Unlike its sibling, pay-per-click, pay-per-call does not require an advertiser to create and maintain a website. Rather than enticing web-surfers to click to a web site, pay-per-call ads are designed to get people to pick up the phone, with advertisers paying only if a potential customer calls.

Pay-per-call leverages the power of web searching to match buyers and sellers, especially on a local level, and then allows the two parties to conduct business in a way both parties are comfortable with -- the telephone. For more than 50 years, businesses have been encouraging consumers to pick up the phone and call -- from newspaper ads and the Yellow Pages to TV and radio commercials to direct mail pieces and catalogs. Pay-per-call ads move this basic tenet of the buyer-seller relationship into the next generation.

While a number of companies are developing pay-per-call services, MIVA is the first-mover on this powerful marketing tool. The company distributes its' pay-per-call platform to a range of content and directory websites. Advertisers purchase keywords so that when a person enters a search on a site they receive listings of ads in categories -- much like headings in a Yellow Page directory.

With pay-per-call, SME's are able to continue to do business in a way that they and their customers are comfortable, but they are also able to reap the benefits of the internet.

While most consumers have no problem buying a CD or a sweater from an online retailer, they are hesitant to purchase complex or high-ticket items such as a car or a life insurance policy without the personal contact of a phone call. But these same people are very likely to search for a car-dealer or financial advisor online. Pay-per-call bridges the gap, enabling local insurance brokers, real estate agents, travel agents, and others to get on the web-savvy consumers' radar screens', or more accurately, their computer monitors.

Pay-per-call is also a great tool for national brands with local rooftops -- companies looking to generate local leads against a national brand, such as car rental agencies.

Dollars and Sense

For small businesses with small marketing budgets, pay-per-call is a very attractive option. Advertisers pay only for calls received, which literally means that there is zero percent ad dollar waste!

And when a consumer picks up the phone to make the call to the retailer or service provider, he or she has most likely already researched the product and is ready to transact.

According to Kelsey Group, incoming calls result in sales more than 45 percent of the time. Research has also shown that customers who pick up the phone are ten times more likely to make a purchase than those who click on a link.

In effect, pay-per-call is the tech-savvy grandson of direct response advertising. Pay-per-call ads serve a similar function as commercials on cable table, but they are much more highly targeted with higher conversion rates.

And unlike an ad placed in the Yellow Pages or a newspaper, pay-per-call ads can be scheduled so that they only appear when it is convenient for the advertiser -- for example, during business hours, or during a sales promotion.

Getting Started in Pay per Call

Ready to give pay-per-call a try? Here are four tips to help you get started.

1. Figure out how much you can afford to pay per incoming phone lead. It's fairly simple. Begin by determining the value of the average sale made (a $2,000 cruise ship ticket? a $1,200 per year auto insurance policy?). Next decide what a lead is worth to secure that business. Remember that statistically, roughly one in two phone calls converts to a sale. Here's an example: A tire dealer's average sale is $800. He determines that for a 25 percent margin on that sale, or $200, he is willing to spend 10 percent, or $20. Given a one out of two conversion, he should be willing to bid $10 per call. (Most providers have a minimum bid and other fees. With MIVA, for example, the minimum bid is $2 and there is a $10 annual fee per listing).
2. Determine key words. Consider testing keywords, and categories to see what is most effective. "Duluth car rental?" "Arizona insurance?" "Des Moines salon?" "Caribbean cruise?" etc.
3. Determine time constraints and high and low sales periods. One of the great things about pay-per-call is that it can be turned off during peak times, so as not to overload the people answering the phones. This helps ensure that employees aren't too harried, and that potential customers don't get put on hold for ages.
4. Select a service provider. You might want to consider a provider with the ability to manage both pay-per-click and pay-per-call through a single platform or a single account manager so as to maximize your marketing resources. For companies with a web presence, consider a service that enables you to manage storefront ecommerce and desktop applications through one account manager. Large group accounts, such GM dealers, should also look for geo-targeting ability.

The Competitive Edge

Pay-per-call is just beginning to take off, with new companies entering the space every day. Bid prices on pay-per-call keywords, while more expensive than the pay-per-click, are currently low. And the return on investment is excellent.

As people spend more and more time online, advertisers will continue to invest more in paid search. Because publishers are always interested in offering users new functionality while generating revenue, an increasing number are adopting the pay-per-call platform. The increased competition will drive bid rates higher, which means that now is the time to take advantage of performance-based marketing's next wave.

For advertisers interested in joining the pay-per-call revolution, the best bet is to find a provider that can offer a high quality platform combined with superb customer service to help navigate the landscape. MIVA, for example, offers its pay-per-call customers full service, including the infrastructure, know-how, and superior paid search experience.

Society these days is primed to "call and act now!" Consumers are comfortable with the 800 number, direct marketing model. Pay-per-call simply takes the next logical step -- merging the remarkable paid search capabilities of the internet with the good-old-fashioned, personal touch of a phone call. Whether used alone, or in conjunction with a pay-per-click program, pay-per-call is a sound investment of your marketing dollars.