How Important is a Local Phone Number for SMB Call Advertising Programs, Part 1

institute_070612_mainFor small businesses using call tracking, and the call advertising companies that support these programs, a key consideration is whether or not that phone number should have a local area code and prefix.  After all, local phone numbers provide a familiar reference point to consumers and indicate that a consumer would be connecting to someone around them.

On the other hand, there are reasons to think that this reference point is becoming less important.  New area codes are seemingly created all the time, and local phone numbers are often scarce.  Local numbers have moved with consumers’ mobile phones across the country.  In the context of advertising, toll-free numbers are common and were originally used as benefit to consumers, removing the cost of a phone call.

On mobile devices a phone number is often replaced by an icon of a telephone, meaning that a local or toll-free area code is only displayed if there is a pop-up prompt asking the user “Are you sure you want to call XXX-XXX-XXXX”.  Google’s mobile click-to-call product excusively uses toll-free numbers.

Over the next few weeks, we’ll be exploring the importance of using local phone numbers in digital advertising campaigns and seeking to answer a number of questions, such as:

– Does using a local number produce more phone calls?
– Is using a local number important when advertising on mobile devices?
– Is a local number more important for certain types of businesses?
– Is a local number more important for certain types of advertising channels?
– Are phone calls placed to local numbers better (more likely to convert)?

In Part 1, we’ll be exploring this last question.  In other words (ignoring the VOLUME of calls generated by using toll-free or local number), are the calls themselves more likely to produce a sale?

In Q4, 2011 the Marchex Institute analyzed several thousand phone calls and placed each call into one of more than a dozen different outcomes, such as “appointment”, “wrong number” or “follow-up”.  Roughly 10% of these calls were made to businesses with call tracking numbers that were toll-free, the rest were local.

Although we classified each call into more than a dozen outcomes, for the sake of this comparison we placed calls into two buckets:

– Relevant, or any conversation between caller and business about new service or product
– Not Relevant, all other calls

In comparing “toll-free” calls to “local” calls, the percentage of relevant calls was identical.

Why might this be?  A simple answer could be that a local business listing or advertisement with a call tracking number often includes an address so the caller has an idea about whether the business is near them regardless of the phone number.  Another could be that once a consumer has decided to make a phone call, the phone number itself is no longer a factor in whether or not they will choose to buy.

Although this particular study seems to indicate that a local or long-distance number doesn’t influence the quality of a phone calls, there are several additional things to explore

1) This study should be repeated using a larger number of toll-free phone calls and a study designed specifically to match these up apples-to-apples.

2) Although this study indicates that an equal number of calls are “relevant”, it does not study the difference in “appointment rate” or “sales rate”.

Over the next few weeks, we’ll be updating the Marchex Institute site with additional information tackling these questions, and also slicing this data by category of business and advertising channel.  We’ll also look at call volume, or the number of calls produced by using a local number.

Please use the comments section for questions, or e-mail us at marchex-institute at marchex dot com.  If you’d like to be updated when new material is available, subscribe to our RSS feed.

John Busby leads the Marchex Institute, a research and analytics team that publishes findings on mobile advertising and the growing digital call advertising industry. The Marchex Institute also provides custom research and consulting services for customers on their mobile and call-ready advertising campaigns. Previously, Mr. Busby served as Vice President, Product Engineering at Marchex. You can find him on Google+ and Twitter.

Posted in Data, Marchex Institute, Performance Advertising

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