Pay-per-call complements DRTV

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A new channel for lead generation and capturing sales is on the market. Utilizing pay-per-call to capture sales from DRTV customers who are more comfortable on the telephone is an approach that complements businesses' existing online shopping processes.

Pay-per-call is adding new dimensions to direct advertising. For small- to medium-sized businesses, an e-commerce site isn't a realistic or affordable alternative. Internet behemoths like Google, Yahoo and AOL and Verizon's online yellow pages offer the capability to generate leads. Pay-per-call looks set to grow at a pace similar to pay-per-click. Market researcher Kelsey Group
projects that it will become a $1.4 to $4 billion industry by 2009.

"Pay-per-call allows businesses to make more effective use of their DRTV spots, because it captures a segment of customers who prefer to do business via the telephone, even though they might have been driven to the website by a DRTV ad," said Michael Ferzacca, CEO of pay-per-call provider Advanced Interactive Sciences. Pay-per-call allows advertisers to purchase calls to their business (as opposed to clicks to their Web site) from targeted, online ad listings.

The model is similar to pay-per-click advertising, in that businesses can bid for prominence in search results, but instead of driving leads to a businesses e-commerce site, they are driven to a phone instead; the phone lead from the pay-per-call ad becomes the billable event, rather than a Web site click.

The Kelsey Group, Princeton, NJ, estimates that incoming calls convert to sales 45 percent of the time versus 3 percent for pay-per-click. The average cost per call is over $5.

Pay-per-call works best in service industries where the phone is the preferred method of interaction with customers, or in situations where the purchase is complex and demands live contact with a knowledgeable salesperson.

San Francisco-based Ingenio, Inc., one of the early providers of the model, displays an 800 number in the ad, and then forwards calls to the number to the advertiser. Ingenio recently announced an agreement with Microsoft that enables Ingenio Pay per Call listings on Windows Live Search for mobile. One drawback is that the advertiser must have staffing to answer the calls or not run the advertising when the business is closed.

Advanced Interactive, Oldsmar, FL, takes a different approach to the pay-per-call market. Advanced Interactive focuses on businesses that already have a strong online presence and helps them enhance current lead generation or sales channels by adding a pay-per-call component. Because Advanced Interactive virtual agents handle the calls, advertisers do not need staff to take orders or collect lead information.

"People search at all times of day and when they're ready to buy, you want the call to be answered, so our virtual agents are ready 24/7/365," Mr. Ferzacca.

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