Most small business startup books recommend that you obtain a 1800 number for your business, especially if you are running an eCommerce store.
But these days, long distance calling (including international) is mostly free or extremely cheap. In today’s age of cell phones and free unlimited long distance calling, is having a 1800 number really a necessity anymore?
Should encouraging more customers to contact your business via phone rather than going online to make a purchase be one of your goals?
Read on to find out!
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What Is A 1800 Toll Free Number?
A toll free number is just a regular phone number with a special 3 digit prefix that can be dialed from anywhere at no charge to the person placing the call.
Back when I was a kid, all toll free numbers started with 1800, but now you can find toll free numbers beginning with 1888, 1877, 1833 etc… Most of these numbers are universally recognized by the “older generation” as being free.
What’s also cool is that all 1800 numbers are “virtual” which means that they can be routed anywhere via the Internet. As a result, you can have a 1800 number connected to any phone line that is convenient for you.
For example, a 1800 provider will allow you to answer your toll free number from your office phone from 9-5 but forward to your cell phone after hours.
This makes phone based customer service extremely convenient.
How Much Does A 1800 Toll Free Number Cost?
The total cost of a 1800 number depends on several factors but the most important factor is the country of origin the number is assigned to.
In general, US and Canada numbers tend to be the cheapest but other countries like India are substantially more expensive.
For example, the cost of a 1800 number in the US can be as cheap as $5-10 month with per minute rates as low as 1 cent/minute. Some services like Grasshopper allow you to pay a flat fee of $29.99/month for unlimited calling.
Meanwhile, the monthly cost for a toll free number in India can be as high as a few hundred dollars per month.
Every call made with a 1800 number is charged in two parts. The first part of the charge is determined by where your callers are located. This is called the inbound rate.
The second part is called the termination rate and depends on how you answer your calls. In general, you can reduce your total cost of your 1800 number by forwarding all calls to a virtual phone but most service providers(in the US and CA) offer free termination.
Some 1800 number providers charge a flat rate based on the amount of call volume you expect each month. If you typically get a high volume of calls for your business, you may want to negotiate a lower rate by purchasing your minutes in bulk up front.
Do The Benefits Of A 1800 Number Still Apply?
1800 numbers were very popular back in the early 2000’s when long distance charges were still a big deal. But today, all long distance calls are pretty much free.
So what is compelling about having a 1800 number today? I’ve compiled a list of the commonly perceived benefits of having a 1800 number below.
The real question is whether they apply to your business and how much you value the benefits. Only you can be the judge.
A 1800 Number Leads To Increased Sales
According to studies (and common sense), if a customer is given a choice between dialing a 1800 number vs a long distance number, they will invariably call the toll free number first.
Statistics show that most customers purchase from the first company they call so it is important to get that first point of contact. But the million dollar question is how many people actually think like this today?
According to a study that Neil Patel conducted on the effects of a phone number on sales, he determined that merely displaying a phone number on your webpage provides a small lift in conversions (<1%).
A similar study determined that 64% of customers are frustrated when they can’t find a phone for a business online.
When dealing with two unknown companies, I’ll almost always call the company with the most professional and aesthetically appealing website.
The type of phone number is rarely the deciding factor whether I will shop at a business or not.
Regardless, it’s safe to say that displaying a phone number on your site is beneficial, but whether a 1800 number makes a difference is up for debate.
A 1800 Number Adds Credibility To Your Business
Consumers often assume that a toll-free number is associated with a large company so logic dictates that they will want to go with a more established player.
Again, I tend to associate credibility with the professionalism and aesthetic appeal of the website itself rather than through a phone number.
In an informal poll I conducted among my readers, almost everyone surveyed would not be deterred from shopping at a business if they didn’t have a 1800 number.
However, over 76% agreed that a 1800 number provides the perception of a more established business.
Please leave your opinion in the comments if you have one.
A 1800 Number Leads To Increased Order Value
According to studies, companies with 1800 numbers receive larger order sizes on average. But all of the research I found online was dated prior to 2011.
For our online store, I know for a fact that if I can get a customer on the phone, my conversion rate is nearly 90%. In addition, I have the ability to upsell the customer much more effectively via voice than from the website.
As a result, if a 1800 number leads to more calls than a regular phone number, it could conceivably increase the AOV for your business.
A 1800 Number Leads To Decreased Returns
According to studies (conducted prior to 2011), stores with 1800 numbers are less likely to have returns. Once again, I fail to see a correlation between product satisfaction and having a 1800 number.
Product returns are usually dictated by the quality of the product and its presentation rather than a phone number.
However, if you can often talk customers out of making a return over the phone or convince them to make an exchange, then conceivably having a 1800 number can reduce your refund rate.
A 1800 Number Is Convenient
With a 1800 number, you can accept calls on any phone line of your choice whether it be a cell phone or a land line and customers won’t know the difference.
While this is extremely convenient, these services are not limited to 1800 numbers. For example, Google Voice allows you to forward a call from one number to any phone of your choice depending on the time of day, and it’s free!
Ring Central provides unlimited free calling within the US and Canada for only $20/month.
A 1800 Number Can Track Your ROI
Tracking your marketing efforts and calculating your customer service ROI is easy with a 1800 number. You can create multiple, separate phone extensions for all of your marketing campaigns.
Then once the campaign concludes, you can go back and determine which phone numbers contributed to the most sales.
Did having a 1800 number boost conversions? Did the toll free number increase the number of international customers?
Most providers will allow you to easily create temporary numbers and track your calls.
A 1800 Number Facilitates International Sales
Even though domestic calls are mostly free for cellular providers, international calling still comes at a cost. As a result, a toll free international number may increase the number of calls that your business receives.
In addition, having a 1800 number may provide the perception that your business is global and serves international customers.
Whenever I see a non-US phone number on a website, I’m usually deterred from calling the company because I don’t want to get charged. Furthermore, I generally feel more comfortable dealing with companies based in the United States.
Having a toll free number on an international site can mask the fact that your business is in another country and facilitate a sale.
Do You Need A 1800 Number?
So the million dollar question is whether a 1800 number is inline with your business goals and whether the money spent on a toll free number is worth it.
These days, toll free numbers are fairly inexpensive so money is less of a factor. And looking online, a toll free number can be had for a small flat monthly fee that is less than $30/month.
Personally, I think that the answer depends on the nature of your business. These days, making a long distance call is more or less free, especially if you are on a cell phone.
As a result, purchasing a 1800 number depends on your target audience and what you are trying to sell.
Are your customers located close to your business geographically? Does selling your product require having a phone conversation with the customer?
Is a large portion of your business international? Do you want to come across as a global company to your customers?
Naturally, a 1800 number is required if your business relies heavily on voice communications to make a sale.
But there are other things to keep in mind as well. For example…
- Does your business have the necessary infrastructure to handle the additional call volume?
- Do you want to encourage customers to place orders over the phone or on your website?
- Does getting more calls increase your customer satisfaction rate and lower returns?
- Does getting more calls increase your AOV?
- Does your business have a large international presence?
Just keep in mind that answering phone calls to make sales is not easily scalable because it requires manpower.
Instead of focusing on making more sales via phone, can you invest more time and money making your website more automated instead?
For example with our store, we try our best to anticipate customer questions online so they don’t have to call us on the phone.
Recently, we’ve invested heavily into Facebook Messenger live chat support and chatbots to alleviate our customer support burden.
We’ve also written detailed FAQs and guides to avoid having to answer commonly asked questions. Truth is, as much as we enjoy speaking with customers, we would rather take less calls and rely on more automated methods of selling.
Having a 1800 number may encourage a customer to call rather than place an order online.
Our online store gets almost as many calls as we can handle and we don’t currently have a 1800 number. 60% of the time, customers call to ask simple questions that could easily be covered on the website.
With each call, we jot down the customer question and add it to the FAQ and our chatbot in hopes that we don’t have to answer the same question again. We also display the FAQ page prominently on the menu bar.
For our business, getting a 1800 number is currently a toss up. This isn’t to say that getting a 1800 number doesn’t make sense, but we are focusing our efforts on trying to reduce call volume rather than increase it without sacrificing customer support quality.
Questions For The Audience
- Is not having a 1800 number a deal breaker when contacting an online business?
- How much does having a 1800 number lend credibility to a business?
- Does having a 1800 number really matter to you when you shop?
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Steve Chou is a highly recognized influencer in the ecommerce space and has taught thousands of students how to effectively sell physical products online over at ProfitableOnlineStore.com.
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To stay up to date with all of the latest ecommerce trends, Steve runs a 7 figure ecommerce store, BumblebeeLinens.com, with his wife and puts on an annual ecommerce conference called The Sellers Summit.
Steve carries both a bachelors and a masters degree in electrical engineering from Stanford University. Despite majoring in electrical engineering, he spent a good portion of his graduate education studying entrepreneurship and the mechanics of running small businesses.
31 thoughts on “Do You Need A 1800 Toll Free Number For Your Online Business?”
I don’t think I’ll ever have a toll-free number. I’m a writer and blogger and so far, I’m just handling almost everything via e-mail and cell phone (which is rare). I personally love it this way and it’s working well for me. 😀
For me, 800 numbers doesn’t matter. As long as they have a number, its all good.
For my website, I only have a local number but I rarely get phone calls at this point. Most correspondence is via email only. If I get more contact, orders, etc, I may invest in a toll free number.
An 800 number is not essential for my business either. I handle most business transactions almost exclusively online.
Hi Steve, while I don’t need one, I will always choose an 800 when ordering or making a inquiry by phone. In fact, I don’t appreciate it when a company I need to call doesn’t have one. I vote yes for toll free numvers.
I agree. I do all of the above when looking at or dealing with any company. 800 numbers definitely benefits a business.
We discovered a great service called Toktumi, http://www.toktumi.com, for a toll free 800# number. They let you try an 800# for free for 30 days, only $15/month after that. It’s actually much more than just a toll free 800#, it’s actually a full hosted PBX system, which is great for connecting all of our office and cell phones. But if you are thinking about adding an 800# to your business it’s a great way to test the waters for free.
If I’m calling a business, I wouldn’t mind all that much not having a toll-free number, except for one case: waiting. If I’m put on hold or into a queue, I’m not sure I’ll wait more than a minute when not on a toll-free number. I just wouldn’t like the feeling of my phone bill going up as I’m waiting in your system.
So I’d say if you’re getting more call volume than you can handle, a toll-free number is still essential. If I can call your business and immediately speak to a real human who will be able to help me with my problem, I guess you’re right that a toll-free number isn’t as essential as it once was. (Although still preferred.)
A 1800 number is definitely preferred, but not as necessary as it once was. In any case, we’ll probably had one to our store eventually. It’s just not our top priority at the moment especially if it means beefing up our customer support staff.
nice post man also see my post on toll free numberes http://www.oceanofweb.com/useful/toll-free-numbers.html
I’m certainly not your typical customer. But if I have to call you, we already have a problem. At that point, it isn’t going to make much difference whether it is a toll-free number. Either you’re going to quickly try to fix the problem, or I’m going to go away mad.
In other words, a short call to a regular number might be better than a long call to a toll-free number, depending on the results of the call. I would have no problem with someone saying “I’m trying to fix this, but it might take a while. How are you doing on minutes this month? Would you like to move this to e-mail?”
One thing that really gets to me is being in a call queue and not getting something like “our current estimated wait time is approximately seven minutes”. When a company’s call queue tells me about the wait, I can decide whether to hang up and try back later.
Sort of off-topic: I was getting all sorts of automated calls on my (new) mobile number. Because of the plan, I figured out that one company had cost me about $16. So when they called again, I was hot. I waited for a real person, then I let the guy have it. Afterwards, I thought I should have been nicer, but at least his company stopped calling me.
Excellent point. I’d be frustrated as well if I was placed on hold. That’s a good thing to keep in mind in case the call waiting period gets out of control.
Our experience with 1-800 numbers has been that they absolutely increase credibility and people have a tendency of using them more often.
I think that even though long distance plans make long distance calling much more affordable (or even free) 1-800 numbers have been ingrained in the minds of consumers for so long that they will naturally look for them and call them more often than with a regular number.
So much so that even local existing and potential clients call us by default on our 1-800 numbers. This was the case even when we featured our regular number more prominently. We’ve since done the reverse and now make sure our 1-800 number is more visible.
All that said, you make a valid point about not using a 1-800 number if you are trying to reduce call volume because the use of one will usually have the opposite effect.
I’m just curious to see whether you have any data on the correlation of having a 1800 number versus sales. Did you find that a 1800 number noticeably increased your revenues? Did you have to staff more people on the phones as a result?
A bit inside the bubble here, but we typically see call volume raise between 20-30% when our clients effectively roll out a custom phone number. It can vary significantly with the type of number, of course, as a premium 800 number is much easier to remember than more generic digits, but response rates on most campaigns with a custom number will see an uptick. Sales increases are trickier to pin down but once you have a potential customer on the phone, I’d maintain that’s the best place to convince most of us the value of a product or service.
We work with a lot of growing businesses and there’s a lot of great information on your site we can recommend to them. Thanks for sharing your experiences!
I work for a 1800 number provider, and I’ve come to think it’s something worth trying out for any small business — as mentioned in the post, the cost of toll free numbers these days is really low, and you can usually try them free for some period of time before paying a dime. The benefits can be tremendous, not just in changing how your callers perceive you, but also in increasing your daily efficiency with newer features like voicemail transcription.
If a 1800 number doesn’t work out, you can walk away from it and at least you’ll know it simply wasn’t right for you. If it does work out, that could mean more orders, more satisfied customers, etc. — and that’s worth the relatively minor investment of time and money it takes to give it a try.
I’d say shop these services around, there are a lot of quality providers out there that can give you a good deal. You can always check us out at FreedomVOICE: http://www.freedomvoice.com.
I don’t have any hard numerical data to confirm that having a 1-800 number increases leads, sales or revenue, but there are clear indications that it does.
One example that comes to mind is that local partners and clients alike who initially called us on our regular number, over time migrated on their own to our 1-800 for future calls.
And local potential clients tend to reach us via our 1-800 even though both numbers are clearly provided on the “contact us” page of our website.
(More recently we included the 1-800 on all pages to maximize the effect)
As for having to hire new staff to handle the call volume, this is not a problem in our industry as our services cater to other businesses looking to advertise their brands, products or services. I can see how this might become problematic for businesses operating within a B2C framework.
Thanks for posting, the comments were very helpful. I have had a toll free number for 27 years and today I considered cancelling until I found this website. I decided to keep it now because I did not consider the fact that many people still have limited minutes on their cell phone plan. I do not want a customer to be thinking about their cheap phone plan while we are doing business on the telephone.
Great summary of the toll-free dilemma.
I believe that a toll-free number is an excellent tool to give your website visitors the respect and service they deserve to become your client, and soon loyal customer.
I work for a new online, toll free call solution, called the GreenCaller.
Our statistics with client show that using a toll-free call option, depending on your business sectors and your online presence/proficiency, the conversion rate increase varies between 0- 32% in the first month. Yes, I know that this is a great variation, yet reality. And it is true, some business experienced no significant change.
Interestingly enough, the most ‘toll-free productive’ business areas have been the ones with highly computer literate target groups, nice example is auto-hifi geeks. Yet most webshops and credit and insurance consultants experienced significant conversion increase.
According to our client survey, the 2 most important benefits of toll-free call options were:
1. A decrease in churn rate.
Especially during filling online order forms or contracts.
2. Great possibility of up- and cross selling to your customers.
As they talk to you directly.
I wanted to way in on this forum.
There’s a huge different between a 1.800 and a 1.800 vanity numbers.
1.800.LAWYERS, 1.800.FLOWERS & 1.800.CONTACTS are examples
of great brands!
I appreciate you for the information that you have shared. An 800 number is a excellent way to make your small business good specialized for a minimal cost.
I have come to think it’s something value trying out for any little company, the price of toll-free figures nowadays is really low, and you can usually try them 100 % free for some time interval before spending a penny.
I’m debating using a 1800 number as part of a call tracking service to properly measure my google adwords conversions. I’m in the service industry as I own a Chiropractic, Physiotherapy & Massage Therapy clinic. All of our customer’s are local and value “local and independent”. My worry is that when a potential patient comes to my website and see’s a 1800 number, will this intimidate them? Or do the benefits of the making informed decisions about my google adwords and listening to calls for training purposes outweigh by fears? Any thoughts or input would be greatly appreciated! -Nick
You can actually track conversions using a local number. Phone tracking providers such as Callrail offer both local and toll-free numbers. So you’re not forced to have to use a toll-free number if a local number is more valuable to your business.
If you need any AdWords related help, feel free to reach out – we offer free audits of existing campaigns.
Yes i agree toll free number is very necessary. If the company is newly started it will increase the credibility of your company.
I agree that more experienced and savvy internet shoppers may not care if you have a toll free number, but the average shopper on the internet is neither.
I have run many eCommerce websites over the years. I have tried it both ways and the 1-800 number definitely increases the credibility of the website, leading to up to 50% higher conversion rates. The reason for that is that it certainly DOES increase the number of phone calls and phone calls convert at a much higher rate than anything else – usually 50-75% for online stores. If you have the time and resources to answer calls, you want those phone calls!
I am also of the opinion that it makes a business seem larger and more legitimate. The more legitimate you seem, the more trust you earn, which leads to more conversions, as well. In my opinion and experience, it’s certainly worth the relatively small investment once you have the traffic to support the small additional expense.
I welcome you for the data that you have shared. A 800 number is a superb method to make your independent company great specific for an insignificant expense.
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