Pay-Per-Call: A Viable Lead

Pay-per-call advertising presents an alternative to PPC models; the platform offers better ability to track conversions. A new The Kelsey Group report, “Calls, Clicks & SMEs: Driving Leads from Web to Phone” discusses the pay-per-call model.

The report estimates pay-per-call will generate gross revenues of between $1.4 and $4 billion. The projection is contingent on several market variables.

Pay-per-call ability to track results makes it a cost-per-lead model. PPC ability to identify results is lower as it offers no direct communication from the consumer to the advertiser.

Pay-per-call pricing is a point of contention. Both flat-fee and auction-modeled costs have been structured, with proponents on both sides. “We don’t know exactly how the pricing will play out. There will probably be multiple models, flat-rates, and auction,” Greg Sterling, program director for The Kelsey Group told ClickZ News.

A third option is the tracking model. Not exactly pay-per-click, this model uses an analytics package to report on how many calls were generated from an online ad.

Pay-per-call has long existed in direct marketing and other channels. It was introduced to the Web by FindWhat.com (now MIVA) and Ingenio last September. The platform is a natural one for Small- and medium-sized businesses (SMEs). “The phone is well suited to small business,” Said Sterling. “Small businesses are used to dealing with customers over the phone. Consumers are also used to picking up the phone.”

Customer Contact and Call Rates After Lookup
	Print Yellow Pages	Internet Yellow Pages	Local Commercial Searches
Metric	References	References (lookups)	Geotargeted commercial searches
Source	Yellow Pages Association	Yellow Pages Association	Kelsey Group Forecast; Ingenio data
Customer contact (%)	83%	67%	32%
Customer call (%)	61%	73%	25%
Net call rate, 2005 (%)	50%	49%	8%
Source: The Kelsey Group, 2005