we're going to accelerate vertically. I also mentioned, when it comes to PagesJaunes, when it comes to the user experience, we are going to verticalize this approach. If you're looking for a florist, you'll be more satisfied as a user. But if you're looking for a craftsman, you'll want to see what the opinions are, what are his price, what are his services, and is he the right one for you in terms of the skill you need? So our vertical approach to the client experience on a product like PagesJaunes is also something we're interested in this vertical approach. We've followed it, thanks to the analysis of the market competition. We work on it, thanks to our go-to-market as well. And this logic of profiling of prospects is also going to allow us to work on verticals, which are more revealing, and allow us to work more on our products so that there's better correspondence vertically between the user experience on PagesJaunes. It's going to allow us to go faster when it comes to client intake. And I'm going to finish on GDRP (sic) [ GDPR ] because it's a major point because there was a new DPO a month ago in the company. All our data today is GDRP (sic) [ GDPR ] compliant, and this is something we're extremely precise with for 2 reasons. First of all, because since we're a data player, as we're users of this data, we have to have a very strong link with the regulatory framework so that we respect it, so we don't take any risks. And this is an approach we've had since a lot longer than 2021. And our General Secretary, who's in the room, knows that this has evolved in our company at the same time as the French regulation. It's something that we've been working on for several years. Another point is that it's also a central point for trust. You can't collect data on our clients if they are not RGPD (sic) [ GDPR ] compliant and then promote trust with the market. So GDRP (sic) [ GDPR ], of course, is something that's a priority for us. Is it a risk or a hindrance in terms of business today? No, I don't believe that's the case because by respecting these rules, these legal rules, by working hand in hand with the organizations that write this legal framework, we managed to use this data for analyticals or operational aspects of the business. So this is something we've been working on very closely today when we're working with our customers to remind them of our GDPR compliance, especially for larger companies that are much more familiar with these issues and much more careful when it comes to any problems they might create.

Any more questions? So we talked about a disconnect during the questions between the fabulous presentation of the products and the weakness of the growth of our turnover. On this point, I would have difficulty answering the question for the past, but I believe that the starting point is to remind you that Solocal has had 2 huge transformations over very small periods of time. One is that technological transformation because if Maxime has so much to talk about in terms of offers, it's because of these new solutions that were developed in 2018, '19 and '20. And this is a great transformation because a sales force as vast as that of Eric cannot appropriate such a change as quickly as that. But we've also changed the business plan, which creates a new transformation. We've gone from a renewal model to a subscription model. One plus the other means that you -- your sales force is going to be lost at some point, and that's exactly what happened. So I believe that in your question and in your analysis, you understood that all the work I want to do is to make our product offer, our service offer coherent with our sales force, ensure that these are no longer separate bricks, but a puzzle, which is coherent, which is understood by the market and by our customers. This is the entirety of our work. We don't have anything else to do because everything else is in our favor. Our work in the [indiscernible] is to make this coherent and relevant.

Thank you. Herve, we have a few questions on the webcast. We're talking about these changes in the business model. Why does it work better in the Southwest, as you've said in the slide?

I'm going to let Eric answer the question, but my immediate opinion is the management. The team is led by an efficient regional director who has understood very well the stakes for Solocal. He makes no compromises. He's very positive and also very incentivizing with his team when they work well, but he also looks at incidents and problems head-on. So his managerial posture is very professional. And now with Eric, we want to deploy that throughout our regions, throughout management. With the human resources, which up to now, we're not a business partner. And I want to make -- I want to force human resources, motivate human resources to work hand-in-hand with our sales force. And yes, in [ Bordeaux ], it's working because it's already been done. We have a question about the amount of employees in Solocal, if we don't have too many employees compared to the standard of the market. There's 2,400 employees in -- spread out in 3 large families, the sales force, whether they're local or field; the builders, those in -- who in the field, we saw them in the film earlier, those who are going to build websites, advertising campaigns; and then there are the support functions. Are there too many of us? I cannot answer this question without highlighting one important point, which is the competitiveness of the company. Throughout these next 3 years, I will look at the competitiveness of the company and how quickly it can take decisions. The cost of sales and execution speed will be the 2 management pathways for me. If it's the case that there are too many of us, we will take the appropriate decisions. I don't -- I'm not sure that's the case as of today. I have other questions on the webcast. But if you have any questions in the room, don't hesitate. Can you go a little more into the detail in the numbers for the 3 categories you have? So the sales force, we have 1,000 people. I think that's the case, right, Eric? Yes, about 1,000 with the customer relationships, so a little more than 1,000. For the crafters, a little more -- a little over 400 people between Angoulême and headquarters, and 800 people in the headquarters for support functions. There's a product marketing, campaign managers, people who are at the border between production and support. We also have a question concerning the media plan you mentioned in the presentation. Are you going to start advertising again? Yes. Yes, as Maxime said, briefly. You've understood very well that we want to breathe new life into PagesJaunes. We cannot have a long-term ambition of building around PagesJaunes a marketplace without creating some -- creating strong milestones, and we want this search engine to become a trusted search engine for that. This means we are going to advertise. We are launching a new PagesJaunes mobile app, which is in a beta test phase currently. And for 2022, we are planning to work on PagesJaunes through advertising campaigns. The last advertising campaigns for PagesJaunes was 6 or 7 years ago. There was another one. There was one in Solocal. Yes, I'm talking about PagesJaunes specifically. That's what's interesting. You say I want to say Solocal. In advertising, it's pointless. Was it useful, by the way? Maybe we can say it with the time that's been spent. What you're proposing now is PagesJaunes, yes, we're only going to advertise on PagesJaunes and remind the French market that we are going to be middlemen for consumers and professionals in a reassurance context and appreciation context. What we want is, over time, for the search market to become not a stupid search engine -- stupid is not the right word, a basic search engine to a recommendation search engine. Why do we want to do that? Because in the long term, the fight is not going to be over relationships. It's going to be over transactions. And if we want to be part of that battle, we have to put all the ingredients in the mix. And the first ingredient is not the marketplace. It's the trust. All the platforms you know insist on trust, first and foremost, and the ability to create relationships between consumers and professionals in the best possible conditions. This is our approach for PagesJaunes.

[indiscernible] France. I just wanted to come back on the fact that you wanted to make PagesJaunes a marketplace. What are you missing today in terms of skill? And a marketplace means that you select people who are there, which is a bit different from what you're doing today. Will you simply sell access? And finally, a marketplace is somewhere where you pay where there's a transaction. So what are the skills you're missing? Are there acquisitions you need to do? Is there anything? It's a large transformation.

You're right, and we're missing a lot of things, which is why I insist on the fact that the marketplace is a long-term vision. And for what concerns you specifically today, we're going to be talking about the short-term ingredients, which are necessary to create a relationship between professionals and consumers. So the marketplace as of today does not exist, but you are correct in thinking that it's going to be more and more important within our organization, and it's going to become a need for our users and our consumers. And today, we are not ready. We are not ready for that. To create a link between a professional and as consumer is, as Maxime said, certifying that professional, selecting him, recommending him is ensuring that the relationship that's set up, thanks to PagesJaunes, is the best one for both parties. That's our critical path. So we're not at the marketplace yet. However, what I'm interested in is making it a target for us. Will we accomplish our goal one day? I don't know. But what is certain is this will force us along the path to set up everything we need to create a transaction program. Today, Solocal is positioned as a relationship actor. We prepare leads. We create relationships with our storefronts, the digital storefronts. So we talk about relationships. I believe that in the medium run, Solocal will have to become a transactional actor. In order to do that, and that's why I insist on this, I believe that we need -- we don't really need a few new features in the platform. We need to control the financial and administrative flows of professionals because at that point, you become legitimate. You can talk with your professional about his last customer intake, his next bill, and then maybe afterwards, of his accounting because you will have built with him a platform, a management platform for third-party accounts. We have a few financial questions. So if you want to move on to the financial part. So now we're going to move to Olivier, who is going to come work with me, and he is going to give you a translation into numbers of our strategic plan.

So it's -- thank you for listening to me once more. So we're going to go a little more into the details of the figures. But first, I really wanted to insist on one point today, what is our new model? And I remind you of this every way, but the transition to this model from a renewal model to a subscription model completely changes our performance, how to look at it and how we build our turnover, which is why I really want to insist on the fact that tomorrow -- and I really want to insist on how our turnover will be composed tomorrow. So we have 2 blocks, 2 completely separate entities. The first block is here, the blue block, which is our orders today on the 30th of September, what is my customer backlog? And these are customers whose turnover is -- this is turnover that has not been recognized. It's mechanically going to be recognized, not necessarily just on the year to come, but on all the years to come. And this is the blue part, the dark blue part. These orders are going to generate turnover. And at the end of the contract, they're going to renew themselves. Let's imagine that the churn is 15%. So 85% of these customers are going to renew themselves, and there are going to be new sales. And this is the barred area you see on top. So this is -- if Solocal stops all activity on the 30th of September, this is what we get. Then there's another company, which is Eric's company, the company of the salespeople, the company of acquisition. And this acquisition company, it makes orders. You know that our orders convert to turnover over a period of 12 to 24 months. And on the first year, they do a little bit of turnover. The second year, they do a little bit more. And then you have a renewal part, which is here on top. So Solocal is the combination of these 2 visions. On one hand, a company with a backlog, a company that fills up by doing -- by making acquisitions, and then there's a multiplicator effect. So this is very important compared to the previous model. Herve was talking about acquisition costs. Today, acquisitions, you have to compare them to the lifetime value of the acquisition. We haven't managed to completely turn the page, so -- but we'll manage one day, and this will be our model. So this is very important to understand our model, our approach. So as you've understood, there are 2 key elements in this business model. On one hand, there is the churn, because the churn, in reality, is our backlog. What induces turnover in our backlog is the churn. And the churn, we've seen that the key elements -- we already know what the key elements are to put in place to reduce that churn, so customer care, customer satisfaction, what Eric was talking about, satisfaction. And this is the telesales teams that are going to do prevention and retention on the basis of the scoring system, which Eric talked about. We're going to insist on that a lot because once we've acquired the customer, the churn is the only driver. So the important part of satisfying our customers. The other element we're going to work on is acquisition, increasing the amount of hunters, making sure our plan is well adapted because we have a completely different business model, ensuring that we have contact points, more precise contact points with a better organization. We have a better mapping of our opportunities, and this is what the media plan is going to allow us to do, remind professionals of what we're creating for them with the value of bringing in. These are the 2 elements. Churn and acquisition together are going to combine and create our new model, which is going to allow us to build that turnover. So I just wanted to spend 2 more minutes on this table here on the left. You remember what I was saying earlier about how our turnover is divided. So the blue part is the backlog. The renewal of the orders in the backlog. And the purple area shows the acquisitions. So we created a model for that. If we hold on to the same level of acquisitions, as 2021, our revenue will be more or less flat. So assuming we have the same level of acquisitions in 2022, revenue for 2022, '23 and '24 will remain unchanged, pretty much flat. Now considering all of the initiatives that we are busy implementing, this level of acquisition is bound to grow. So any marginal gain in terms of acquisitions relative today is going to be leveraged because of the lifetime value, because of that impact, because the contracts are being renewed. Again, apologies for the sledgehammer noises. So any extra acquisition will be leveraged and will have a potentiated impact over 2022, '23 and '24. So because of this combination of factors, we are confident that starting in 2023 and '24, not necessarily in '22, but revenue is bound to grow by 5% a year. So this growth will come from ARPA, average revenue per account. Why? Well, because, as Eric rightly said, most of our focus will go to our field sales force, which has a higher ARPA than telesales. So our churn mix, basically, ARPA for churn is lower than ARPA for acquisitions. And as a result, the average ARPA of our portfolio will increase. So we expect our customer portfolio to be stable in 2022 and to start growing again in 2023 and '24. Now the major assumptions behind our business plan are here on the screen. A gradual ramp-up of tacit renewal, the subscription mode is going to ramp up. We're maintaining the churn level. We have a special focus on our field sales force, which drives ARPA. Fixed costs are under control. We will continue to keep a lid on fixed costs. And I think you all trust me to maintain our fixed cost base, keep it under control and gradually reduce it. Lastly, our media plan will whet people's appetite for PJ. Now because of all these factors, we expect we'll be able to grow our revenue by 5% per annum in '23 and '24. We will maintain our margins and our fixed cost base to the tune of 15%. And ultimately, we should be able to generate cash. You're familiar with our cash model, for those of you who've been with us for many years. So this is what happened in 2020. From a cash perspective, 2020 wasn't the best year cash-wise because of COVID-19. There's an important aspect here. As you know, I pay close attention to working capital requirement changes. An advanced indicator of our sales performance is WCR and changes in WCR because back in the day, people paid us well in advance. They were used to paying their subscription to the Yellow Pages 6 months ahead of time. Now when we have new customer, we don't need 6 months to print out the directory. As a result, the WCR change is negative. If it's flat, we're slightly negative. If we're growing slightly, it stabilizes. So on the basis of the EBITDA growth and the revenue growth of about 5% per annum, we expect WCR to stay rather stable in '23 and '24. So we expect the level of investment to maintain itself at EUR 35 million; leases, EUR 20 million; and our operating cash flow before tax of about EUR 90 million. In summary, before I let Herve wrap up, well, this isn't a guidance. It's an outlook. We expect 2022 to be in line with '21. In 2021, we anticipate revenue between minus 2% and 0% growth. We expect operating free cash flow to exceed EUR 40 million. We expect EBITDA to stand at EUR 120 million. But in 2023 and 2024, things will be much fast tracked, and revenue will increase by 5% per annum. EBITDA will grow by 15% or so per annum, and operating free cash flow will exceed EUR 90 million in 2024. And now Herve will wrap up. If you have additional questions, we are on hand. Thank you.

I'll tell you what. Thank you so much for your attention. Thank you for participating. Thank you for being here, whether in person or remotely. What are the key takeaways? What is it that I want you to go home and remember? There are 3 main aspects that I want you to remember. First of all, our customer focus. That's something we've tried to share with you, our customer focus. This is a change that I wish to operate within Solocal. I want the customer to become the focus of everything we do in terms of our decision-making, in terms of our strategy. Without this customer focus, we cannot get back on track to growth. This means we need to make investments, financial investments, human investments in terms of processing, in terms of providing assistance to our customers, be they actual customers or prospective customers. Also, and this is something that's been said many times, but we came here today to get the message across to you that we are going to do our absolute utmost to restore growth. The past quarter means lending, a positive lending, plus 4%. So things are stable. But I'm hoping that in the next few years, we can grow safely but surely. I'm hoping that in the next few years, we will start growing again. As Olivier rightly said, we are not here to sell dreams. I want to be extremely conservative and reasonable in terms of our ambitions. And this is why I do not expect our performance in 2022 to be much better than '21. Well, we might grow slightly. That's the extent of it. However, I do want our growth in 2022 to be both stable and profitable. And we will do whatever it takes to make sure that the growth drivers are as in line as possible in terms of economic performance. And if we do succeed, if we do meet this first criterion, then we will look to the future. And then we will expand. And the figures you saw today do not reflect the third level of our rocket ship, 360-degree services that we wish to provide in 2023 and 2024. I did not include this as an acceleration driver because we're being conservative, because we're being extremely cautious. I want to walk the talk. If I make a promise, I want to be able to deliver, so I'm not going to overpromise. Thank you so much for participating, and we are on hand for the second and final Q&A.

[indiscernible] Why aren't you expecting a much higher increase in the customer base? 18 months ago, we did expect the customer base to increase more than ARPA. So what do we change tech?

Well, we need to pick our battles. And Herve and Eric rightly said, our battle is being waged by our sales force in the field. It's about increasing ARPA. That's the reactor core. It's not as though we decided ARPA is not important, but we need to pick our battles. And we decided to focus our efforts on making the necessary adjustments to the sales force in the field. And acquisition-related ARPA is higher. So I believe this means we have more value-added to provide to those people. I'm not talking about very, very small companies, but I'm talking SMEs with teams of 5 to 10 people. Anything you'd like to add?

Up until now, we've had a policy. We've had a policy of increasing our customer base at all cost, and it's not a bad policy, assuming you are in a position to track and follow up small ARPA. But we've come to the conclusion that we can't spread ourselves too thin. We need to make choices. We need to prioritize, and we decided to make short-term investments into our field sales force. This does not mean that we have abandoned our customer base acceleration policy forever. No. But to -- if you want to embrace a smaller ARPA, you need to follow up on it at a later stage, so you need to embrace it. You need to make plans for it. And so only then will we further develop our customer base because not only will we hold on to our customers, but we will monetize them better. As we said before, our business plan is extremely pragmatic. It's fact-based. We built our business plan based on what we are capable of delivering, what we are sure we can deliver.

EUR 35 million in CapEx a year. What are the necessary investments? Which investments are going to be ramped up? Which ones are going to go down? And how does this relate to turning Solocal into a marketplace?

At this time, we'll be assessing all of our investment lines, and there will be trade-offs that need to be made based on the strategy that we just introduced to you. So yes, we'll have to -- we will have to prioritize, and there will be projects that will need to be discontinued. But there's nothing new here. We've initiated projects over the past 6 months, but we've also discontinued projects as well. That's item number one. Item number two, what's your second question? Oh, the marketplace. Okay. Well, as I said before, nothing will be directly connected to the marketplace. I believe that would be unreasonable. It would be unreasonable to imagine that you can actually build a marketplace over the next 3 years. I would never commit to that. That's not a promise I can make. However, we need to prepare Solocal so that one day, it can turn into a marketplace. That I can do. That I can deliver. Now in terms of the major types of investments, there are investments in 2 products. And that's the reactor core, right? That's our core business. We're investing into the product. We're investing into Yellow Pages, PJ. We just came up with a new Yellow Pages app. So now is the time to do a little plugging. We're also investing into our commercial tools, our sales tools. And assistance to sales is very important. And also on the data side, customer insight is key. And the last pillar of our investment strategy was down to helping the group move into subscription mode. So yes, we do provide subscriptions, but our systems aren't entirely subscription-friendly yet. So part of our investments will focus on that over the next 3 years.

So you're going to generate free cash flow, and you're going to use it to deleverage or for M&A purposes?