InternetUniversity: Pay Per Call

By Anthony Muller

One major roadblock to local search becoming all it's cracked up to be is the fact that lots of small- to medium-size businesses don't have a Web presence worthy of the name. The best many of these merchants can manage is a virtual calling card or a souped-up Yellow Pages ad. But while the mom-and-pops struggle to figure out how to devise trackable ways of selling their wares online, there's another option available for those among them that want to tap into the ever-growing stream of online shoppers: pay-per-call.

Rumors of the telephone's demise as an instrument of commerce are slightly exaggerated, or at least premature. For the vast majority of small, local businesses, it's still the main conduit to customers. San Francisco-based Ingenio was the first to put together a platform that could connect Web surfers with phone-based merchants. So far, the company has formed partnerships with search player FindWhat, online Yellow Pages provider go2, and the new-and-improved America Online, which hopes that pay-per-call's uniqueness will help differentiate AOL from rivals Google, Yahoo!, and Microsoft's MSN.

True, the cost per acquisition that merchants pay for the service  how's $2 to $20 a call sound?  are a tougher sell than the pennies they'd be paying per click. But that's not considered exorbitant in a business like real estate or mortgage banking, where the offers can change faster than a Web site can be updated and the ability of a live person to close the sale is the stock-in-trade.

Other big pluses for the platform are the immediacy and visibility of its results. Pay-per-call's tracking mechanism  in place of a landing page URL, you need a special phone number that redirects to the merchant's regular number  makes it easy to see which calls originated from the online ad and which came from other sources. Conversions from pay-per-call tend to come faster than pay-per-click, too.

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