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Frequently
Asked Questions
What
is a Toll Free Number?
How do toll-free numbers work?
Why are Toll Free Numbers so popular?
Benefits of toll free numbers for
small businesses
Brief History of Toll Free Numbers
Some facts about toll free numbers
Why have we run out of "800"
Numbers?
What is a Toll Free Number?
This
probably seems a little basic, but a toll free number is a telephone
number that can be called at no cost to the caller, because the
recipient pays for the cost of the call. Also referred to as ‘800’
numbers after the original area code, although toll free numbers
today can start with the area codes, 800, 888, 877, and 866. The
area codes 855, 844, 833, and 822 have also been reserved for toll
free activation in the future if and when necessary.
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How
do toll-free numbers work?
A
toll free number just forwards to or or redirects to a regular local
number. No special equipment or additional line or installation
is required. When a call is placed to a toll free number, the Local
Exchange Company (LEC) queries the SMS800 Database to determine
the inter-exchange carrier (long distance company) responsible for
carrying the call. The inter-exchange carrier then picks up the
call, applies the appropriate features or routing, creates a call
record for billing, and routes the call to the terminating number,
trunk ID or circuit ID to which the toll free number is programmed
to ring to. This entire process takes milliseconds and is virtually
transparent to the caller.
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Why
are Toll Free Numbers so popular?
Consumers
like them because they're free to call. Advertisers like them because
customers are more likely to call. Companies also like them because
they are portable and they create a more national presence and they
have additional capabilities in terms of reporting and routing that
local numbers don't have. Another major reason for their popularity
is that they have dropped so dramatically in price and ease of use.
When they were first introduced they were expensive and hard to
get. But now they are so cheap and simple to set up that even the
smallest part time business or residential user, almost can't afford
not to use one.
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Benefits
of toll free numbers for small businesses
Portability
- One of the most important benefits of toll free numbers for small
businesses is the ability to change the ring to number, called portability.
If you move your business or your needs change, it's easy to change
the ring to number, usually by just calling your carrier at no cost.
Too bad you can't move your whole business around that easy...
Larger company image - Toll free numbers create a larger more significant
corporate image, even for the smallest home based business.
Expanded marketing reach - A local number is ok if you only market
locally. But if you want to market outside your local area, a toll
free number is practically a necessity for business in the US.
Scalability - Another benefit for smaller start up businesses is
that you basically just pay for the usage or calls to your toll
free number. This means that a new or small business with little
usage will pay very little for their service and their bills will
only increase as their usage and business increases. Too bad all
of your business expenses don't work like that!
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Brief
History of Toll Free Numbers
1-800
numbers were developed in the late 60s by AT&T as a convenient
way for businesses to pay the tolls for their customers who contacted
them. (Remember when everyone thought long distance was so expensive?)
As the service became more popular, toll free subscribers began
finding new and innovative uses for the service. As usages and popularity
began to grow companies began to realize that consumers preferred
to do business with companies with 800 numbers.
By 1984, when the Bell System was dismantled by the Justice Department,
there were over 3 million 800 numbers in service by AT&T, and
new long distance carriers were clamoring to provide 800 service.
These carriers were assigned blocks of 800 numbers with common NXX
(prefixes), so the phone numbers available depended on the carrier
you spoke to and if you left your carrier, you would have to change
your 800 number. The numbers weren't portable.
One of the steps
in creating a more competitive toll free market, was to implement
the current SMS/800 system which allowed true portability of 800
numbers so you could change phone companies without having to change
your number. This gave toll free number subscribers much more ownership
rights and made the popularity and value of good 800 numbers sky
rocket, so much so that within 18 months of the introduction of
number portability, very few of the 7 million 800 numbers were left
for new subscribers.
Then after rationing
800 numbers, the telecommunications industry chose 888 as the next
toll free area code, introducing another 8 million new numbers to
the toll free pool (less a couple hundred 888 numbers that were
held out of the pool at the request of the 800 owner). 888 numbers
have been in use now for several years and are fairly well accepted
and understood by a large part of the country as equivalent to 800
numbers. But as 888 numbers began to dwindle, 877 and later 866
area codes were introduced as well. 855, 844, 833 and 822 are also
reserved for toll free use as they are required.
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Some
facts about toll free numbers:
90%
of Americans say they use toll free numbers.
More than one-third of Americans estimate that they make 60 or more
toll free calls per year.
Demand for new
toll free 888 numbers for business and personal uses averaged above
238,000 requests per month, since introduction of the 888 code on
March 1, 1996. That's in excess of 2,800,000 new 888 numbers per
year. This led to the creation of 877 numbers.
Toll free calling
generates an estimated $157 billion in annual sales of goods and
services in 1997.
In addition,
experts say that 84% of current Internet users rely on electronic
media to search for product or service information in order to make
a purchase. Being able to locate the 800 number on the Internet
greatly improves the success rate of any Internet ad or Web site.
The average phone order from a catalog can be 30% to 70% higher
than the average mail order.
As telephone
buyers generally use credit cards, they will order more merchandise
and higher ticket items 95% of the time.
A productive
ad featuring an 800 number can generate approximately 30% more orders.
In a study,
paper ads that were almost identical were displayed and monitored.
One group had an 800 toll-free number and the others didn't. The
toll-free number ads received six times the number of calls as did
the regular long-distance listings. It also seems that this will
hold true regardless of the socioeconomic level of the caller.
If you want to decrease returns by as much as 50%, use an 800/888
number on product literature. This encourages customers to call
in and resolve difficulties with a trained expert.
Fund-raising
organizations have increased their response approximately 25% by
adding that 800/888 number in commercials, print ads or direct mail
pieces which previously used only addresses.
888 numbers
were introduced in 1996 after several months of rationing. 877 was
introduced in 1998, and 866 numbers were later added in 1999.
If you're a
small start up and you're not spending a lot of money in your advertising,
you have to be realistic and may have to make do. It would be silly
to insist that someone in Florida or Georgia needs a powerful snow
blower if they hardly ever get much snow. But if you lived in Buffalo
or Vermont, and you were getting a lot of snow (meaning you're doing
a lot of advertising) it would be stupid not to get a good snow
blower. If you're doing serious advertising, you need a serious
"800" number that will help increase the response rates
to all your advertising.
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Why
have we run out of "800" Numbers?
Their
popularity and value are obvious and have made 800 numbers an absolute
necessity in business. That combined with the limited availability
caused a run on them in 1995 when they were rationed until 888 numbers
were released. Additional toll free area codes 877 and 866 have
also been released since then because of the continued demand for
toll free numbers. So the "800" area code has essentially
been used up a couple times over. Add to that the fact that some
adult phone services have become proficient at sucking up every
800 number the instant they are returned to the pool in order to
make money from the wrong numbers.
These businesses
have literally hundreds of thousands of 800 numbers, and in order
to avoid being accused of hoarding and brokering, they basically
never sell or release any numbers for anyone at any price. Finally,
many phone companies don't follow the guidelines and quietly tuck
any real "800" numbers and keep them for themselves or
their biggest customers. All of these things make it virtually impossible
to get real "800" numbers from any phone company any more.
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