A BRIEF HISTORY OF CUSTOMER SERVICE
“PLEASE CONTINUE TO HOLD, YOUR CALL IS IMPORTANT TO US.....”
Originally, call centers were agent-based. Customers would call a toll-free number and wait – and sometimes wait even more – while listening to monotonous, on-hold Mozart and repeated assurances that "your call is important to us."
Finally, the customer reaches an agent – only to make a simple inquiry.
These agent centric call centers required both major capital investments and significant labor expenses. As these costs continued to grow, many businesses explored and invested in new technologies for 24x7 self-service options.
"FOR CUSTOMER SERVICE, PRESS 4…”
Complementing agent-based call centers, early efforts in automation and self-service focused on Interactive Voice Response (IVR) – using nested menus of touch-tone codes to let customers interact directly with enterprise computer systems. With a majority of call center calls routine and repetitive in nature, companies realized that it would be effective to automate those interactions by taking advantage of the "new" touch-tone keypad and advances in computer telephony integration (CTI). Right? Only partially so. Unfortunately, except for basic applications, touch-tone systems have had a low degree of customer acceptance – typically processing less than 20% of inbound calls. Too often, callers quickly learned to "zero-out" and hold for an agent. The result: staffing and training costs remain high while agents continue to field routine requests. Telecom costs are also higher than necessary, as companies "foot the bill" for callers who prefer to wait on hold, rather than navigate through a cumbersome maze of single-step requests. And more importantly, many callers remain frustrated with the call center experience.
WWW.COM ERA
In recent years, the World Wide Web has opened up opportunities for automated self-service and "e-business" and many consumers are willingly going online to trade stocks, book flights, check weather and more. The Web lets companies deliver information and transaction services to customers like never before, and is forever changing people’s perceptions about "self-service" anytime, anywhere. However, with the explosion in wireless, the telephone still is the most ubiquitous device. That’s why innovative customer service leaders are looking to complement their Web initiatives (the data, the applications, the interfaces, the branding) with telephone services that callers can conveniently use – time and time again.
ENTER SPEECH
Sensitive to the needs of customers and their growing self-service expectations — and seeking to streamline call centers to reduce costs — companies have turned to speech recognition to power their telephone based services. The first, large-scale, natural language speech systems were deployed in 1997. Since then, companies such as E*TRADE, United Airlines, FedEx and BellSouth have been delighting their customers with speech. What are the benefits these companies – and others like them – have achieved? Here’s an overview.
LOWER COSTS
While touch-tone typically handles 20% or fewer of all calls, speech — with its natural and engaging interface — typically handles more. In fact, one online brokerage firm increased automation from 10-20% with touch-tone to over 70% with speech.
This increase in automation significantly reduces staffing and training costs. In addition, by intercepting routine calls to live agents, speech lets agents tackle complex calls or higher-value sales transactions that require their skilled intervention.
It also means lower "on hold" expenses from the callers waiting for agents. What’s more, in many instances, speech-handled calls can be significantly faster than agent-handled calls, which also reduce telecom network charges.
INCREASED REVENUE
The power and flexibility of speech opens up numerous avenues for generating incremental revenue. You can begin to process "e-commerce" and "m-commerce" orders from customers who may not have computer access or are away from their PCs. That’s because speech can extend your website to create a speech-enabled e-commerce system. Now, cell phone callers can bypass touch-tone codes or tiny WAP screens and cursors to place stock trades or reserve a hotel room just by speaking naturally.
INCREASED CUSTOMER SATISFACTION
No interface is more natural than speech. Users agree: it’s far more pleasant to say "I’d like to buy 100 shares of Acme Corporation at the market price tomorrow" than to punch in the trading symbol, number of shares and trading day.
With speech, customers get the right answers quickly any time of day – and that increases satisfaction and loyalty. The power of speech means that customers "hang up with a smile."
COMPETITIVE DIFFERENTIATION
With speech, a company can distinguish itself from the competition and, more importantly, keep its customers coming back again and again. That’s because in many industries, touch-tone systems are still the norm. Being an early adopter of speech, a company can demonstrate leadership in its commitment to customer satisfaction and innovation.
SPEECH LOWERS COST
REDUCING AGENT-RELATED EXPENSES
Let’s take a closer look at how speech recognition can help reduce costs. The average agent-handled call costs anywhere from $1.50 to $15.00, while speech-handled calls can cost as little as $0.10 to $0.35 per call. Because speech systems are easy (and fun) to use, customers do "self-serve" their routine requests and transactions. The result:
• lower abandonment rates
• increased use of automation
• shorter hold times
• lower agent-related expenses
• bottom-line savings
Speech reduces the expenses of staffing and training a professional call center.
Agent costs – salary, benefits, equipment and overhead – represent more than 56% of the typical call center’s budget. What’s more, turnover among "burned out" call center agents averages more than 25% annually in most industries.
By contrast, speech offloads routine calls from the agent’s queue. Or, if the speech system can’t completely solve the caller’s issue, it can classify the call or collect necessary information before passing the call to the agent. That means agents focus on complex queries, increasing their job satisfaction. That, in turn, reduces attrition levels and their associated hiring and training costs. With fewer calls reaching agents, call centers can accommodate future growth in call volumes with existing staff levels.
CASE IN POINT
One leading financial services firm ran up against the limits of touch-tone systems for providing account holders access to their 401(k) accounts. Caller satisfaction was low and call-abandonment was high. After deploying speech, the company was able to process numerous transactions – without agent intervention. Abandonment rates dropped 66%. And costs per call were reduced from $4 per agent-assisted call to less than $0.40 per call with speech — a 90% savings.
REDUCE NETWORK CHARGES
By cutting – or eliminating – hold time, menu navigation time, and the time spent prompting the caller through different menus; speech can dramatically reduce call length and associated telecom charges. A recent Frost & Sullivan study notes that toll-call charges dropped on average 15% to 50% with speech recognition. What’s more, when callers opt for speech, the hold times for callers waiting for agents decreases as well, further reducing toll charges.
CASE IN POINT
By providing automated access to funds and accounts – without forcing callers to wade through lengthy touch-tone menus or wait on-hold for an agent – a leading financial services firm reduced its average call time from 12 minutes to two. Another company, an airline, used speech to reduce hold times from 20 minutes to immediate service for customers calling in.
SPEECH GENERATES REVENUE
Beyond cost reductions, speech also offers excellent opportunities for making money for your organization. Consider the market penetration of the telephone. Today, the phone is the most widely adopted communications device anywhere in the world. Cell phone subscriptions are increasing faster than Internet connection rates, and exceeded more than 1 billion by 2003, according to IDC.
Given the ubiquity of telephone access and the market’s clear preference to communicate by phone, speech is the natural interface for a variety of telephone- initiated transactions: stock trading, e-commerce, travel reservations, order placements and tracking, and much more.
Speech enables new marketing and sales avenues for cross-selling, up-selling and affiliate selling. For example, a speech service can include builtin context-sensitive advertisements to inform customers about a related offering and let them make purchases automatically. "Would you like to learn about our First Class upgrades?" the automated speech system inquires after a caller receives flight and fare information.
Speech recognition also allows enterprise customers to add informational services that complement the primary application, and obtain revenue dollars for doing so. For example, a stock trading application might include a news update; a travel application, a weather report. Advances in low-cost text-to- speech solutions are making it increasingly cost-effective to deliver services with content that is personalized (like email or driving directions) and constantly changing.
CASE IN POINT
Aiming to reduce call center costs, one of the world’s leading office-supply retailers launched a speech-activated system and experienced an additional benefit: more revenue. Not only do the automated calls cost the company 88% less than agent-handled calls, the speech orders also average a greater number of items and a higher total value than sales calls handled by live agents.
SPEECH INCREASES CUSTOMER SATISFACTION AND LOYALTY
Customer expectations for service continue to rise. The self-service model of the Web has fueled this dynamic as more customers seek "after-hours" access to information and services. Perhaps the best measure of customer dissatisfaction can be found in the fact that as many as 30% of callers immediately disconnect when they encounter a touch-tone system. Quite simply, touch-tone doesn’t meet their expectations for customer service.
By contrast, callers continually express a preference for speech-recognition systems as demonstrated by fewer "zero-outs" or disconnects. In fact, a recent Frost & Sullivan study noted that 50-60% of callers who skip complex touch-tone systems are comfortable using speech recognition for the same application.
Additionally, new research indicates that many callers are choosing to interact with speech, instead of a live agent. They’re buying more products and getting more information – in less time and at less cost.
CASE IN POINT
Millions of people are enjoying instant information from the Internet and now want it “on the go.” A leading portal company has responded by providing speech-enabled phone access to its members, enabling them to retrieve e-mail, review headline news, get national or international weather, even shop – all by simply speaking naturally into any phone. Customers are delighted: the service successfully handled more than 100,000 calls within the first four days of launch, and now serves more than one million calls a month.
SPEECH CREATES COMPETITIVE ADVANTAGE
Whether it interfaces to standard enterprise systems or to a company’s e-commerce/Web infrastructure, speech can provide substantial differentiation for your company in the eyes (and ears!) of customers. Your speech service is the voice of your company and it carries a strong brand identity. By being the first to market with speech in a particular industry or market segment, a company can create a "wow" factor that captures customers and provides a durable barrier to erosion and churn. In 1997, one brokerage chose to do just that. After deploying the first speech service of its kind, this leading online brokerage saw an increase in the number of customers and the volume of orders. The company enjoys heightened customer satisfaction and the image of technological leader-ship in the brokerage industry. Speech provides another unique advantage: personality! When you select a certain voice talent and style of dialogue with users, your company can project an image that is right for you. Fun-loving, trustworthy, helpful – these are all qualities your speech service can deliver consistently to your callers.
Caller experience and economic results go hand in hand. When you work with a speech vendor who can help you provide an effective caller experience, you will not only reap benefits of competitive advantage and caller satisfaction, but – because callers will readily use your automated system — the economic results will follow, as well.
NEXT STEPS
Now that you understand the far-reaching return of speech and its impact on your business case, let’s briefly look at some investment considerations.
• Many speech applications leverage existing investments in corporate websites/e-commerce system and call center technologies.
• There are many different speech investment strategies to explore. Evaluate "in-house" systems, outsourcing, hosted models or transactions-based fee structures.
• Identify multiple potential application areas within your company in order to amortize costs over time or distribute costs over various departments
“PLEASE CONTINUE TO HOLD, YOUR CALL IS IMPORTANT TO US.....”
Originally, call centers were agent-based. Customers would call a toll-free number and wait – and sometimes wait even more – while listening to monotonous, on-hold Mozart and repeated assurances that "your call is important to us."
Finally, the customer reaches an agent – only to make a simple inquiry.
These agent centric call centers required both major capital investments and significant labor expenses. As these costs continued to grow, many businesses explored and invested in new technologies for 24x7 self-service options.
"FOR CUSTOMER SERVICE, PRESS 4…”
Complementing agent-based call centers, early efforts in automation and self-service focused on Interactive Voice Response (IVR) – using nested menus of touch-tone codes to let customers interact directly with enterprise computer systems. With a majority of call center calls routine and repetitive in nature, companies realized that it would be effective to automate those interactions by taking advantage of the "new" touch-tone keypad and advances in computer telephony integration (CTI). Right? Only partially so. Unfortunately, except for basic applications, touch-tone systems have had a low degree of customer acceptance – typically processing less than 20% of inbound calls. Too often, callers quickly learned to "zero-out" and hold for an agent. The result: staffing and training costs remain high while agents continue to field routine requests. Telecom costs are also higher than necessary, as companies "foot the bill" for callers who prefer to wait on hold, rather than navigate through a cumbersome maze of single-step requests. And more importantly, many callers remain frustrated with the call center experience.
WWW.COM ERA
In recent years, the World Wide Web has opened up opportunities for automated self-service and "e-business" and many consumers are willingly going online to trade stocks, book flights, check weather and more. The Web lets companies deliver information and transaction services to customers like never before, and is forever changing people’s perceptions about "self-service" anytime, anywhere. However, with the explosion in wireless, the telephone still is the most ubiquitous device. That’s why innovative customer service leaders are looking to complement their Web initiatives (the data, the applications, the interfaces, the branding) with telephone services that callers can conveniently use – time and time again.
ENTER SPEECH
Sensitive to the needs of customers and their growing self-service expectations — and seeking to streamline call centers to reduce costs — companies have turned to speech recognition to power their telephone based services. The first, large-scale, natural language speech systems were deployed in 1997. Since then, companies such as E*TRADE, United Airlines, FedEx and BellSouth have been delighting their customers with speech. What are the benefits these companies – and others like them – have achieved? Here’s an overview.
LOWER COSTS
While touch-tone typically handles 20% or fewer of all calls, speech — with its natural and engaging interface — typically handles more. In fact, one online brokerage firm increased automation from 10-20% with touch-tone to over 70% with speech.
This increase in automation significantly reduces staffing and training costs. In addition, by intercepting routine calls to live agents, speech lets agents tackle complex calls or higher-value sales transactions that require their skilled intervention.
It also means lower "on hold" expenses from the callers waiting for agents. What’s more, in many instances, speech-handled calls can be significantly faster than agent-handled calls, which also reduce telecom network charges.
INCREASED REVENUE
The power and flexibility of speech opens up numerous avenues for generating incremental revenue. You can begin to process "e-commerce" and "m-commerce" orders from customers who may not have computer access or are away from their PCs. That’s because speech can extend your website to create a speech-enabled e-commerce system. Now, cell phone callers can bypass touch-tone codes or tiny WAP screens and cursors to place stock trades or reserve a hotel room just by speaking naturally.
INCREASED CUSTOMER SATISFACTION
No interface is more natural than speech. Users agree: it’s far more pleasant to say "I’d like to buy 100 shares of Acme Corporation at the market price tomorrow" than to punch in the trading symbol, number of shares and trading day.
With speech, customers get the right answers quickly any time of day – and that increases satisfaction and loyalty. The power of speech means that customers "hang up with a smile."
COMPETITIVE DIFFERENTIATION
With speech, a company can distinguish itself from the competition and, more importantly, keep its customers coming back again and again. That’s because in many industries, touch-tone systems are still the norm. Being an early adopter of speech, a company can demonstrate leadership in its commitment to customer satisfaction and innovation.
SPEECH LOWERS COST
REDUCING AGENT-RELATED EXPENSES
Let’s take a closer look at how speech recognition can help reduce costs. The average agent-handled call costs anywhere from $1.50 to $15.00, while speech-handled calls can cost as little as $0.10 to $0.35 per call. Because speech systems are easy (and fun) to use, customers do "self-serve" their routine requests and transactions. The result:
• lower abandonment rates
• increased use of automation
• shorter hold times
• lower agent-related expenses
• bottom-line savings
Speech reduces the expenses of staffing and training a professional call center.
Agent costs – salary, benefits, equipment and overhead – represent more than 56% of the typical call center’s budget. What’s more, turnover among "burned out" call center agents averages more than 25% annually in most industries.
By contrast, speech offloads routine calls from the agent’s queue. Or, if the speech system can’t completely solve the caller’s issue, it can classify the call or collect necessary information before passing the call to the agent. That means agents focus on complex queries, increasing their job satisfaction. That, in turn, reduces attrition levels and their associated hiring and training costs. With fewer calls reaching agents, call centers can accommodate future growth in call volumes with existing staff levels.
CASE IN POINT
One leading financial services firm ran up against the limits of touch-tone systems for providing account holders access to their 401(k) accounts. Caller satisfaction was low and call-abandonment was high. After deploying speech, the company was able to process numerous transactions – without agent intervention. Abandonment rates dropped 66%. And costs per call were reduced from $4 per agent-assisted call to less than $0.40 per call with speech — a 90% savings.
REDUCE NETWORK CHARGES
By cutting – or eliminating – hold time, menu navigation time, and the time spent prompting the caller through different menus; speech can dramatically reduce call length and associated telecom charges. A recent Frost & Sullivan study notes that toll-call charges dropped on average 15% to 50% with speech recognition. What’s more, when callers opt for speech, the hold times for callers waiting for agents decreases as well, further reducing toll charges.
CASE IN POINT
By providing automated access to funds and accounts – without forcing callers to wade through lengthy touch-tone menus or wait on-hold for an agent – a leading financial services firm reduced its average call time from 12 minutes to two. Another company, an airline, used speech to reduce hold times from 20 minutes to immediate service for customers calling in.
SPEECH GENERATES REVENUE
Beyond cost reductions, speech also offers excellent opportunities for making money for your organization. Consider the market penetration of the telephone. Today, the phone is the most widely adopted communications device anywhere in the world. Cell phone subscriptions are increasing faster than Internet connection rates, and exceeded more than 1 billion by 2003, according to IDC.
Given the ubiquity of telephone access and the market’s clear preference to communicate by phone, speech is the natural interface for a variety of telephone- initiated transactions: stock trading, e-commerce, travel reservations, order placements and tracking, and much more.
Speech enables new marketing and sales avenues for cross-selling, up-selling and affiliate selling. For example, a speech service can include builtin context-sensitive advertisements to inform customers about a related offering and let them make purchases automatically. "Would you like to learn about our First Class upgrades?" the automated speech system inquires after a caller receives flight and fare information.
Speech recognition also allows enterprise customers to add informational services that complement the primary application, and obtain revenue dollars for doing so. For example, a stock trading application might include a news update; a travel application, a weather report. Advances in low-cost text-to- speech solutions are making it increasingly cost-effective to deliver services with content that is personalized (like email or driving directions) and constantly changing.
CASE IN POINT
Aiming to reduce call center costs, one of the world’s leading office-supply retailers launched a speech-activated system and experienced an additional benefit: more revenue. Not only do the automated calls cost the company 88% less than agent-handled calls, the speech orders also average a greater number of items and a higher total value than sales calls handled by live agents.
SPEECH INCREASES CUSTOMER SATISFACTION AND LOYALTY
Customer expectations for service continue to rise. The self-service model of the Web has fueled this dynamic as more customers seek "after-hours" access to information and services. Perhaps the best measure of customer dissatisfaction can be found in the fact that as many as 30% of callers immediately disconnect when they encounter a touch-tone system. Quite simply, touch-tone doesn’t meet their expectations for customer service.
By contrast, callers continually express a preference for speech-recognition systems as demonstrated by fewer "zero-outs" or disconnects. In fact, a recent Frost & Sullivan study noted that 50-60% of callers who skip complex touch-tone systems are comfortable using speech recognition for the same application.
Additionally, new research indicates that many callers are choosing to interact with speech, instead of a live agent. They’re buying more products and getting more information – in less time and at less cost.
CASE IN POINT
Millions of people are enjoying instant information from the Internet and now want it “on the go.” A leading portal company has responded by providing speech-enabled phone access to its members, enabling them to retrieve e-mail, review headline news, get national or international weather, even shop – all by simply speaking naturally into any phone. Customers are delighted: the service successfully handled more than 100,000 calls within the first four days of launch, and now serves more than one million calls a month.
SPEECH CREATES COMPETITIVE ADVANTAGE
Whether it interfaces to standard enterprise systems or to a company’s e-commerce/Web infrastructure, speech can provide substantial differentiation for your company in the eyes (and ears!) of customers. Your speech service is the voice of your company and it carries a strong brand identity. By being the first to market with speech in a particular industry or market segment, a company can create a "wow" factor that captures customers and provides a durable barrier to erosion and churn. In 1997, one brokerage chose to do just that. After deploying the first speech service of its kind, this leading online brokerage saw an increase in the number of customers and the volume of orders. The company enjoys heightened customer satisfaction and the image of technological leader-ship in the brokerage industry. Speech provides another unique advantage: personality! When you select a certain voice talent and style of dialogue with users, your company can project an image that is right for you. Fun-loving, trustworthy, helpful – these are all qualities your speech service can deliver consistently to your callers.
Caller experience and economic results go hand in hand. When you work with a speech vendor who can help you provide an effective caller experience, you will not only reap benefits of competitive advantage and caller satisfaction, but – because callers will readily use your automated system — the economic results will follow, as well.
NEXT STEPS
Now that you understand the far-reaching return of speech and its impact on your business case, let’s briefly look at some investment considerations.
• Many speech applications leverage existing investments in corporate websites/e-commerce system and call center technologies.
• There are many different speech investment strategies to explore. Evaluate "in-house" systems, outsourcing, hosted models or transactions-based fee structures.
• Identify multiple potential application areas within your company in order to amortize costs over time or distribute costs over various departments
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