Don't Pay a Thing If You Don't Get a Ring

Pandia Guest Writer Paul Bruemmer writes about Verizon's new SuperPages Pay For Calls system.

© Paul J. Bruemmer, trademarkSEO

(August 8 2005) The Verizon SuperPages Pay For Calls headline reads: “If Advertisers Don't Get a Ring, They Don't Pay a Thing.” Sounds a bit like, “You pay only for the clicks to your website,” right?

Verizon announced its new Pay For Calls system at Search Engine Strategies 2005 Conference & Expo in San Jose, California, which runs August 8 through August 11. They say the product offering is so innovative that it requires patent protection. “Our pay-for-performance technology and unique ad placement algorithm are so advanced that we've applied for a patent,” said SuperPages.com President Scott Laver.

On the Heels of PPC

Pay-per-call is the performance-driven search marketing strategy that mimics the pay-per-click (PPC) phenomenon of paid search. As such, it hopes to capture some of the PPC market share.

Kelsey Group's Greg Sterling suggests this is possible for a number of reasons, such as the proliferation of broadband and the increase in local searches. Additionally, click fraud is a big problem in PPC advertising. There have been lawsuits over click fraud, creating some doubt as to the integrity of the clicks. Then there's the fact that many small businesses prefer telephone to online leads because they're better able to engage the prospect and close the sale. Customers also like to pick up the phone when they need local products and services. Sterling believes these factors can drive PPCall adoption.

PPCall's Track Record

Last month, I wrote about the development of a PPCall search marketing strategy by Miva and telephone-technology firm Ingenio. These PPCall search listings are displayed on Miva's distribution partner sites as well as Internet service provider AOL and mobile phone content provider Go2.

Ingenio/Miva sell PPCall listings by auction-type bidding with a minimum bid price of $2 per phone call. Bids are based on business categories rather than keywords (as in PPC). Ingenio reports that calls averaged $6 to $7 two months after launch, and in some cases went as high as $30.

The Power of Online-Offline Integration

We all know that the telephone is a powerful business tool and that marketers are always looking for ways to integrate online and offline technologies. What better way than to drive phone calls with search marketing?

Search is the killer app with revenues increasing at a faster rate than any other marketing strategy. Since paid search (PPC advertising) gets the larger share of search marketing dollars, it's time to clone the business model.

PPCall generates phone calls rather than clicks. These phone-call leads are from prospects in a later stage of the buying cycle than the click leads, making them easier to convert. While there are some similarities and differences, PPCall is a logical extension of PPC.

Untapped Target Market

Small businesses, and especially local businesses, are the target market for PPCall. The local market consists of service-based businesses such as attorneys, real estate agents, mortgage brokers, restaurants, beauty shops, tax accountants, plumbers and other professionals and independent entrepreneurs. Many of these businesses don't have websites.

There are about 14 million small to medium sized companies in the U.S. without websites. These business owners are under pressure to go online as the Web becomes indispensable for consumer shopping.

Yahoo! saw the opportunity early on and started improving its local search database and providing free websites to U.S. small businesses. Verizon also provides a web presence at no cost to any business listing in the U.S. This is a win-win because integrating these listings into the engine's local search database gives its users a better search experience. At the same time, it gives the merchants more marketing power with PPCall and PPC.

How Does Verizon PPCall Work?

A dedicated toll-free or local telephone number will appear in your SuperPages Pay For Calls ad which rings through to your regular phone line. Pay For Calls ads are integrated with and appear on the same search results page as SuperPages.com Pay Per Click ads.

The minimum bids range from $2 to $6 per call, depending on the business category. Calls are tracked and billed on a proven platform already in operation.

An additional value of Pay For Calls on SuperPages is the ability to leverage ads in local Verizon yellow pages directories.

Will It Fly?

The Kelsey Group estimated that by 2009, PPCall could generate between $1.4 billion and $4 billion in gross revenues. Jupiter estimated that search marketing would generate $16 billion in 2009. So if it takes off, PPCall could take one-quarter of the market.

Kelsey Group also reports that U.S. businesses spend $90 billion annually on local advertising. So it's worth going after a piece of the market. As with any new business model, there are always challenges.

With the business model barely underway, vendors are offering different products and pricing options; therefore, there is room for standardization. Some calls are sold at a flat rate and others are sold through auction-type bidding. It's anybody's guess whether PPCall will seriously challenge pay-per-click, and only time will tell. If phone leads are good for your business, it's worth a try.

About The Author

trademarkSEO specializes in organic search engine marketing services aimed at increasing traffic, boosting conversions and achieving lower customer acquisition costs. The company's complimentary SEO Guide to search engine marketing can be downloaded for free.

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