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What he said.
Depending on what shape your account is in currently will normally dictate how much work it will take up front to whip into shape. When that is done, it will be a constant process of tweaking and optimising to pick up small wins along the way.
It's absolutely fair for a company...
Look at keywords your competitors are targeting on their main pages - that should at least give you some ideas to what you should possibly be targeting if you don't know where to start.
While content is important (product pages, blog, etc), you also need to work on building links to your pages...
Based upon your number of subscribers and volume of emails you send, MailChimp will probably be your best option (at least free option).
I've used a few different providers and Campaign Monitor is probably the best I've used to date for one-off email campaigns, automation / nurture campaigns...
It's not difficult to find an SEO expert. Find some of the top digital events locally / nationally / internationally and see who is speaking, do some research on them and their successes in the past, speak to them and see if they are right for you.
You typically get what you pay for with SEO -...
The difficulty with some medium / large digital agencies is they utilise Sales teams to sell their services who have no idea of the nitty gritty of SEO and are basically following a Sales script. Start asking difficult questions and the conversation can go south.
Going directly to an SEO expert...
If you haven't signed up, then it shouldn't be too late to back out. I've never had direct dealings with Yell so can't comment on that front - would do no harm to investigate further and perhaps speak with a specialist PPC firm for at least a second opinion.
I would agree strongly with Erno...