There are a lot of people who believe that ad-supported directory assistance cannot succeed. As evidence they cite the history of “operator assisted yellow pages,” which has been uniformly a failure with the exception of Yellow Pages Group’s “Hello Yellow” service. Most recently, inFreeDa (1800-411-Metro) has discontinued service. However inFreeDa competitor Jingle Networks (1800-FREE411) issued a press release that reported apparent strong growth:
- 1-800-FREE411 is now processing nearly three percent of all U.S. directory assistance calls;
- In August, 1-800-FREE411 processed more than 13 million calls made by more than four million consumers;
- Daily call volume has exceeded 500,000 calls; and
- Jingle has processed more than 72 million calls since its introduction in September 2005.
The scuttlebutt is that “free 411” services have a very high “burn rate.” Jingle previously raised nearly $30 million from inventors. It’s not clear that current ad models or the current volume of monetized calls will provide the necessary revenue to cover costs. (Over time, the potential is there.) Jingle, however, has exposed impressive response rates, with high per-call monetization ($40 in the case of a satellite TV vendor). And CEO George Garrick cited satisfied advertisers and low churn on a briefing call on Friday.
Notwithstanding that monetization is an ongoing challenge, the consumer case for free DA is clear and was bolstered by recent Jingle-sponsored research findings from comScore (2,500 consumers):
- 71% of consumers strongly believe that 411 services should be provided free of charge;
- Only 5% are satisfied with and do not mind paying for their 411 service;
- 74% limit their 411 usage due to cost factors;
- When asked what, if anything, they dislike about DA services, 65% selected “high cost”;
- 88% said they would probably or definitely use a free 411 service more frequently than a paid 411 service; and
- More than 40% either do not know how much their mobile phone provider charges for DA or believe it is less than the actual fee.
Jingle CEO George Garrick says that his company is handling 12-13 million calls per month. (Wireless is the sweet spot.) Right now, there’s no category search option on Jingle — it’s coming Q1 of 2007. Jingle competitor 1800-San Diego does have such an option currently but it’s very awkward. For example, I called the service for “hotels” in Oakland, CA (they have other cities) and was transferred by a live operator to a text-to-speech list of hotels. In the abstract that’s an appealing proposition.
Prior to hearing the list I was played an ad for Hotels.com (good match). But as a practical matter while the ability to hear a list of hotels was marginally helpful there was no way that I could make a decision unless I randomly picked one or picked a brand I was familiar with. There’s a long way to go here. The fact that it’s a free service isn’t enough to justify a mediocre experience.
Category search (if it’s done well) is going to be much more effective for both consumers and advertisers than the notion of playing a competitor’s ad when I call for a particular listing. If I’m calling for a category lookup I’m open to hearing paid ads or offers in a way that I wouldn’t be in a conventional “what city, what listing?” context. And category search starts to turn DA into voice-enabled mobile local search.
Related: Recently BellSouth Operator Services added category search as part of its “enhaced directory assistance” offering over traditional landlines. It also announced closure of one of its call centers because of increased use of cell phones and the decline of landline DA.