Can I make money just leasing out my number?
Yes, you technically can, but most people don’t make that much. Shared Use (meaning breaking down and renting out numbers by the area code or some geographical territory) can be made to look like a get rich scheme by just running the numbers. However, if that was true and it really worked the way you’re imagining it when you run the numbers, shared use companies and their owners would all be rich.
People often think they’re the first ones to think of the shared 800 business concept. But it’s been around for about 20 years and 20 years later, some are successful and make money, but none make the money you would expect and many more than you would expect, never get off the launch pad or break even. That can’t be all because they don’t know what they’re doing.
I think that’s because running the numbers makes you feel good, but it never works the way you plan or hope. Even building something around a GREAT number takes an awful lot of work and there are a lot of road mines. And 800 number owners always think that getting the number is the really hard part and the key. I don’t mean to be the bearer of bad news or discourage people who are excited about the 800 number business. But the truth is that even though you think your number is so great that it has to be easier or that you are better at marketing so you can do it, be very careful, and don’t spend a lot of money before you are making any money.
Why can’t I find someone good to market it for me?
There are a couple companies that will give you lip service in terms of marketing it for you, but the bottom line is that it’s much harder to market numbers and get other people to understand the value than people who already understand the value ever believe. And people who are having success, marketing numbers always have way more numbers than they are ever going to be able to market. So why would by market yours for just a percentage of the money?
These companies also tend to be a little dishonest at times. Maybe that comes from working in a business that has very few standards or any clear oversight. The vanity number business is very small and tends to fly under the radar most of the time. People outside of the business also don’t understand it so imagine if you were selling used cars without a book value to people who don’t know much about cars. It’s easy to take advantage of people so be very careful.
Advice to anyone getting into the vanity number business
Here are a few simple tips if you’re trying to get started in the vanity # business.
1. Start small
2. Make money before you spend much
3. Pick a niche industry that you know and have contacts,
experience and credibility in
4. Stick to just one main number and maybe an alternate or
two
5. Develop as much value added collateral material as you can
6. Think long term and don’t over hype yourself on the
potential
8. You make more money building a business around a number than you do just marketing it to other people
9. The more of an actual business you build around a good number the more money you will make
I’ve written several posts about the dark side of the shared use business but it certainly can make a valuable asset more valuable and usable more by businesses and therefore better serve the public at least in theory. The reality may fall a little short or even turn into a way to abuse the public. But I’m certainly not against shared use if it’s done right.
It’s a fun business and I’ve loved it for years. But it’s really not the get rich quick business everyone always thinks at the beginning. You can’t usually farm it out to someone else and get very much from it and unfortunately it takes a lot more hard work than it looks like it should at the beginning. But if you want to work at it, a good 800 number can grow and be a great asset.
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Bill Quimby (678 comments.) says:
June 16, 2009 at 9:37 am
Paul,
You can give all the best examples you want and logic to justify the industry. That’s your job. But those individual examples aren’t the typical shared use scenario.
Even the most honorable person in the shared use business figures out that getting customers is hard work and it’s easier to get a bunch of numbers and just put a message that this number is available and wait for people to request it.
This combined with the fact that the inventory is cheap to carry usually leads people to get a lot more numbers than they have customers for, which slips into hoarding.
And when that honda dealer is at your mercy and has no choice but to rent that number from you, there’s no competition or market forces to keep the price down. The incentive for you is to raise the price and provide very little service. Even the most “honorable” person realizes this and whether they intend to or not, it’s almost impossible to be pure and ignore your own best interest and put your honor above feeding your family.
So you can claim that there are good shared use people, and I won’t disagree with that. It’s not that all the people in shared use are bad, but the industry seems to provide a lot of incentives to deviate from that pure ideal and those examples.
That’s why I say that putting yourself at anyone else’s mercy like this may sound good at first, but often ends poorly and isn’t as good as you make it out to be.
There are some people who have really developed one or a couple good numbers and created a synergy that helps everyone. But for every example of that, there are several more companies hoarding large volumes of numbers with less than 1 customer per number and charging as much as they can once a customer has committed to a number.
Bill
David Taylor Jr (1 comments.) says:
January 3, 2010 at 10:58 pm
Bill, thank you for your insight and experience. By trade, I am a domain investor, but am now delving into the toll-free business. And yes, you’re right! There’s no real benefit in brokering 800 numbers as SMS800 and other RespOrgs are cracking down on this activity.
Again, the key is building a business around this type of intellectual property.