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CitySearch Launches Pay-Per-Call    - MediaPost

by Ross Fadner
Pay-per-call, a relatively new type of local search advertising, got a boost Monday when InterActive Corp.'s local search engine,
CitySearch, unveiled a new product allowing merchants to pay only for leads generated via telephone calls.
The new product, PFP Calls, is a joint creation of CitySearch and Internet telephony startup CIRXIT. Participating marketers receive
a toll-free phone number, which CitySearch will show wherever the merchant's contact information appears--not just on PFP (pay for
performance) ads, but also natural search results, the merchant's information page, and CitySearch's "Best of" listings.
Advertisers set a monthly cap on the amount they're willing to spend; CitySearch then places listings accordingly. Once the
maximum is reached, CitySearch replaces the toll free number with a local, non-metered number that will only appear on the
merchant's information page.
Briggs Ferguson, company CEO, said placement is determined by a "multivariable calculation," combining monthly spend, the
amount remaining in the monthly cap, rate of performance, distance, and relevance.
Ferguson noted that the company has been planning a pay-per-call product for several years now. He said tests conducted two
years ago were promising, but the company opted to roll out its pay-per-click product first.
Ferguson said he expects pay-per-call to perform better for certain advertisers such as high-end restaurants, hotels, spas, and
certain categories of home services. He said the product will most likely not attract mid- to lower-tier restaurants and lower-end retail
CitySearch, which has distribution deals with AskJeeves Local, MSN, and Yahoo!, is currently looking into the possibility of offering
the product on its partner sites. Ferguson also said the company is exploring the possibility of licensing the technology out to other
With its new product, CitySearch becomes the second official provider of pay-per-call services, and the largest distributor. Ingenio,
another Internet telephony startup, unveiled the first pay-per-call format in August, signing a network distribution deal with
FindWhat plans to roll pay-per-call out throughout its network, and currently offers the format on BizJournals.com. CitySearch
intends to deploy its pay-per-call product across city pages covering 141 local markets.
Greg Sterling, Program Director for The Kelsey Group, a local market research firm, said the new pay-per-call offering "signals that
the concept has traction.“
He noted that the CitySearch distribution deal is different from the FindWhat/Ingenio deal because FindWhat is essentially a
sponsored listings network provider--its network is not consumer-facing.
Sterling added that CitySearch has FindWhat-like distribution deals with search providers, including AskJeeves, narrowing the line of
distinction between destination sites and distribution networks. He expects other networks to roll out similar pay-per-call offerings in
the near future, particularly if the format is able to attract local advertisers.

  Posted by Ross Fadner on December 7, 2004
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