Marchex Adds Call-Based Advertising Services with VoiceStar Acquisition

Marchex, an online advertising company and publisher of local content, will acquire VoiceStar, a provider of call-based advertising services, including pay-per-phone-call and call tracking, for local advertisers, for $28 million.

The acquisition of VoiceStar adds call-based services to Marchex’s local online advertising platform. In addition, the move adds more than 100 local advertiser aggregators, including Comcast, The Cobalt Group, and YellowBook USA, to Marchex’s current partner roster, which already included AT&T and Yellowpages.com.

VoiceStar also increases Marchex’s ability to directly monetize its proprietary network of Web Sites, lessening its dependence on third parties and increasing the revenue yield from its Web sites through call-based advertising units which tend to have higher rates then pay-per-click listings.

Marchex believes that providing advertisers with call-based advertising options, in addition to search-based marketing tools, is a prerequisite to success in the local advertising channel. According to Piper Jaffray, only 42 percent of the estimated 20 million small to medium-sized businesses (SMBs) in the United States have Web sites and many others are still are at the early stages of online marketing. As a result, call-based advertising will continue to be a priority for local advertisers, further evidenced by a recent Kelsey Group survey reporting that 71 percent of local advertisers would rather pay for phone calls versus clicks.

"We believe that call-based online advertising is not only a key extension of local search, but is also an important driver to close the gap between the vast number of consumers searching locally and the small percentage of local businesses currently advertising online," says John Keister, Marchex's president and chief operating officer. "Phone calls have been, and will continue to be, a predominant way in which consumers connect with small businesses. Providers that deliver both search- and call-based solutions will be in a tremendous position to expose online advertising to the millions of SMBs who are not yet online."

VoiceStar’s technology generates custom, trackable phone numbers for advertisers. Whenever an advertiser’s phone number is dialed by a consumer who sees a relevant advertisement (online or offline), the calls are routed through VoiceStar’s servers to the advertiser. From that point, the call is tracked, monitored, recorded, and billed. The technology supports multiple advertiser implementations, including click-to-call, Web form-to-phone and other call-based products.

VoiceStar’s call-based offerings and technology will be delivered through Marchex Connect, the company's local online advertising platform. With it, ggregators will now have expanded integrated search- and call-based offerings to present to their large base of local advertisers. In addition, national advertisers will be able to  target their ads locally and measure the offline revenue driven from their online marketing using call-tracking.