Pay-per-call advertising

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Pay-per-call (also called Cost-per-Call) is a Performance-based advertising model and compensation method. Pay-per-Call is similar to online Pay-per-Click (PPC) advertising. However, with Pay-per-Call instead of paying a fee per Click, the merchant pays the service provider a fee per Call for connecting the consumer to the advertised number. Pay-per-Call advertising was first introduced in the US around September 2004 and registered as a Trade Mark in 2005. Voice-contact is particularly-suited to local businesses, and to high-value and consultative purchases, where customers wish to talk to vendors before committing to buy. Given the high rate of reported click fraud, Pay-per-call is believed to be a better solution to connect potential customers to advertisers.[1] In recent years, the Pay-per-Call model has been experiencing significant growth and industry adoption, partly attributed to the growing popularity of web-enabled smartphones.[2]

Pay-per-call (PPCall) was originally a billing system generally known as "900" calls (because most pay-per-call services used numbers in the 9xx range), where the phone company bills the caller a fee which is passed on to the owner of the number called. This service used Premium-rate telephone numbers predominantly for billing phone sex services on a pay per minute basis. This well-established practice and related applications are described by the Federal Communications Commission [3] and elsewhere.[4] Pay-per-Call in the performance marketing industry is an inverted variant of Premium Rate telephone numbers. Here, the phone company charges Advertisers to receive calls, instead of billing callers. The pricing model of Pay-per-Call is a Cost Per Action model.

Pay Per Call System[edit]

Call Tracking is a key part of the technology that enables Pay-per-Call - The ability to track calls in a similar way to clicks, allows Pay-per-Call providers to account for results and to reward partners for performance, on a revenue-share basis. A majority of original direct PPCall providers used web forms or optimized landing pages to help generate phone calls. On web based advertising platforms, merchants define their relevant key terms, choose desired categories and a geographic area for the ad to appear (local, regional or national). From there, they create their ad, containing their company name, address, a short description and a trackable toll-free telephone number of the PPCall provider, which redirects to the advertiser's actual phone number.[5] This type of advertisement is popular with Yellow Pages companies. The PPCall provider system is a virtual PBX hosted phone operation used to track, record, forward and account for every call, and captures all caller details – caller info, date and time, calling number etc. Calls can be automatically forwarded to the advertiser or sent to a call center where potential prospects are qualified before being passed along to advertisers.[6] Average call durations in 2012 were reported by one Pay-per-Call network to last between 2 and 4 minutes.[7]

Pricing: The cost per-Call charged to the advertiser is usually higher than the cost per-Click. Pay-per-Call providers claim the higher charges are because calls convey higher consumer intent to purchase - and - have a higher conversion rate than Clicks. Providers also report that captured call-data is more detailed and actionable than click-related data.

Online & Offline: Pay-per-Call is referred to as a ‘bridge’ between online and offline advertising, because unlike Pay-per-Click it extends beyond online advertising - it can be used Offline (in traditional media such as print, TV and outdoor). Pay-per-Call is also available to businesses that do not have a website, because it routes prospective customers to a telephone, instead of to a website. [8] [9]

ROBO: Pay-per-Call enables a growing number of ‘ROBO customers’ (customers who ‘Research Online and Buy Offline’) to dial telephone numbers, or Click-to-Call links that they see online. Calls usually terminate ‘Offline’ on the advertiser’s fixed or hand-held telephone/device.

Pay-per-Call and the Mobile web: In 2010, Click-to-Call functionality was extended for smart mobile phones so that the user could connect by clicking the phone number link, without having to dial the number manually. Web-enabled Smartphones and their inherent click-to-call and search functionality are an important driver behind growth projections for the Pay-per-Call model. .[10] [11] [12] [13]

Pay-per-Call and Affiliate Marketing: In recent years, leading Affiliate Marketing Networks have proceeded to introduce Pay-Per-Call solutions. Pay-per-Call is reported to be one of the fastest growing areas in the affiliate marketing industry (2012-2013).[14] [15]

History[edit]

  • August 2004 - a Jupiter Research study commissioned by Ingenio [16] showed that 48% of participating businesses were interested in Pay-per-Call and that they would pay 5 to 15 times more for a phone call over a click.
  • September 2004 - Ingenio introduced Pay-per-Call in North America, via Miva.[17][18] Other early market entrants in the US included (in no particular order) VoiceStar,[19] Estara,[20][21] SPG solutions,[22] and ThinkingVoice.[23]
  • April 2005 - AOL introduced Pay Per Call ads in the US [24] and UK-based Callgen launched Pay-per-Call in Europe.[25]
  • September 2005 - MIVA extended their Pay-per-Call offering to the UK, using Ingenio’s technology,[26] (Miva later suspended their Pay-per-Call offering in the UK). In September 2005 Thomson Directories also announced plans to enter the Pay-per-Call market.[27]
  • Later in 2005 - Google tested (but have not rolled out) Pay-per-Call as Google Connect.[28][29][30] Yahoo! started experimenting with the model at around the same time, (purportedly using Ingenio’s platform).[31]
  • February 2006 - Kelsey Group projected US "pay-per-phone call" revenues to reach $3.7 billion by 2010 (Pay-per-Call forecasts were initially considered “bullish” by some in the industry, but over time have proved to be “directionally accurate”). According to the Kelsey Group’s finding at the time, over 70% of SMBs would prefer a phone call than a click in a performance-advertising model.[32]
  • March 2006 - TradeDoubler announced its acquisition of Pay-per-Call start up Advertigo.[33] In January 2007 TradeDoubler introduced a Pay-per-Call service called ‘td Talk’ to their Affiliate network.[34] (in 2009, Tradedoubler merged ‘td Talk’ with their ‘td Pull’ affiliate network and renamed the combined offering as ‘td Affiliate’).
  • October 2006 - Estara acquired by ATG for an estimated $48m [35]
  • April 2007 - Skype launched ‘Skype Prime’ a Pay-per-Call service in Beta.[36]
  • Summer 2007 - Google acquired telephony capabilities via Grand Central for an estimated $50m.[37][38]
  • August 2007 - VoiceStar acquired by Marchex for an estimated $28m.[39]
  • November 2007 - Ingenio acquired by AT&T for more than $300m.[40]
  • July 2010 - Skype launched a new Pay-per-Call system, using Marchex (VoiceStar).[41]
  • August 2011 - Google converts all AdWords phone numbers to click-to-call numbers.[42]
  • July 2012 - Google reported it is driving 15 million calls a month to US advertisers.[43] Forbes estimated that calls in this model “could explode as more businesses understand the benefits of pay per call versus other forms of advertising” and that “Pay per call could be 10x bigger than pay per click”.[44]
  • January 2013 - Search Engine Watch article expects US mobile ad revenues could reach $4.2 billion in 2013, and Mobile ad rates to rebound most pronouncedly in ad formats such as Pay-per-Call.[45]
  • June 2014 - Invoca,[46] a pay-per-call software platform, hits the 100 employee mark and has shown 64% revenue growth since 2010. Formerly known as Ring Revenue, they provide the platform most pay per call networks like Exact Match Media [47] and Click2Call Network [48] use to manage their campaigns. This indicates large-scale growth through the pay-per-call channel.

Patent & Patent Application examples[edit]

  • 2000 - A number of US patent applications have been filed by Ingenio since 2000. Including one for “Method and apparatus to provide pay-per-call advertising and billing”.[49] Additional applications by Ingenio are mentioned here.[50]
  • 2004 - Google’s senior research scientist filed US patent application covering Advertisements for devices with call functionality, such as mobile phones.[51]
  • 2005 - Callgen filed UK patent application UK0504574.5 covering the application of Pay-per-Call in Affiliate Marketing. A number of individuals applicants filed US application US7689466 for Dynamic Pay Per Call listings (Patent was granted in 2010), and US application for an Integrated pay per click and pay per call listings (patent 8239273, granted 2012).
  • 2007 - Local.com granted patent 7,200,413 relating to a referral model such as pay-per-call listings.[52]
  • 2007 - RingRevenue files patent 8,238,540 for managing a pool of phone addresses.[53]
  • 2008 - Click Interconnect Inc auctioned a number of U.S. Click-to-Call and Pay-per-Call patents.[54]
  • 2012 - Local Corporation Granted U.S. Pay-Per-Call Patent 8,306,208 for a pay-per-call Enhanced Directory Assistance method or system.[55]

References[edit]

  1. ^ ”Click Fraud Will 'Compel' Pay-Per-Call Adoption", Media Post Publications,June,2005.
  2. ^ "Pay-Per-Call growth attributed to mobile". MediaPost 12 April 2012. 
  3. ^ "Guide to 900 Pay-Per-Call and Other Information Services". Federal Communications Commission. 
  4. ^ "Pay-per-Call Telephone Service (900 Numbers)". eNotes, Encyclopedia of Business. 
  5. ^ ”How Pay per Call Works", Search Engine Watch,February,2005.
  6. ^ "Understanding Pay Per Call Marketing" Affiliate X Files October 2009
  7. ^ "Pay-Per-Call and Call Duration". Search Engine Watch, 12 April 2012. 
  8. ^ "Tracking Calls Like Clicks". LinkTrust, August 2010. 
  9. ^ "Businesses With No Website Statistics". Statistics Brain, 5 September 2012. 
  10. ^ "Google Launching PPCall Mobile Ads",The Next Web,January,2010.
  11. ^ "Pay-per-Call and the growth of mobile search". Carat, 10 October 2012. 
  12. ^ "Mobile and SMBs Are Driving Pay-Per-Call Growth". BIA/Kelsey, 10 April 2012. 
  13. ^ "Pay-per-Call mobile advertising guide". MobyAffiliates. 
  14. ^ "The rise of pay per call in the UK affiliate market". Econsultancy, 28 October 2011. 
  15. ^ "What’s New in Affiliate Marketing". Smart Insights, 27 December 2012. 
  16. ^ "Ingenio - Company Profile". CrunchBase. 
  17. ^ "Miva - Company Profile". CrunchBase. 
  18. ^ "Miva first to offer Pay-Per-Call in 2004.". Miva.com, 2005. 
  19. ^ "Voicestar - Company Profile". CrunchBase. 
  20. ^ "Estara - Company Overview". Bloomberg BusinessWeek. 
  21. ^ "White Paper, Pay-per-Call best practice". Estara, 2005. 
  22. ^ "SPG Solutions Enters PayPer-Call Arena". MediaPost 15 March 2005. 
  23. ^ "ThinkingVoice - Company Profile". CrunchBasae. 
  24. ^ "AOL Launches Pay-Per-Call Ads". MediaPost 11 April 2005. 
  25. ^ "UK's first cost-per-call service". Econsultancy, 14 April 2005. 
  26. ^ "Miva to offer Pay-per-Call in UK". LBi / BigMouthMedia, 18 August 2005. 
  27. ^ "Thomson to join the pay-per-call players". Brand Republic, 13 September 2005. 
  28. ^ "Google Begins Test of "Click-to-Call"". Search Engine Watch, 22 November 2005. 
  29. ^ "Google Tests 'Google Connect'". Shimon Sandler, 27 October 2005. 
  30. ^ "Google tests out Click-to-Call AdWords". Greg Yardley, 23 November 2005. 
  31. ^ "Yahoo Local Running Ingenio Pay Per Call?". Search Engine Journal, 8 November 2005. 
  32. ^ "Kelsey Group Forecast". Kelsey, 15 February 2006. 
  33. ^ "TradeDoubler buys Pay-per-Call technology". TradeDoubler, Press Release, 27 March 2006. 
  34. ^ "TradeDoubler presents td Talk – pay-per-call". Nikke Lindqvist, 30 January 2007. 
  35. ^ "ATG to Acquire Estara". Internet Retailer, 19 September 2006. 
  36. ^ "Skype Prime – Pay Per Call". Click News, 23 April 2007. 
  37. ^ "Google To Acquire GrandCentral". TechCrunch, 24 June 2007. 
  38. ^ "Pay-per-Call and Google’s acquisition of Grand Central". Blog, Rob Webb, 3 July 2007. 
  39. ^ "Pay Per Call Company VoiceStar Acquired by Marchex". TechCrunch, 9 August 2007. 
  40. ^ "AT&T Buys Ingennio". InternetNews.com 19 November 2007. 
  41. ^ "Skype Skype today announced it expands pay-for-call offerings for advertisers.". Skype, 20 July 2010. 
  42. ^ "Google Adwords makes Pay-per-Call easier". HotSpot blog, August 2011. 
  43. ^ "Nikesh Aurora, Google driving 15 million calls a month to US advertisers.". Google - Q2 2012 Earnings Call July 19, 2012. 
  44. ^ "Pay per call could be 10x bigger than pay per click". Forbes, 22 July 2012. 
  45. ^ "Expected growth of Mobile Pay-per-Call advertising". Search Engine Watch, 25 January 2013. 
  46. ^ "Invoca, Hits 100-employee mark". 
  47. ^ "Exact Match Media". 
  48. ^ "Click2Call Network". 
  49. ^ "Ingenio Patent Application No 10/872,117". 
  50. ^ "Ingenio Pay Per Call Patent Information". Vinny Lingham, November 2005. 
  51. ^ "Google's Patent Application for Click-to-Call Advertising". Search Engine Watch, January 2006. 
  52. ^ "Local.com Granted Patent". Web Pro News, July 2007. 
  53. ^ "Patent US8238540". Google, August 2012. 
  54. ^ "Interconnect Auctions Click-to-Call patents". The Free Library, September 2008. 
  55. ^ "Local Corporation Granted U.S. Pay-Per-Call Patent". BusinessWire, November 2012. 

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