Customers don't like talking to machines.

Editorial by Niels Kjellerup, Editor of the Call Centre Managers Forum website. April 3rd 2000.

To illustrate this article I have streamed this sample of an irate customers calls to show how IVR will escalate frustration -Warning, very explicit language. (Note it is a Windows Media file, you can download the player here http://www.microsoft.com/windows/windowsmedia/en/download/default.asp).

Background: For years it has been a badly  kept secret that customers don't like talking to IVRs - research after research in the US, in Europe and in Australia have confirmed this. The question begging to be asked is " Why do companies continue to deny customer access by making mazes of IVR-menus ?". And the answer " because it costs money, lots of money, to give customers access to a live representative of the organisation ". We in the Call Centre Industry need to understand, that there is balance between excellent customer service and cost/benefit, and the use of IVR is unavoidable to cope with unpredicted rise in call volumes or to get customers to segment themselves, but what we're seeing is not a well judged use of IVR. Its basically an  indiscriminate use of IVR to fudge service levels (% of calls answered within a set timeframe) to hide the fact that call centres really don't want to talk to customers and that they are not welcome at all. The results are that Call Centres are rapidly becoming synonymous with bad or indifferent service.

New research: The latest research by Mintel, GB just confirms the trend of more IVR means bad service. ( I have reproduced the press release from Mintel ) Pls note that the research also contains some interesting predictions about the growth of on-line financial services.

CALL CENTRES - CAUSE FOR CONCERN?
A new report from Mintel highlights the anger and frustration experienced by consumers when faced with an automated telephone service. Latest research from Mintel reveals time spent on hold as being the greatest cause for concern for consumers phoning call centres.    Despite figures forecasting a double in the market size by 2003, nearly 24 million adults miss the personal touch offered by a branch or office.
Anger and frustration for over 28 million adults
Almost 60% of the 1,946 adults questioned, accounting for over 28 million adults, get angered or frustrated with the service they receive when using automated telephones.   Of greatest annoyance is the time they spend on hold, which is cause for concern for 44% of adults, followed by the music played, which annoys a further 36% of consumers.   Those living in Scotland are considerably more patient than Londoners, with just 30% resenting time spent on hold compared to half of those living in London.
Nearly one fifth of adults claim to hang up frequently or all the time after being caught up in an automated telephone system of a financial services provider.  Another 24% of adults sometimes hang up.
Issues causing anger and frustration for automated telephone service users,
November 1999
Base:  1,946 adults aged 15+
                                                                 
                                             All adults          
                                                                 
                                                       %                
                                                                 
                                                                 
                                                                 
  The time I spent on hold               44               
                                                                 
  The music played                         36               
                                                                 
  Not finding the option I need        29               
                                                                 
  The synthetic/automated voice      27               
                                                                 
  Missing the option I want              23               
                                                                 
  The sales messages heard             18               
                                                                 
                                                                 
  No, none of these                         42                
                                                                 
  Source: NOP/Mintel                                             
                                                                 
700 million calls to be made this year.

Mintel estimates that in 2000 around 700 million calls will be made from UK residential phone lines to call centres working in financial service sectors, equating to 2% of all calls made from UK homes. Calls to other non-finance, call centres will account for a further 6% of all call volumes.  This equates to an average of 15 calls per person being made to finance call centres in 2000.
Some 48% of adults had a telephone banking facility available in 1999.  In 1995, around 6% of adults used their telephone banking facility, growing to over 18% in 1999.
In terms of telephone usage, 22% of all adults use the telephone to make general enquiries into financial services and/or products.  Nearly one fifth use the phone to obtain account balances, while 16% use the telephone to pay bills and look at account debits and credits. Around 27% of respondents aged 25-34 buy financial service products like motor and home insurance over the phone, while another 32% use the phone to arrange credit in the form of a personal loan or credit card.
Half of adults miss the personal touch
Despite the widespread use of call centres, 49% of respondents or around 23.6 million adults agree they miss the individual service  that going to a branch or office offers. The majority of consumers - almost 70%, do not appreciate incoming sales calls.   In fact only 15% of adults are actually willing to listen to incoming calls offering services on behalf of various institutions.  Those aged 15-19 are the most tolerant to sales calls with 25% of this age group accepting calls, in contrast to under 10% of those aged 65 plus.

There is a higher level of tolerance for listening to sales calls when making outgoing calls, compared to listening to sales messages from incoming calls. Some 24% of adults, or around 11.6 million people, said they would welcome news of products their main current account provider is willing to offer when they contact them by telephone.
Call centres to make up 1.6% of work force by 2003

Mintel estimates that by 2003 there will be 270,000 employees working in the call centre sector, equating to around 1.6% of the full-time work force.  Many of these employees will be working in the financial services sector.
Mintel estimates that around 37% of call centres in the UK are financial services operators. Currently, only 5-10% of financial service companies outsource some of their call centre function to a bureau, with the rest having their own call centres.   However, it is forecast that more financial services providers will outsource call centre functions in the future.
Telephone banking will double by 2003
Mintel forecasts that by 2003, 32% of adults will use phone banking, just over double the current penetration. Around 28% of mortgages, and 2% of life policies will be sold directly, using call centres, this will usually be combined with the Internet and post for signatures. The most successful finance products to be sold directly will be those that combine simplicity with value for money.  Products like motor insurance and current accounts will all achieve at least over 10% of sales by direct channels.
"Even providers that are entirely Internet-based need a customer service function, which will inevitably require human interaction" comments Sarah Watkins - Finance Journal Manager.

The 'Call Centres' Research  is available from Mintel.  Price: Pound Sterling 1,500
Contact : www.mintel.co.uk or voice +44 171 600 5703.  Fax: +44 171 606 5932

 

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