Small businesses expanding their business into new local and global markets are doing so through virtual numbers. These provide more flexibility than traditional phone numbers because there’s no hardwired connection.

Virtual numbers, which are sometimes called direct inward dialing (DID) numbers, allow you to reach distant customers and add a national presence to your business, even if you’ve just started to expand outside of your home market.



What is a Virtual Phone Number?


Virtual phone numbers are cloud-based numbers that allow a business to be reached without dependence on traditional landline networks. For more than a century, telephone numbers were tied to the traditional public switched telephone network (PSTN). This network depends on copper cabling to send incoming calls nationally and internationally.

With PSTN, numbers are tied to physical hardware by the phone company, and there isn’t a lot of wiggle room thanks to older the analog technology. When you make business calls on a PSTN line, the call is passed through miles of copper wire and is switched at local exchanges. The signal finally arrives at the intended location sometimes with delays and static, and as long as you’re on the line, the circuit remains open.

With virtual phone numbers, the internet is used to connect specific numbers to phone networks without the need for a traditional line or exchange. There is very minimal physical hardware with a virtual number, so incoming calls can be answered on any device that connects to the cloud.

The audio signal from the customer’s phone is broken down into data packets and transmitted similarly to how other data transfers occur like email or a webchat. Softphones, mobile phones, and standard desk phones receive this information and the internal software converts the data packets back into audio signals.

Your business purchases as many virtual numbers as it needs from a VoIP service provider to reach locals in various markets. Each number is easily managed through VoIP software, and local area codes, 800 codes, and international numbers are all assignable to your business. The software also enables businesses like yours to accept calls based on business requirements.

Want to receive calls past 5 PM on the East Coast after the business hours of a call center are over? The virtual phone number software automatically routes inbound customer service calls to the West Coast call centers instead, which are open later.


How Does a Virtual Phone Number Work?

virtual phone number

Virtual phone numbers follow the same rules as traditional ones. Local and national numbers have 10 digits, which includes the area code, the three-digit exchange, and the four-digit subscriber number. Virtual numbers use the internet to connect calls, but the number still bridges the connection to PSTN lines. This means that customers who look to reach your business do so with their standard phones.

This connection is created via a VoIP gateway, which works as a bridge between the internet network and the PSTN. When a customer is texting or makes a call to a virtual number, the call is forwarded to that specific number through software. The voice information from the traditional telephone is converted by this software into data packets, which are then transmitted to a VoIP friendly device on your end.

On your end, there’s a lowered hardware requirement; you only need a fast internet connection and a device like a desktop, laptop, or smartphone to receive the call. There’s no need to be connected to the copper wire network, which brings with it long-distance fees, expensive installations, and hardwiring requirements.

There are four main types of virtual phone numbers businesses use.

  • Vanity Numbers – These use catchy alphanumeric phrases or numbers that make it easy to remember your brand.
  • Toll-Free Numbers – These are national numbers that customers use to reach a brand from anywhere without long-distance fees.
  • Local Numbers – Local phone numbers use specific area codes to make a business appear more local, even when located far away.
  • Local International Numbers – Similarly to local numbers, local international numbers make a business appear to be local to overseas markets.


Limitations of Traditional Phone Numbers

With traditional PSTN lines being chained to copper wires, a business has to do a lot more to achieve the same connections that they would have with virtual numbers. PSTN is limited to one number, one line, so call centers would be required to purchase multiple lines to keep their agents receiving phone calls.

These numbers are also hardwired, so businesses can’t distribute their inbound calling services across multiple call centers using the same dial-in number. If you’re going to have a center in Tuscon, AZ, and another in Edison, NJ, you’ll have to have specific numbers for the calls being made to each location. The PSTN network is worldwide and has a massive install base, but VoIP removes the shackles of needing specific hardware for specific connections.


Why Do You Need a Virtual Phone Number?

There are several unique benefits for virtual phone numbers. For smaller businesses, these numbers are often used when the business owner doesn’t want to give out personal data or a personal number. Virtual numbers ring any compatible phone, and most services even allow for text messaging and voicemail. All of this is managed with the same packet-switching technology that is used with other internet-based services. There’s no need for maintenance of telephone wires and there are no open circuits to account for as calls are made.

There are several other reasons to consider virtual phone numbers for a small business.


Link Business Locations with One Phone Number

With a virtual number, several locations around the globe use a single, centralized number. If a customer in a particular timezone needs help, he or she gets it from agents in their area of the world. Using extensions with virtual numbers is also possible, so if a customer needs more specialized help, they’re connected to the right department. This is done even when the initial number’s center is located hundreds of miles away from the extension.


Access to a Wider Pool of Talent

There are no physical limitations when it comes to opening up a phone center around the world with virtual numbers. This means that your business phone system links up customers with their right agent, no matter the point of origin or the agent location. Since virtual numbers are independent of traditional PSTN and PBX hardware, agents that are on the road receive calls on their smartphones and laptops. With this kind of connectivity, customers are easily connected with agents that have previously helped them.

Matching the point of origin with a call center in the area is much easier as well. The United States and Canada are filled with regional dialects and local call centers that tackle local cases make it easier for agents to understand customer needs. With local virtual numbers, businesses easily match specific calls with agents that speak the dialect or slang. Even if they are located hundreds of miles away, the caller sees the area code and thinks the call is routed locally.


Allow Employees to Go Mobile

Virtual numbers deliver more flexibility for employees outside of the office. For example, if a receptionist has to work remotely thanks to a sick child, he or she still receives any calls directed to the company. This is done via desktop or mobile apps. Since virtual numbers come with software for call management, it’s easy to use call forwarding or call routing to connect with other departments.

Some VoIP software allows these workers to call transfer from device to device. A call received on a softphone is quickly sent to a smartphone or cell phone when the employee needs to change locations. When an employee has a scheduled callback, he or she goes about their business without the need to wait by the phone. Thanks to 2020’s COVID-19 pandemic, this became important because virtual numbers allowed employees to receive calls from home, even when they were social distancing.


Provide Dial-in Numbers for International Markets

Some products thrive overseas, and one of the best ways to expand into foreign markets is by providing customers with a local number to reach your organization. Virtual numbers aren’t limited to U.S. area codes and 800 numbers. You can also purchase international numbers from some providers for your foreign customers to reach you.

With virtual numbers, it’s easy to set up a call center in a region like Nova Scotia and receive calls from customers based in foreign markets like Italy. The caller won’t have to dial long distance, and the call center routes these types of calls to agents that are well-versed in Italian. To the caller, there’s no indication that they are dialing out of the country, and you’ll provide a strong customer service experience to those who reach your brand from foreign markets without the need to open local call centers.

Since this technology routes all of the calls to a single number, it provides a way to guarantee that international markets have a localized dial-in number where customers reach the business and the department that they need to speak to and get their issues dealt with quickly.


Measure Performance Level Easily

In marketing or sales, you need to be able to keep track of the number of calls that you receive, especially if you are taking calls from multiple campaigns. During the lifetime of a project, it’s easy to assign the campaign a specific number so that tracking the inbound calls for the campaign is simplified. Where did the call come from? With call tracking software, numbers are assigned to customers from websites so that you track their entire journey.

With a virtual phone number, it’s easy to heatmap success in various markets. For example, if callers dial into your number in the 515 area code more often, this is an indicator that your campaign may have more Des Moines callers. Maybe the campaign in that city could transfer well into another area to increase sales.


How to Get a Virtual Phone Number

Whether you’re seeking out a toll-free or a local number, most providers get you set up with virtual business numbers during the signup process. Typically, they charge per phone line, per month and port over old numbers to their service. Vanity, toll-free, and local numbers are all available through virtual phone service providers like Grasshopper, RingCentral, Jive, Nextiva, and UniTel Voice.

While there are services that offer free virtual phone numbers, they won’t offer the options of unlimited calling or the ability to connect to multiple users. When you want customer calls routed to the right place without restrictions, a subscription service is the way to go.


5 Best Virtual Phone Number Providers Compared

Several providers deliver virtual business numbers in their plans. In this next section, we’re going to take a look at five that provide toll-free, local, and vanity numbers to their customers.




grasshopper logoGrasshopper is a VoIP provider that is designed for the solopreneur up to the mid-sized business owner. It comes packed in with features like Gmail integration, business text messages, caller ID, voicemail transcription, and of course, custom phone numbers. Our comprehensive review of Grasshopper pricing and plans revealed the many reasons why this is a top choice for small businesses.


Grasshopper offers its customers:

  • Voicemail transcription
  • Virtual fax
  • Gmail integration


ringcentral logo squareRingCentral makes it easy to select a toll-free number that has 800, 888, 877, 866, 855, or 844 prefixes. RingCentral also has a complete UCaaS platform for its users so that they can experience a full suite of business communications options.

Compared to Grasshopper, RingCentral has a structure that accommodates most business sizes, and there are four business plans to select: Essentials, Standard, Premium, and Ultimate.


RingCentral offers its customers:

  • Hundreds of integrations
  • Visual voicemail and voicemail to email or SMS
  • 24/7 support for the Standard Plan and above

Jive Communications


Jive, like Grasshopper, is a LogMeIn product. When selecting a virtual business number from Jive, you’re granted a choice from within over 200 area codes. From Jive’s website, it’s easy to order new phone numbers. Jive charges by the minute for inbound calls on virtual business numbers, but flat monthly rates are also available.

Since Jive is a UCaaS powerhouse, they can offer several prefixes, including 800, 888, 877, 866, 855, or 844 numbers to customers. For those that want to transition from a PSTN system, analog telephone adapters (ATA) are also offered. These allow traditional phones to work like VoIP phones.


Jive offers its customers:

  • Individual call logs
  • Inbound call filter to block robocallers and spam
  • Lightweight Directory Access Protocol (LDAP) integration to streamline user login


nextiva logo square

Nextiva provides business phone numbers in every state. This includes toll-free numbers of all prefixes, vanity, and local options. Nextiva is a provider that delivers unified communications to business owners, and features like virtual voicemail and an auto attendant come bundled in with their plans. According to their site, Nextiva is “the largest local business virtual phone number provider in the country.”

Nextiva has three business communications plans that include Basic, Pro, and Enterprise. Each of these is built with communications with clients and between team members in mind. Nextiva also makes it relatively easy to port older numbers to their virtual phone system.


Nextiva offers its customers:

  • 24/7 Phone, email, and live chat support
  • Shared call appearance
  • Bundled virtual voicemail and auto attendant

UniTel Voice

unitel voice logo

UniTel Voice is a service provider that grants toll-free virtual numbers with the 800, 888, 877, 866, 855, and 844 prefixes. It also allows access to 833 numbers, which were added in 2017 by the FCC. UniTel differentiates when callers reach out via the virtual business number by featuring the inbound number on the device screen. From here, it’s easy to answer or to forward calls.


UniTel Voice offers its customers:

  • Unlimited extensions
  • Voicemail to email transcription
  • Voice Talent Studio for customized messages


Side-by-side Provider Comparison


Provider Available Prefixes Plans Vanity, Local, and Toll-free numbers International
Grasshopper 800, 833, 844, 855, 866, 877, 888
  • Basic -$26/m
  • Premium – $44/m
  • Platinum – $80/m
Yes No
RingCentral 800, 844, 855, 866, 877, 888
  • Essentials – $19.99/m
  • Standard – $24.99/m
  • Premium – $34.99/m
  • Ultimate – $49.99/m
Yes Yes
Jive 800, 844, 855, 866, 877, 888
  • 1-99 Users – $19.95 – $29.95
  • 100+ Users – Custom Pricing
Yes Yes
Nextiva 800, 833, 844, 855, 866, 877, 888
  • Essential – $19.95/m
  • Professional – $20.95/m
  • Enterprise – $27.95/m
Yes No
UniTel Voice 800, 833, 844, 855, 866, 877, 888
  • Start-Up – $9.99/m
  • Unlimited – $29.99/m
  • Office – $49.99/m
  • Custom – Not published
Yes No


Virtual Phone Numbers Bring You Closer to Customers


For small business needs, expansion requires that customers have an easy way to reach your brand, and this is what makes virtual phone numbers such a viable tool. These numbers make a smaller business appear more national, grant a local presence when needed, and help make foreign markets more accessible.

There’s no need to be on the fence; several providers grant access to virtual numbers at inexpensive monthly rates. For example, a vanity number from a provider like RingCentral only costs about $20 per month.

Once you’ve selected your optimal provider, setting up virtual numbers for your business is easy. These numbers are just part of the broader business VoIP world that helps your business scale and take advantage of new markets.