What Is IVR and How It Works

What Is IVR and How It Works

What Is IVR (Interactive Voice Response)? 

For enterprises and startups, investing in an IVR (Interactive Voice Response) system is a surefire way to reduce operational costs and improve customer experience. 

No one likes to complain about services or products, but when customers have to, this Microsoft report shows that 34% of people would rather call the company to get their issue resolved.

What Is IVR (Interactive Voice Response)

Addressing queries and complaints from customers is an unavoidable aspect of running a business. As important as it is, customer support can become quite challenging as call flow increases, even for highly staffed call centers. You should invest in automated processes that improve customer experience and operational efficiency as your business grows. 

Want to know how?

In this article, you’ll discover what an IVR is, how IVR systems work, and why contact centers should have this system set up.  

What is IVR? 

IVR is an automated telephony system that lets callers navigate a phone menu in an attempt to self-serve before reaching a call center agent. By selecting options in a menu, users can address simple concerns & access relevant information on their own. Interactive Voice Response (IVR) connects callers with suitable call agents to handle more complicated queries and complaints.  

The Interactive Voice Response system is so-called because users interact with a phone menu by following automated voice prompts. IVR systems typically use DTMF tones, also known as touch tones, as their signaling protocol. DTMF tones are beeps emitted by your mobile phone as you select menu options on your keypad. 

However, some advanced IVR systems also use voice recognition and artificial intelligence to make the customer support experience more natural and personalized. 

Chances are, you have come across IVR systems as you interact with businesses every day. Remember having to “Press 1 for Sales Support” when you called the customer care line of your favorite business?

Computers, and not actual people, were responsible for those voice prompts. 

When appropriately designed, IVR systems can reduce call volume on call center agents. However, inadequate IVR systems, characterized by complex DTMF menus and hidden options to speak to agents, will only aggravate customer dissatisfaction. 

Functionalities of Interactive Voice Response (IVR)

A common mistake many organizations make is that they do not maximize the potential of their IVR system. As technology advances, your IVR system has the potential to do much more for your business than simply prompting phone menus. 

Functionalities of Interactive Voice Response (IVR)

A sound IVR system delivers maximum value by possessing the following functionalities:

  1. Supports Personalized Greetings and Prompts

IVRs allow you to create custom greetings and voice prompts tailored to your customer’s needs. Adding little touches like greetings with your business name, or addressing customers by their names, will give callers a more intimate and enjoyable experience.

  1. Collects Caller Information

A major pain point for callers is being connected to poorly-equipped call agents or having to repeat their information severally.  A well-designed IVR will collect customer information and supply them to call center agents. IVRs use this information to transfer customers to agents who are most suited to address their concerns.

  1. Enables Self-Support

Good IVRs help customers address their complaints without the hassle of speaking to an agent. When poorly set up and not customer-centered, IVR systems will leave no dent on heavy call volumes. Worse yet, it will heighten customer frustration. Imagine tolerating a meandering phone menu, only to end up speaking to an agent to solve a minor complaint. IVR menus should be relevant to the callers they serve. 

  1. Speech Recognition

Most callers find voice recognition features in IVR systems to be customer-friendly. Tapping on a keypad can get pretty monotonous, so it’s a wise idea to design an IVR that supports speech recognition. With speech recognition, you can have a phone tree with options such as, “For balance inquiries, press ‘2’ or say, ‘balance’”.

  1. AI Integration

For a more personalized, menu-free experience, some IVR systems integrate artificial intelligence. With AI, IVRs interact with callers using questions such as “Welcome to XYZ bank, how may we help you today?”. Such unrestricted prompts convince customers that the system can resolve their specific problems. With AIs, the IVR connects customers to relevant call agents or supplies them with a helpful piece of information. 

Benefits of Using Interactive Voice Response (IVR) Systems

Here are a couple of benefits of IVR systems:

  • Increases Business Credibility

IVR systems serve as virtual receptionists for your organization. Many people are familiar with IVR menus. When presented with one, they will perceive your business as credible and larger than it might be. Also, when you invest in a relevant and personalized IVR system, callers enjoy better support experiences. 

Better customer experiences = Happy customers = Positive company ratings!

  • Round-the-clock Customer Service

24 hours a day, 7 days a week, and 52 weeks a year, this will be your company’s availability. With IVR systems, even when your agents are inaccessible, customers can access basic information and get answers to simple inquiries. IVRs will keep you connected to your customers all year long. 

Also, using personalized holiday and seasonal greetings are little touches that go a long way.

  • Affordable Setup

No organization is left out when it comes to IVRs. From startups to enterprises and non-profits, there is an IVR system to suit every budget. 

Reasons Why Your Call Center Needs an IVR System 

Interactive Voice Response systems are increasingly becoming indispensable software tools of call centers. We cannot deny that, when applied right, IVRs can save companies millions in operation costs.

Benefits of Using Interactive Voice Response (IVR) Systems

Below are 3 benefits of using an IVR in your call center:

  1. Increases Customer Support Efficiency

IVR systems redirect customers to support agents who specialize in tackling their specific issues. This way, agents can thrive by addressing challenges they understand best, and they will handle complaints faster. The shorter the time an agent spends resolving an issue, the higher the organization’s efficiency.

  1. Manages Heavy Call Load

Self-service options on IVR menus ensure that agents can focus on addressing more pressing customer complaints. Callers who want to make simple inquiries or lodge minor complaints can always use the options provided by the IVR menu.  Self-support is a priceless feature for companies with a huge customer base. This feature also helps small businesses manage those work hours that typically have higher call volumes. 

  1. Increases Customer Satisfaction

Many customers report that the most frustrating aspect of poor customer service is speaking to a clueless call agent. IVR systems leave no room for errors, as they collect relevant customer information through prompts. The inputted information helps the system determine the call agent that is skilled in handling similar complaints. 

Regardless of your business type, the services you render, or the products you sell, using an IVR system is always a good idea. It saves you time, operation costs and ensures positive customer experiences when appropriately implemented. 

Invest in an IVR system today and watch it take your CX game to the next level!

Other Resources:

CustomersFirst Academy offers comprehensive customer service training designed to help you grow your skills and advance your career.

To keep learning and developing your knowledge of customer service, we highly recommend the additional resources below:

Everything You Need to Know About Working in a Call Center
Working in a Call Center: What You Need to Know

10 Commonly Asked Call Center Interview Questions and Answers
Complete Guide to Becoming a Switchboard Operator

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