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Should Local Businesses Use A Local Or A Toll Free Number?

Should Local Businesses Use A Local Or A Toll Free Number?

Should Local Businesses Use A Local Or A Toll-Free Number?

Is a business better off using a local prefix or a toll-free number? Those who argue in favor of local prefix numbers defend the practice based on the argument that many people want to do business locally. However, the world has changed a great deal from the days when you were on a first name basis with your local merchant, so evaluating the pros and cons of this mindset is a worthwhile exercise for businesses of all stripes and sizes.

Area Code Proliferation

In 1947 there were 86 local area codes with most U.S. states having only one or two codes.

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Today there are over 275 and it seems at times as if they are multiplying like rabbits.

Take Southern California, for example. For decades, area code 213 was the sole L.A. area code. Today, L.A. includes 213, 310, 424, 323, 562 and 626:

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New York isn’t just 212 anymore; it’s been cleaved to include 718, 347, 917, 212, 516 and 914. The point is: sometimes it’s difficult to remember what exactly is a local prefix, and what isn’t.

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Area code confusion
In addition to adding new prefixes, consumer confusion is further exacerbated by the way area codes are added. There are two ways this occurs:

1. Area code splits, where the cities are divided along seemingly arbitrary lines that only the phone company understands the logic of and

2. Area Code Overlays, where BOTH area codes share the same geographic area, but now, instead of one area code there are two. In Los Angeles both 310 and 424 share the exact same geography, as does 718, 347 and 917 in New York.

Appearance Counts
This phenomenon isn’t the only thing that has changed in recent years. With the advent of toll-free and now the Internet, local businesses – even those of the mom and pop variety – are operating beyond what were previous local borders. The flip side of appearing “local” is that a business that uses a local prefix can also appear to be small or, worse, fly-by-night. Furthermore, the Internet’s impact on commerce has conditioned consumers to be used to dealing with businesses far and wide, not just those that are local.  If a local business only conducts walk-in business – say a dry cleaner, for example – then a local prefix may make sense. Nonetheless, the overwhelming majority of businesses would actually benefit from a toll-free number. If a local feel is important, the business should simply state they are local and identify a landmark they are near in their advertising. For instance, an advertiser might say, “Call 1-800-277-5800 or visit us at the corner of Pico and Rexford, across from the Hillcrest Country Club.”

Can’t Block Caller ID to a Toll-Free Number
Furthermore, for marketers interested in data mining, there are other significant disadvantages to using a local number versus a toll-free one. Consumers can easily block their local number, making it impossible to monitor your inbound leads. Hence a local marketer may not be able to determine the demographics of their inbound leads or remarket to such callers unless they capture all of their contact information over the phone.

In contrast, toll-free numbers reveal almost 100% of all callers numbers (even if they have caller ID blocked). With a toll-free number the marketer can see the data on every caller by appending their inbound home telephone number and cross-referencing it against available consumer data such as home ownership, age, gender and income data, etc. On the other hand, such data is limited for inbound calls from cell phones, though that is changing. But, once a marketer does have the inbound lead’s contact information, even if the caller doesn’t buy, the marketer can strike while the iron is hot and direct mail such consumers an offer, knowing that, unlike random direct mail, the consumer has expressed an interest in their product.

More Calls More Sales
Finally, toll-free numbers that are exceptionally memorable are available to marketers. In contrast, it is difficult to get enough memorable local numbers to effectively track advertising.

Research shows that 800-prefix numbers that have easy-to-recall sequences such as “one-thousand” or repeat digits such as “5555” can generate 20 to 60 percent more inbound leads. Even web-based marketers can benefit from including a toll-free number as many consumers are simply more comfortable speaking with a live human being as opposed to conducting business virtually.

Add it up and it’s clear that, save for the local business relying on its location to generate walk-in business, the number to dial in to create the greatest volume of business isn’t a local one: it’s toll-free.

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