Self-service is one of the best ways to cut call center costs and speed up over-the-phone interactions with customers. And an IVR is one of the most well-known self-service tools out there. But there are costs involved in buying a new solution or upgrading an old one. So if you want the best deal, it’s natural to wonder whether that IVR cost is really worth the price.
Of course there are other self-service channels to consider. But a phone-based IVR is still the go-to solution for businesses around the world and an expectation for most customers. But how long will that be the case? And is an IVR investment really a good idea for the near future? Before that, let’s make sure we’re on the same page when we talk about “IVR.”
What is IVR?
IVR stands for interactive voice response system. An automated IVR solution communicates with people through keywords (directed dialogue), keypad entries (dual-tone multi-frequency) or by using everyday speech (natural language). Businesses set up an IVR to accomplish two main goals:
- Solve customer problems with self-service without transferring to an agent
- Route callers to the best available representative using automatic call distribution
Those two goals are the primary focus of every IVR, no matter what new features developers come up with. And providers have found radical new features to shake up the IVR landscape. Some of these developments include:
- Agent Integration: Creates a seamless IVR-to-agent experience by showing all the information provided by a caller so far on the agent’s computer screen
- Multilingual Support: Makes it possible for the IVR to recognize multiple languages or let the caller choose what language they’d like to communicate with
- Satisfaction Surveys: Let callers provide feedback on their experience with the IVR and the agent in a secure, anonymous format
- Text-to-Speech (TTS): Allows the system to locate and vocalize relevant text from databases during a phone call, instead of relying solely on pre-recorded prompts
- Visual IVR: Uses visual aids and prompts — like calendars and web forms — to make the conversation easier to understand and greatly expand functionality
Applying any of these innovations is important to consider when calculating IVR cost and eventual ROI. But there are a few factors that affect IVR cost, no matter how simple or advanced the solution is.
Factors Used in Calculating IVR Cost
On-premise vs. Hosted
When installing an IVR solution, you have two options: on-premise or hosted. Like any piece of software, an IVR runs on servers and databases, and those servers have to be kept in a physical location somewhere. With an on-premise system, that “somewhere” is with the business that purchased the solution. They often own the hardware, which makes them responsible for update, repair and replacement costs.
A hosted IVR system is a cloud-based solution that is stored off-site, typically with an IVR provider like West. These servers are usually much larger because they operate IVRs for multiple organizations, unlike on-premise solutions that operate only one. The IVR provider pays the upgrade, repair and replacement costs, which can make cloud-based solutions cheaper and less stressful to maintain.
As you might expect, the price varies based on which IVR provider you choose. But the method of pricing also changes. Some providers charge per minute. So the more customers who call and the longer they spend in the IVR, the more a business is charged. Some providers charge less than one cent per minute, while others may charge more than 10 cents. Keep in mind that if your IVR handles a large amount of in-call minutes, your provider may give you a lower rate.
Other technology providers offer their IVR services for a flat rate. These solutions fall in a vast array of prices, from about $50 to hundreds of dollars. Plus, IVR providers may charge extra for added lines, so for medium-to-large businesses, “hundreds” could become “thousands.” The best way to compare prices is by requesting quotes from different providers.
SaaS or Managed
Lastly, consider the IVR provider’s operating philosophy. Do they optimize the IVR to meet your needs? Or do they just set it up and expect you to do the rest? That’s the difference between a managed or software-as-a-service (SaaS) provider. A managed service provider uses their expertise to make your solution better. A SaaS provider just turns the solution on and provides technical support. Naturally, managed providers are more expensive, but they have a huge impact on the next piece of the IVR cost equation: ROI.
IVR ROI: Is it Worth It?
While many factors affect how much you spend on an IVR, perhaps the most important thing to consider when calculating IVR cost is how much money it saves. As long as IVR return is greater than IVR expense, the true IVR cost is worth the investment.
You may need to request quotes from different providers to find price points, but you can start discovering the value of a new or upgraded IVR today using our IVR Calculator. Just click here to get started.
Estimate your own return and test out different scenarios with the above calculator, and you’ll see that a good IVR solution is a great investment. If agents answer 10,000 calls per month and the IVR can contain 50 percent of calls, a business could save more than $10,000 in the first month. Having agents answer those calls is more than double the price.
Remember, containment (the percentage of calls resolved without an agent’s help) varies by industry and from business to business. An average is difficult to identify, but West once helped an ecommerce company contain more than 80 percent of its calls in the IVR. So test out a few different possibilities in the calculator, and check out case studies relevant to your business before picking a provider.
Turning an IVR into a Customer Experience Champion
Many customers still dread talking to an IVR. But with help from the right provider, you can show customers its true value as a self-service champ. So don’t just pick the cheapest IVR you find. Make sure it meets all your needs and provides the most value to your business and to every caller.
For a more accurate look at IVR cost, call or text a West expert at 800.841.9000. And check out this next post to see 21 ways to get customers to love self-service to make the most from your IVR solution.