Today, I had a brief call with George Garrick, CEO of Jingle Networks, which operates the service 1-800-FREE411. The Jingle team has been aggressively wringing costs out of the system for months trying to reduce the cost per call as much as possible.
In some locales, where there are fewer advertisers, Jingle has removed the operator fail-over. This means the cost of fielding the call drops substantially. We have estimated this cost previously at less than $0.03 per call at volume.
Garrick suggests Jingle is aggressively pairing the revenue of a call with the expense associated with handling it, as well as “dialing up the recognition rates as much as possible with Nuance’s latest release.” Further, after some prodding, he says that, “Our blended rate is significantly below $0.10.” He wouldn’t be specific, but other sources tell us Jingle is automating north of 65 percent of its calls.
We have good numbers on the types of advertiser feeds and distribution deals that Jingle has cut with Idearc and others. We estimate its average revenue per call is close to $0.07 today.
What does this mean? If we’re right about our numbers, it means Jingle is very close to breakeven on a gross margin basis — close, as in this quarter.
Garrick would not confirm or deny these figures, but did say, “We’ll have some interesting news at the Kelsey conference next week and Pelorus the following.”
You heard it here first … Jingle — per-call (or gross margin) breakeven.