Caller ID is the telephone feature that transmits and displays the calling party’s phone number and sometimes name to the recipient before they answer. It enables call screening and provides context about incoming calls.
How does caller ID work?
When a call is placed, the originating carrier sends caller identification data through the network. The receiving carrier displays this information on the recipient’s phone. For outbound calls, businesses can configure what number and name appear, subject to carrier policies and regulations.
Why does caller ID matter?
For inbound calls, caller ID enables personalization by identifying known customers before the conversation starts. For outbound calls, the displayed information significantly impacts answer rates. Unfamiliar or suspicious caller IDs often go unanswered, while recognized business names encourage pickup.
Caller ID in practice
An AI voice agent receiving an inbound call uses caller ID to look up the customer record before answering. When the call connects, the agent greets the caller by name: “Hi Sarah, thanks for calling. I see you have an appointment scheduled for tomorrow. Are you calling about that?”