How Many Paying Customers Is Your IVR Costing You?


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Apple, Ally Bank, Amazon and Zappos. What do all of these companies have in common?

Besides great products, innovative marketing strategies and extensive product eco-systems, they all deliver on one more essential ingredient: Exceptional Customer Service.

Take Apple for instance. I brought my MacBook into the Genius Bar at my local Apple Store a few months ago. Two of the four little feet that keep the MacBook off the desk fell off. Despite the fact that the machine was more than 3 years old and that I did not have an Apple Care service plan, they still took the machine in the back and glued on four new ones for me. And while I had to make an appointment for this, but how about that there’s even such a thing as a Genius Bar in a retail store to accommodate me in the first place?

I’ve had many similar first rate customer experiences at Amazon, Best Buy and even some small retailers I have done business with through eBay. Responsive email and chat support, free shipping both ways, customer reviews right on the retailers own web site, extended product return and replacement policies and so on. Today’s recession weary, highly connected consumer is demanding and changing business models and the customer service landscape as we speak.

Improve the Customer Experience, Or Else!

With examples of exceptional products and service like these, today’s consumer has little tolerance for poor customer service. Not only will they defect to competing brands, but they are very quick to complain about bad experiences on social media networks. Web savvy customers with smart phones, iPads, mobile devices and a WiFi hot spot always at hand have come to demand more. They have absolutely no problem airing their grievances on sites like Facebook, Twitter and other social media outlets.

As a result, the pressure is on for companies to improve, improve big and improve fast. According to Beyond Philosophy, which recently released its 2011 Global Customer Experience Management Survey: “Despite the significant investment in customer experience management made by telecom, banking, retail and IT, customer experiences with these organizations remain largely poor.”

With IVR still the initial point of entry for most customer service phone inquiries, James Larson asks in an article titled “IVR Has a Black Eye” in the November, 2011 issue of Speech Technology Magazine:

Why do consumers still generally dislike IVR applications? Some systems might enforce Frugal Customer Service Policies to try to save money. In reality, these policies spawn unhappy customers. As a result of the policies, customers not only dislike the specific company, but also dislike phone customer support systems. In short, companies with frugal IVR policies are causing customers to dislike all IVR systems.

Matching Playback Speed to Caller Skills

One important aspect of the caller’s experience is simply the speed of the recorded IVR speech. On average, American English speakers speak at a rate of 110 to 150 words per minute. Of course, it depends on whether the speaker is from New York or California!

The question is, what is the right pace of speech for the listener to navigate an IVR? Interactive Digital conducted a test recently to see how many callers were comfortable listening to a client’s IVR at various speaking rates.

During the test, we set up the IVR to answer all calls at 95 percent of the originally recorded speaking rate. This particular client’s voice applications tended to run a little on the faster side and hence, the 95 percent initial setting. This meant that all callers to all of the client’s voice applications heard the initial or “greeting” audio message at 95 percent of the speaking rate at which the audio was originally recorded.

Interactive Digital’s Adaptive Audio software product was then used to monitor how skillful each caller was at navigating the particular voice application they were using.

If a particular caller was at an “expert” skill level, they progressed quickly to a maximum (programmed) speed of 107 percent. If they were “fast,” but not quite expert, they went more gradually to a speed of 100 percent. The same happened in the opposite direction for callers that were not so skilled, with the worst performers bottoming out at 85 percent. As Figure 1 shows below, over 80 percent of all callers qualified themselves to be at speeds other than the initial 95 percent speed.

Figure 1

Interestingly, only about 16 percent of all callers (354/2277) qualified themselves back to the original 100 percent speed of the recorded audio. Not surprisingly, caller input error rates went down and IVR utilization (IVR turns per call) increased when the speed of the audio was tuned in to the comfortable listening pace for each caller.

How Customers Judge Interactions

The Harvard Business Review published an article in 2001, “Want to Perfect Your Company’s Service? Use Behavioral Science.” The study examined how encounters between customers and service providers make customers feel about the experience. In 2010, John DeVine and Keith Gilson built on this research with, “Using behavioral science to improve the customer experience.” The authors conclude (among other things):

People judge interactions by whether they progress or deteriorate. People also have an innate preference for improvement in both long and short interactions, so it is better to end on a high note. Moreover, the final impression is truly lasting; people forget how a conversation began, but easily recall how it concluded.

As demonstrated with the empirical data we collected during these production tests, adapting audio playback speed to match the skills of individual callers as they progress through the dialogue tree of an automated phone call helps to leave the right final impression. That kind of impression in turn helps bring the caller back to the IVR the next time and, more importantly, back to the enterprise that supports it.

Contact centers now have the means to improve customer satisfaction using behavioral science. Implementing these principles has a low monetary barrier, but requires a conscious decision to move beyond many of the business models of the pre-internet era. The increase in customer satisfaction that results from implementing these principles can increase customer loyalty, brand equity and ultimately sales and revenue to the bottom line.

The cost of not implementing them can be learned in about .02 seconds flat with a Google search on any of the popular customer sentiment blogs.

Daniel O'Sullivan
CEO, innovator and technologist in software engineering and product development. Created and implemented Adaptive Technology and Fastrack Software products that have optimized over 1.5 Billion self-service phone calls worldwide and saved clients over $100M to date. Electrical Engineering undergrad with a Masters in Computer Science. Lucent/Bell Labs alumni. Winner of worldwide eco-design project and received several patents. Currently CEO of Software Technology Partners.Focus: Business Development, Technology Partnering, Mobile, Web and Cloud Technologies and Human-Computer Interaction.


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