Interactive voice response (IVR) is an automated phone system that enables callers to interact with a computer program, rather than a human voice agent. Virtually all IVR systems are able to route calls to the appropriate department or personnel (or a voicemail box) at the end of the process.
Traditional IVR systems prompt callers to supply simple information by selecting from a list of pre-set options and offer canned responses to the prompts the caller selects. These limited capabilities often lead to customer frustration, which is why conversational AI-powered IVR, offered on an omnichannel platform, is a game changer for customer experience (CX).
Read on to find out what an advanced IVR system is, how it works, and the benefits it delivers for your business.
IVR: Your Most Valuable Channel
When it comes to customer service and engagement, the voice channel reigns supreme.
Although organizations have focused much of their efforts and budgets on digital transformation in recent years, telephone calls still accounted for nearly three-quarters of inbound contact center interactions as recently as 2019. This includes self-service and agent-assisted calls, both of which are usually routed by an IVR .
How Does IVR Work?
IVR technology at its most basic level works by using dual-tone multifrequency signaling (DTMF) or voice recognition technology—sometimes both.
With DTMF, customers use their keypad to pick a menu option, no human operator necessary.
Voice recognition technology allows for directed dialogue, meaning a caller can give verbal answers instead of using a keypad. Callers are typically asked a question and given a limited number of possible responses. If they stray off script—that is, respond in ways that aren’t in the computer’s preprogrammed arsenal—they will be reach a dead end.
Video: Learn More About IVR
5 Reasons to Ditch Your Dumb IVR
As Intuit cofounder Scott Cook once advised, “Instead of focusing on the competition, focus on the customer.” For most organizations with large customer service operations, this advice may not be revolutionary. However, it may surprise some to learn just how much customer experience can affect their bottom line. One in three customers say they would stop doing business with a brand they loved after just one bad experience—and 42% would pay more for a friendly, welcoming experience.1
One of the biggest culprits of poor service is an
outdated IVR channel
. By and large, consumers don’t like interacting with traditional IVRs. Just look at these stats on the subject:2
61% of consumers feel that IVR technology makes for a poor customer experience
Only 13% percent believe it (IVR) makes for a positive one (customer experience)
The cost effectiveness of an IVR compared to live agents is undeniable. However, companies can no longer afford to let poor customer experience (CX) from using IVR drive customers away. The question now becomes how to use an IVR to control support costs, while also providing an excellent customer experience.
Here are five important ways in which your current IVR is likely to disappoint your customers, along with strategies to transform your IVR into a customer service asset rather than a liability.
1. Traditional IVR doesn’t talk to other channels.
The issue: According to one survey, 52 % of Americans are frustrated at having to repeat themselves.3 This invariably drives customers away from your company or forces them to escalate to a more expensive channel where they’ll have to start over with a live agent. And that’s where the big problems begin.
You should make the context and details of your customers’ activity in the IVR channel available to other channels so you can provide a seamless, connected experience. By doing so, you’ll stop annoying virtually every customer who leaves the IVR in search of assisted service.
2. Traditional IVR isn’t visual or mobile friendly.
The issue: 50% of customers are on your website when they call your IVR.4 This is a strong indication that your customers want to self-serve, but also appreciate having a visual component to their customer service interaction. If what you provide instead is an outdated, confusing, audio only IVR, you’re introducing a level of customer frustration that’s hard to overcome.
The solution: Instead, look for a solution that pairs the visual experience with the voice experience, pushing rich, interactive content to an IVR caller’s smartphone or computer.
By doing so, you’ll be delivering a support experience that’s right in line with customer expectations. There are 3.5 billion smartphone users worldwide, so it’s no surprise that 69% of decision makers are citing self-service as a major part of their service strategy.5
A great way to make your IVR more mobile friendly is to offer callers the option to complete their journey online, by simply offering to send an SMS message that includes a link to a dynamic, interactive mobile web experience where they can complete their journey using the touch capabilities of their connected smartphone.
Here’s an example of how a visual and mobile-friendly IVR can look:
3. Traditional IVR is not web aware.
: Recent research shows that 87% of customers start their journey in digital channels.6
: To keep pace with today’s digital-first consumer, you need an IVR system that honors the fact that, by the time customers interact with your IVR, they are often far along in their customer service journeys.
Your IVR should be web-aware, meaning it should use the context from a customer’s web journey and detect if the customer is still on your website during the call. This enables greater personalization for callers in real time and makes channel-switching a nonissue along the journey, rather than a standout impediment.
4. Traditional IVR doesn’t understand what customers are saying.
: Legacy IVR platforms leverage earlier-era voice recognition technology that only works well when customers say certain words in response to certain prompts. This causes customers to speak in very unnatural ways that slow the process down and creates frustration, and errors.
: Today’s leading IVR platforms employ natural language technology processing (NLP) which interprets the natural everyday speaking language that customers use, and accurately derives the correct meaning from what customers are saying. This eliminates the frustration, making the call much easier for the customers and, ultimately, keeps more customers engaged with the IVR throughout the journey because abandonment due to speech recognition issues are a thing of the past.
5. Traditional IVR is just plain difficult to use.
: With all these drawbacks, it should come as no surprise that in one study, 64 % of respondents described having negative feelings such as frustration when faced with an IVR.2
This customer frustration can arise at many points throughout the IVR interaction, such as during an overly complicated user authentication or while navigating confusing menu options. This can result in a “once bitten twice shy” syndrome, leaving your customers cringing at the idea of having to use your IVR again in the future, and a general lack of confidence in your IVR’s problem- solving abilities.7
: By implementing natural language processing, making your
and providing digital engagement options as described above, you can avoid leaving your customers “snake bit” and provide them with a far more satisfactory IVR experience.
With statistics like these, finding an IVR that customers would describe as easy to use might sound like an impossible task. But new developments in technology have made intelligent, connected IVR systems not only possible, but easy to deploy. Look for systems that integrate visual and voice, allowing customers to easily authenticate their identities, visually bypassing the parts of the IVR that aren’t relevant to them and that can intelligently predict next steps—all things that instill confidence in your IVR channel.
It’s Time to Ditch Your Dumb IVR
IVR systems are a necessary cost-control measure for most large organizations that enable the handling of hundreds of thousands of customer service issues at scale. But times have changed, and “dumb” IVRs simply don’t meet the needs of today’s consumer very well. 7.ai is a leader in developing intelligent IVR solutions that provide multichannel customer service journey tracking, web-awareness, mobile optimization, and integrated voice and visuals for smooth, seamless customer journeys and faster self- service resolutions. Contact us today to learn more.
™: Delight customers with the natural interactions and increased self-service made possible by this AI-powered, IVR automated system.
PWC, The future of CX, 2018
Vonage, How to End IVR Horrors, 2019
ZDNet, Almost all Americans are frustrated with voice channels to talk to companies, 2019
Unlike traditional IVR phone systems, conversational AI-based IVR systems offer a superior customer service experience. Quickly and accurately identify customer intent through technologies such as natural language understanding (NLU), dramatically reducing or even eliminating hold times. Plus, a sophisticated IVR system increases a caller’s ability to self-serve, enabling you to handle rising call volumes without increasing agent headcount. And NLU supports unscripted interactions between the caller and the IVR, intelligently detecting customer intent and supporting natural conversations that feel human.
A better IVR experience boosts customer satisfaction and lowers costs. Happier customers and a healthier bottom line—that’s a powerful one-two punch. AI-powered conversations are natural, intuitive, and effective; customers speak the way they do normally and self-serve to get things done quickly and without friction. Advanced NLP, accurate intent prediction, and rich interactive capabilities increase self-service containment and elevate the customer experience (CX). Plus, when callers do need help from a live agent, the hand-off is seamless.
Conversational IVR Case Study
Leading Financial Services Organization Saves $1B Over 10 years
Companies invest in IVR systems primarily to reduce cost per transaction as well as to do a better job of meeting customer needs. That means empowering callers to resolve questions and complete tasks without ever speaking to an agent.
For this major bank, increasing call volumes had led to higher costs, longer handle times, and call routing challenges. By leveraging conversational IVR technology, the company made banking more automated, much faster, and more convenient for its customers.
Continually fine-tuning the system in close partnership with its voice solutions vendor enabled the bank to improve its IVR containment rate. Over the past 10 years, the bank’s conversational IVR solution has handled more than one billion self-service interactions with 99.996% uptime, saving it approximately $1 billion in net service costs.
Conversational IVR Benefits
An advanced IVR system transforms the voice channel and provides a multitude of benefits for customers, agents, and the business.
: Smart, intuitive, and human-like IVR experiences ensure more callers will help themselves.
Consistent CX across any channel
: Maintain call context as customers escalate to an agent or move across digital channels.
More complete understanding of your customers
: Knowing your customers’ journeys and intents allows you to serve them better.
Secure and convenient authentication
: Voice biometrics verifies callers with real-time fraud prevention features, without increasing customer effort.
Minimized caller frustration
: Today’s digitally savvy consumers want an easy way to get things done on their channel of choice, without agent assistance—no touch-tone inputs, confusing menu trees, or ineffective speech recognition.
Fewer spam calls
: IVRs can filter or block spam calls and allow only real callers to proceed to agents.
Less human error
: IVRs standardize support responses for issue categories, leaving less room for mistakes.
Reduced handling time
: IVRs handle intake and enable greater customer self-service, reducing the time your agents need to spend with each customer.
More customer service accessibility
: IVRs give more customers greater access to customer service, through the IVR itself and by freeing live agents to work on more challenging issues.
Controlled live agent headcount
: IVRs handle a good deal of your customer call volume and are virtually unlimited in their ability to scale.
Conversational IVR Features
Conversational AI for human-like interactions
Advanced speech recognition
: State-of-the-art NLU, with deep neural networks-based recognition and vertical intent models, improves speech recognition multifold and makes conversations feel natural.
What it enables
: Resolve customer issues faster by understanding accents, dialects, and slang expressions more accurately, even in noisy environments.
AI text to speech
: Create and deploy human-like, high-quality prompts on the fly, without the need to spend weeks recording professional voice audios. Choose from multiple languages, dialects, and voice options to suit your business needs and customer personas.
What it enables
: Instantly implement voice prompt changes.
Intelligent AI-powered dialogue
: Combine multichannel customer demographic and behavioral data to predict what a caller is trying to do—often before they even start talking. Understand open-ended, mixed-initiative responses with capabilities such as multislot handling, intent prediction, and vertical domain-based models.
What it enables
: With intent-based experiences, customers don’t try to skip the IVR—improving automation and self-serve containment.
: Natural language enables customers to speak freely, as if to a live person. Callers can express intents using multiple inputs enabled by multiturn conversational bots.
What it enables
: Deliver smoother IVR conversations, routing, and high-quality self-service by simplifying complex navigation. Respond appropriately to a sudden change of topic and ask clarifying questions to understand a caller’s intent.
Connected, digital experience
: Push rich visual content to smartphones, transforming IVR calls into interactive digital experiences. The multimodal interaction enables callers to complete complex IVR journeys in self-serve mode.
What it enables
: Combine voice and visual interactions to improve call containment rate.
: Bring the context of web browsing into calls for a seamless transition across channels. Start the conversation already knowing what they want.
What it enables
: Reduce customer frustration with relevant context transfers.
: Invite callers to jump the queue and chat or start messaging with an agent, reducing frustration while lowering support costs. Warm hand-off makes it seamless.
What it enables
: Deflect calls away from voice agents to lower-cost, faster-response channels.
Voice platform and core capabilities
: A platform that supports self-service tools for user onboarding, provisioning, and managing the application lifecycle, and a tool for advanced application development, model creation, and tuning.
What it enables
: Improve operational efficiency when deploying and updating your IVR.
: Support for single, bulk outreach, and schedule campaigns with outbound IVR calls and SMS.
What it enables
: Proactively reach customers to improve business outreach and service delivery.
Reporting and monitoring
: With comprehensive, interactive dashboards available out of the box, you can slice calls by intent and view call performance at the intent level. Further deep dive into tasks and dialogs. An easy-to-use tool allows you to create custom reports and dashboards to get the data you need.
What it enables
: Discover actionable insights to measure and optimize IVR performance.
: A cloud-based platform with a telephony-grade system built on open industry standards. Includes out-of-the-box CTI and ACD integration with the top contact center players and the highest availability.
What it enables
: Everything you need plus interoperability with all your enterprise systems.
Over 14 supported languages
: Serve more customers across North America, Europe, and Asia-Pacific with speech-to-text and text-to-speech capabilities.
What it enables
: Expand your footprint across the globe and support a diverse customer base.
Taking the right steps to verify customers and safeguard sensitive customer data is more critical than ever. The majority of contact center fraud cases originate in the IVR, and this type of identity fraud instances jumped by 350% between 2013 and 2019, according to Transunion. Similarly, financial services organizations report identity theft as the top fraud type.
Fraudsters increasingly exploit inherent vulnerabilities in traditional authentication methods such as PINs, passwords, and knowledgebase (KB) security questions. To increase security, companies often ask customers for additional personal identification.
This is time-consuming for companies and frustrating for customers.
Because human voices, like fingerprints, contain characteristics unique to each individual, voice biometrics is able to identify speakers with a very high degree of accuracy, enabling brands to provide stronger authentication with less friction.
Voice biometrics can replace or augment traditional security methods, depending on the use case and risk level. High-risk transactions requiring multifactor authentication can combine voiceprints with sensitive customer information.
Companies that design secure customer journeys see not only an increase in customer trust and confidence, but also a boost to their bottom lines. According to Experian, 74% of customers consider security the most critical factor when deciding to engage with a business.
In a nutshell: Every time 7.ai clients reduce agent talk time, it saves them money and improves their CX. Voice biometrics ensures:
A better customer experience:
Deliver more secure and streamlined customer journeys. By gaining confidence that the speaker is who they say they are, companies avoid having to transfer customers to an agent for additional security screening. That means less hassle and wasted time for callers—and the longer they stay in the IVR system, the greater the opportunity for them to self-serve.
Stronger authentication and increased security:
Voice biometrics drastically reduces the risk of theft or hacks that are prevalent with passwords and PINs. Again, that’s a win for your company and your customers.
Significant cost savings:
Voice biometric reduces operational and fraud costs and, by increasing IVR containment, allows companies to provide more self-service options within the IVR. Decrease agent handle time, minimize transfers, and reduce the burden of maintaining/resetting passwords—which cuts down IT time and manpower costs working on backend systems and integrations, too.
IVR and AI Text to Speech
Most companies use human voice talent to record IVR prompts because customers dread listening to a robotic voice. Unfortunately, that’s a complicated, expensive, and time-consuming process, requiring a long lead time plus continual enhancement and management.
AI text-to-speech (AI TTS), often referred to as neural TTS, uses deep neural networks to overcome the limitations of traditional text-to-speech systems, matching the stress and intonation patterns in spoken language and synthesizing units of speech into a computer-generated voice. This results in a human-like, natural-sounding voice prompts.
Here are just a few benefits of using AI text to speech:
Natural-sounding voice on the fly
: Convert text to lifelike speech, fine-tuned for pitch, inflection, intonation, and tempo, on the fly without any need for voice talent recording.
Accelerated time to production
: AI text-to-speech prompts are dynamically generated from raw text in real time. Easily build and deploy new IVR call flows or make changes to an existing flow in minutes instead of days or weeks.
A superior caller experience with dynamic and customized content
: Delight customers with relevant, contextual prompts such as, “Welcome back, Stephanie!” or, “Are you calling about the homeowner’s policy for 123 Anywhere Drive in Yourtown?”
Business flexibility and timely announcements
: Need to act quickly? Use AI TTS to generate on-the-spot prompts such as, “The hurricane has changed course and is now heading away from downtown.”
Multiple languages and voices
: Choose a voice that reflects your company brand with gender, persona, and speaking style.
Transform Your Voice Channel with Conversational IVR
If your company is using an outdated IVR system, you’re giving your competitors an easy advantage. Instead, give your customers what they want—the ability to quickly resolve issues on their channel of choice without having to repeat themselves, navigate a frustrating menu, or wait for an agent. Boost customer satisfaction and self-service containment while controlling costs, elevating CX, and gaining new insights in your customer journeys and intents. That’s the power of modern, AI-powered IVR.