Comparisons6 min read

Toll Free Vs. Local Numbers: Everything You Need To Know

One phone showing local and another phone showing toll free number.

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As of 2024, nearly 31 % of businesses have switched to VoIP (Voice over Internet Protocol) phone systems, with many adopting toll-free numbers while others prefer local numbers. Both these virtual phone numbers come with distinct features. Understanding the differences is crucial. After all, the type of number you choose defines how your business connects with your customers. It can also significantly impact your brand image and customer engagement.


What's the Difference Between a Local Number and a Toll-Free Number?

Local numbers provide a strong regional presence and help your business to get local trust and support. In contrast, toll-free numbers eliminate calling costs for customers, which broadens a business’s appeal across the country.

Local Number

A local number is a telephone number tied to a specific geographic area through its area code, reflecting a local presence. This number allows businesses to establish a community-focused identity, fostering trust and familiarity among local customers.

Local numbers traditionally come with landline services when you set up a telephone line for your phone or service. However, today, you also have the option to get virtual local numbers from VoIP phone system providers. They allow you to maintain a local presence while you can manage your business from any part of the world. 

Pros of Local Number

Local numbers establish your business as a local entity in a particular region, which leads to increased customer engagement and loyalty.

When comparing toll-free vs. local numbers, local numbers offer the following advantages:
 

  • Local Presence: Local numbers give your business a recognizable local identity. With this, the customers trust you more and are more likely to engage with your business.
  • Better Customer Satisfaction: As you provide a familiar contact point for the customers, they feel more connected to your business.
  • Professional Image: A local number demonstrates your commitment to serving the local area and establishing a strong and reliable brand image.
  • Simplified Market Targeting: With a local number, businesses can more effectively target their marketing efforts to a specific geographic area. It boosts the impact of your promotional campaigns and advertisements.
  • Faster Response Times: When you reach the customers using local numbers, they’re more likely to respond to your calls.

Cons of Local Number

Local numbers can restrict a business's reach. It can limit the interactions to a specific geographic area, affecting the business growth in the broad market.
 

  • Geographical Restriction: Local numbers can limit your business’s ability to connect with people outside the specific geographic region.
  • Call Costs for Customers: While local customers enjoy low-cost calls, those outside the geographic area may face higher charges. This could discourage the long-distance customers from reaching you.
  • Limited Brand Perception: A local number might give the impression that your business is small or only serves a particular area. This perception can limit your appeal to larger clients or those looking for a company with a broader presence.

Toll-Free Number

A toll-free number is a telephone number that allows your customers to reach you without incurring any charges. These numbers are often recognizable by their prefixes, such as 800, 888, 877, 866, 855, and 844. When customers call your toll-free number, instead of the caller, the call cost is charged to the called party.

Pros of Toll-Free Number

A toll-free number removes the call barrier for customers when they reach your business. This approach represents you as an easily accessible, customer-centric business, regardless of where your customer is located.
 

  • Nationwide Reach: Unlike local numbers, toll-free numbers don’t limit you to a specific geographic region. You can showcase your presence across the country and make your business accessible to a wider range of customers. 
  • Cost-Free for Customers: Customers don’t have to pay a penny to reach you; instead, you cover their bill. So, undoubtedly, your customers are more likely to reach out for inquiries without hesitation.
  • Improve Brand Image: Toll-free numbers are often associated with larger, established companies. So, these numbers can give your business a more professional look and feel. 
  • Better Conversion Rates: When customers know that they can call a business for free, you’ll get more frequent calls. This can eventually lead to higher conversion rates.
  • Memorable and Marketing-Friendly: Vanity numbers, a type of toll-free number that spells out a word or name, can be used as a marketing tool. You can create a unique and distinctive phone identity that is easy to remember.

Cons of Toll-Free Number

While toll-free numbers widen customer reach, they can lead to higher operational costs and potential misuse by callers.
 

  • Increased Operational Costs: As your business will have to cover the cost of incoming calls, maintaining a toll-free number can be more expensive than local numbers.
  • Potential for Misuse: Since calls are free to the caller, some users may misuse them for prank calls or unnecessary inquiries.
  • Limited Local Presence: Businesses using only toll-free numbers might miss out on the local appeal of having a local number. A toll-free number might make a business appear detached from local community concerns.

Toll Free Vs. Local Number at a Glance

Aspects 

Toll-Free Phone Numbers

Local Phone Numbers

Geographic Reach

Nationwide or international without geographical boundaries

Limited to a specific local area or region

Caller Cost

Free for the callers

Local rates for local callers. Applies long-distance charges for non-local customers.

Business Cost

Higher, as the business covers call charges on behalf of callers

Lower, especially with VoIP providers.

Idea For

Customer support, national marketing, and large-scale operations.

Local businesses, community services, localized markets

Marketing Appeal 

The broad and expansive reach

Targeted niche markets with local appeal

Operational Flexibility

High, with various routing options

Medium, due to geographical limitations

Brand Image 

National or global presence

Strong local presence and community integration

Accessibility 

Easy for anyone, anywhere

Best for local customers

What Is the Best Choice For Your Business - Toll-Free or Local Number

Toll-free numbers are ideal for nationwide service and brand expansion, while local numbers excel in community presence and local marketing.

When To Choose Local Number For Your Business

Choose a local number for your business in the following scenarios:
 

  • If your primary customer base is located in a specific city or region
  • If your business provides service predominantly in a particular area.
  • If you’re a small business or startup looking for a cost-effective communication solution to interact with the locals.
  • If you want to create a brand image that represents dedication to serving the local community.

When To Choose Toll-Free Phone Number For Your Business

Choose a toll-free number for your business in the following scenarios:
 

  • If your business serves customers across the country or you have plans for national expansion.
  • If you want free and accessible ways for your customers to reach you.
  • If you’re launching a marketing campaign and want maximum customers to reach you.
  • If you want your business to be viewed as the larger, established company.

Conclusion

Toll-free and local numbers serve distinct features. Both these numbers are ideal for your business. However, you must choose the one that aligns with your business requirements. The toll-free numbers are ideal for a business prioritizing cost-effective communication solutions for customers. On the contrary, local numbers are a better option for businesses that focus more on local presence.

You can get both local virtual numbers and toll-free numbers on Calilio. Our virtual number goes beyond the basics of providing local presence and cost-effective communication solutions for your business. It’s a feature-rich business communication solution for all types of businesses - local, national, or international.

Frequently Asked Questions

Should I use both a local and toll-free number?

Yes, you can use both a local and toll-free number. Calilio offers to use these numbers from a single platform. As such, you can establish a local presence while offering your nationwide customers to reach you efficiently.

Are 1800 numbers better than local numbers for business branding?

1800 (toll-free) numbers are great for national branding. However, local numbers are an ideal option if you want to brand your business in specific regions.

Can toll-free numbers replace local numbers for regional targeting?

No, toll-free numbers expand national reach but cannot replace the local numbers for regional targeting. This is because locals often prefer dealing with businesses specifically determined to serve them.


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