Local Phone Numbers vs. 1-800 Numbers

by Shagun Vatsa on June 7, 2009

Which To Choose for Higher Call Volumes

There is a significant difference between call volumes when using local phone numbers in various types of advertising, compared to using 1-800/toll free numbers instead. When talking about national brands, most companies choose to have an all encompassing ‘vanity’ number such as 1-800-MORTGAGES for example. While this method has a positive impact in terms of brand recall and retention, call volumes suffer a great deal when compared to businesses who opt to employ local phone numbers.

Dr. Dennis Fromholzer of CRM Associates, ran a metered ad study in 2009, taking into account call volume differences between local and 800 numbers in print and IYP advertising. In an email to subscribers, Dr. Fromholzer says “The conclusion is the same as observed in other countries:  consumers are far more likely to respond to an ad with local numbers rather than an ad with just an 800 number.

Key Observations

A study carried out in 2009 comparing 1100 toll free numbers across a range of YellowPages service headings, Dr. Fromholzer observes the following:

•    Ads which include a local phone number receive more than twice as many calls as ads with just an 800 or toll-free number.
•    The cost per call is 2.4 times higher in ads with just an 800 number than with ads with just a local number.

Such results are not only observed for studies carried out in the US but across several other countries around the world indicating the consistent worldwide consumer buying behaviour. In general, consumers like to be served personally and not with an automated voice system which re-directs them to one of the many thousand call centre agents one comes across once they dial an 800 number.

Things play out differently when it comes to IYP (Internet Yellow Pages) ads. It appears that 800 numbers in IYP ads do better than for print ads:

•    75% as many calls as local numbers rather than 30-50%.

However, this would be an incorrect conclusion having observed the following:

•     The cost per call for 800 number IYP ads is about 3 times higher than for local number ads ($52/call vs $16 per call).

800 numbers were used more frequently in ads with broader geographic coverage (state, regional, national), or ads with larger “package” deals. Looking at results like these, usage of 800 numbers proves to be highly unprofitable for the advertiser.

Some still believe that the usage of 800 numbers will not be a negative in the online world. This belief is flawed on the basis that people are people, regardless of technology. The reason why ads with 800 numbers fail to receive high call volumes is both print and online media is because of the general negative reaction of customers to an 800 number. Such a number suggests the following: “not a local business”, “call centre”, “long waiting queues”, “less personal service”, “automated voice systems”. All these factors boil down to the same conclusion that people like to deal with someone who cares about their needs and provides service with personal attention. [Excerpted from CRM Associates, Local vs 800 Numbers, 2009)]

It should be noted that while an 800 number alone can cause harm to an ad, using an 800 number IN ADDITION TO local numbers adds value. This combination gives the consumer more control and more choice. A set of 18 split-run tests with national display ads showed that the “local line + 800 #” received an average of 84% more calls than the 800 number alone.

While consumers on the internet behave differently than those that use the Yellow Pages, they still have a fair number of things in common, and the desire to deal with a local service or vendor is one of them. With the exception of e-commerce, most consumers on the net are still largely dependent upon calling in to complete transactions.

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