Local Numbers vs. Toll Free: Why Local Presence is Better

Mightycall Team
Mightycall Team
11 July 2016 Business Insights

Updated: 2017.04.14
In this article, we cover:

  • Why a business number is a business owner’s must-have;
  • Impact of a toll-free number on connectivity;
  • Customer perception of local vs. national companies;
  • When a local number is more appropriate;
  • Difference between freephones and local area codes in terms of features.

Local vs. Toll-Free: When Local Presence is Better

Despite all the recent sociological hype about how tech-savvy youngsters are making phone calls obsolete, telephony is still a basic channel for business interaction. Website widgets, social media and VoIP may be handy for some of your customers, but conventional telephone calls are unrivalled in terms of ease of access and reliability. Many people use them just out of habit. Thus, a start-up owner is likely to ask the following questions: Do I really need a business number? And if I do, should I opt for a toll-free? We’re happy to answer these.

Why is a virtual phone number good for business?

As long as the importance of having a telephone connection doesn’t require extensive argument, let’s quickly enumerate the advantages of a virtual phone number for business:

  • Once you buy the number, it’s always at your disposal. Moving to another location, switching to alternative provider, losing your personal cellphone… Changing your contacts on all your marketing materials is no longer required.
  • It’s easier to stay connected. No need to monitor multiple phones — calls are forwarded to any desired endpoint (or to several locations simultaneously). If you subscribe to a good virtual phone service, all other communicational channels can be integrated: turn your portable device into a powerful communications hub.
  • Your contact data becomes consistent. An ability to assign extensions to specific departments/employees/divisions saves your customers the trouble of remembering several numbers or figuring out which of the published contacts to use. It’s also possible to activate as many inbound phone channels as required.
  • Extra privacy and security are gained. Publishing your personal contact data in open sources is a terribly bad idea. A virtual business number helps to separate work from private life; it drastically reduces personal vulnerability to scams and pranks.
  • Your promotional activities project a professional attitude. SOHO owners sometimes use their personal emails and numbers for promotion: business cards, websites, even billboards. A free email service domain and a mobile number are equal to admitting that your work alone. With a virtual business number, a corporate social media profile and a professional email address, your business looks more trustworthy.

So, your company has (or plans to purchase) a virtual phone number. But should you make it toll-free? Of course, a freephone is indispensable for fully-fledged call centers, helpdesks and globally operating online companies. However, it doesn’t mean that a local presence has no benefits. On the contrary, in some cases a local business number can be a better alternative, especially for small business owners. Now let’s discuss certain aspects which can render a local number more advantageous both for the customers and entrepreneurs.

Connectivity

Obviously, toll-free numbers are immensely useful if your customers are located all over the country or even all over the globe. It’s always a good idea to remove an additional barrier between your services and the prospects: they won’t have to calculate how much it would be to get in touch with your office; they won’t have to decide whether it’s worth the money.

Another situation is when your business is fairly small, but has a certain number of international connections. An initial desire to supply a free of charge calling option to help your overseas partners may be misleading.

Firstly, you will quickly find out that international calls are expensive ― no business benefits from increased communications expenses, right? Secondly, it may be impossible for foreign callers to get through to your North American number for free (depending on the specific country and number provider) or it may require additional arrangements / incur extra charges. Thirdly, your foreign partners are probably used to paying for their long-distance calls ― they will contact you via phone only if the matter is truly urgent, so lack of a freephone will hardly affect international deals.

However, make sure that you provide alternative means for instant interaction. Thankfully, we have the internet with its Voice-over-IP capabilities. Again, a VoIP can also be integrated into your virtual call-processing system. And if you get regular calls from only a few specific regions (say, where your customers or suppliers reside), then consider buying a local overseas toll-free number. You will be able to forward calls to your location via a virtual phone system and the charges will be considerably less.

On the other hand, if you operate within a local area code territory or if your company has only a few regional divisions, getting one or several local virtual phone numbers might be a better option than a national freephone. Modern virtual phone systems support multiple phone numbers connected to a single system, thus creating a unified communication environment for consistency and efficient management. Why is local presence better? It’s all about customer perception.

Customer perception

In the eyes of an ordinary person, a toll-free number is a sign of a large company, which operates on a (inter)national scale. While for some entrepreneurs projecting such an image may be a clever marketing move, others risk to lose a portion of local clientele. Spontaneously, an 800 prefix implies that a company is situated somewhere far away even if the office is right next door. There is also a possibility that a first-time caller may think that his call will be directed to a huge corporate (or even worse ― outsourced) call center. Why is that a problem? Well, have you ever tried calling the tech support of an international IT corporation? One of them is especially notorious for total lack of competence and long response times. That’s exactly what a caller might think when he sees your toll-free virtual phone number. Even more so, if your marketing campaigns emphasize a “serious global business” image.

But that’s not all. According to a survey by SinglePlatform, 86% of consumers consider local businesses a better alternative to national/international companies in terms of quality. While respondents believe that national chains offer more competitive pricing, 72% of participants find it acceptable to pay more to local companies if they provide better quality. What’s more, 79% believe that local businesses are more reliable.

This opinion is quite justified ― as a rule, local companies are small-to-medium, which means that an individual customer is much more valuable for them. Additionally, when you operate within a limited area, reputation among the locals becomes a crucial asset to preserve.

Advertising

In terms of marketing, a toll-free virtual phone number becomes a valuable instrument when promotion campaigns are not concentrated in a limited locale. Online companies ― their physical location may be obscure and not actually relevant ― tend to purchase 800 numbers to enable clients from various areas contact them free of charge. With this strategy implemented, distant customers are considerably more likely to contact you via the phone.

Another point is willingness to answer a call. If for some reason ― target marketing, surveys, quality control, various confirmations ― you have to call your customers regularly, toll-free business numbers are again at a disadvantage. Surveys show that when people decide whether to answer an incoming call or to ignore it, local numbers inspire more trust and confidence. Just to your knowledge, let’s compare how consumers react when receiving calls from various types of numbers.

A Software Advice survey unsurprisingly shows that 8 out of 10 respondents would be “extremely unlikely” to answer calls from unknown 800 numbers. This reluctance is explained by massive proliferation of telephone spam calls. What is more, cellphone number databases are sold and bought by various shady individuals ― a scammer can call to pry out some personal information and use it later for criminal purposes. As for local numbers, 40% of the respondents indicated that they are likely to respond to a call from numbers with out-of-state area codes.

It means that consumers generally have twice as much trust in calls from numbers with out-of-state area codes in comparison with toll-free numbers. And a logical conclusion to the survey follows: the vast majority of the respondents would be “somewhat” or “extremely” likely to answer calls from local area code numbers.

Features

All in all, for a small business operating within a single city, local area number seems a more feasible solution offering tangible benefits. A geographically-diverse company with a small number of locations is likely to benefit from purchasing multiple local virtual phone numbers and uniting them under a single call-processing system. Toll-free option is more suitable for online enterprises catering for customers on a national scale.

It seems quite logical, but some small business owners still opt for a freephone due to multiple sophisticated features usually included in a package. This avenue of though poses a risk of bearing unnecessary expenditures: soon enough the owners discover that their communication costs have soared instead of an expected reduction.

While it’s true that quality virtual phone services pack toll free numbers with a host of features such as flexible forwarding, porting, caller ID and more, the same applies to local numbers as well. Better providers offer a toll-free number as an optional feature, which can be activated for an extra fee regardless of a chosen rating plan. Consequently, local virtual number users have exactly the same range of available features as their freephone-connected counterparts. Premium services such as an auto-attendant with custom voice menu, call masking and screening, flexible user and extension options, dashboards and detailed communication analytics ― you name it.

A toll-free number is not a bad thing at all. It allows for exceptional connectivity with a geographically-scattered target audience and projects the image of prosperity and serious attitude towards business. Surveys show that detecting an 800 contact number on a corporate website considerably increases the conversion rate. True enough: online companies have to utilize every possible opportunity to make their business look reliable.

However, as long as your clientele is concentrated within a single area code, a local virtual phone number is a far better option. Just make sure you offer a number of alternative options for getting in touch with you from distant locations: click-to-call widgets, call-back requests, instant messaging and so on. And yes, modern cloud-based call management solutions offer integration with all the above-mentioned tools, so you can monitor multichannel inbound activities from one place ― a web platform or a mobile application.

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