IVR and the benefits of using Interactive Voice Response

Learn what IVR means and how it helps you serve your customers.

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What is Interactive Voice Response? (IVR)

IVR, short for Interactive Voice Response, is a software that automatically answers the phone instead of an agent when a customer contacts your customer service contact center. It asks the customer for information — like their preferred language — so that it can automatically direct your customer to a more relevant agent who can help them.

Why do you need IVR?

To provide optimal customer experience, you should give each of your customers the most relevant, helpful service for their needs when they first contact your customer service department. Connecting them automatically with the best agent to handle their issues helps increase first call resolution and your customer service efficiency. IVR and its modern equivalents gather data and information so that you can do that.


“You’d be amazed how much time we save when the system itself handles the call results, transfers contacts automatically between call lists, and lets us see client’s calendar availability on the same screen. It might feel like a few seconds here and a minute there, but adding them up throughout the day makes a huge difference, which in turn is extra revenue.” – JC Phoner (read the full case study here).

Data is crucial for better customer service

Data plays a key role in matching relevant agents with customers, but how is this data extracted? Some data is collected using Automatic Call and Message Distribution process via CRM integrations and other data sources. However, in order to provide more relevant service on a case-by-case basis, some data is best collected directly from the customers.

The traditional way to collect customer data is to apply an IVR, which lets the customer provide information that helps the contact center categorise their service requests. By stating whether their issue is about, for example, technical support or billing, the customer can be directed to the right queue straight away without wasting time.

In addition to collecting customer data, the IVR is also crucial in relaying information to customers, especially when anticipating many service requests on one issue. For example, if there is an issue or error that the company is resolving at the moment, an IVR can convey the message to thousands of customers without wasting agent resources.

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IVR features and benefits that help your customer service

A high-quality IVR brings concrete performance improvements to your contact center.

Divide by Service Level Agreements (SLAs)

IVR helps identify and divide your customers depending on their relationship with your company. Premium customers with higher service level agreements can be fast-tracked so they receive service more quickly.

Improve first-contact resolution and customer experience

IVR helps categorise customers based on their immediate need, bringing them to the right agent in the right department. This improves first call resolution and customer and agent satisfaction.

Provide 24/7 service

If there are no agents available around the clock, customers can solve simple issues or leave a call back request through an IVR or a chat decision tree. This provides a cost-efficient option for contact centers to offer customer service at all times.

Simplify reporting

First-contact resolution simplifies reporting. When a customer is bounced from one queue and agent to the next, the report for that contact gets complicated, as well as frustrating the customer.

Plan future customer service strategy

Every time a customer provides information to the contact center, the data can be stored, analysed and used to improve the whole customer service operation. For example, you can use this data to find seasonal changes that have to be considered when planning queues and staffing.

Reduce operational costs

Accurate distribution makes the whole operation more efficient. When your agents get more relevant cases, they solve issues faster, reducing time wasted on transferring cases.

How to create an IVR

The easiest way to create an IVR is to use a customer service software like LeadDesk. Building an IVR is typically not difficult, but it involves mapping an IVR call tree.

IVR call tree and IVR language
An IVR call tree defines the potential stages that your customer goes through when calling your customer service.

For example, when working in a multilingual country or business, the first phase of your call tree might be to define the IVR language for the rest of the call by asking the customer for their preferred language of service.

Next, you’ll ask what their issue is about. For example in the case of a telecommunications operator, you might ask whether they are contacting about cellular connections or landline internet.

Finally, you could ask whether they need help with technical matters or with invoicing.

With the above options, and assuming you offer your service in two languages, your IVR call tree already has 8 branches. These eight branches will direct the callers into eight different queues.

IVR Scripts and IVR Prompts
For each stage in your call tree, you have to define the message that the customer will hear and how they will respond. This is known as an IVR script, which consists of IVR Prompts i.e., messages. The prompts can either be a recorded human voice (typically as an MP3), or you can just type in the message you want to hear and a robot will read it aloud.

Speech-enabled IVR and conversational IVR
Customers typically respond by dialling keys on their phone using the touch-tone menu (e.g. dial 1 for service in English). However, in certain cases you might want to use a speech-enabled IVR, also known as a conversational IVR.

A speech-enabled IVR lets your customer respond by talking on their phone instead of dialling options. The system then uses natural language processing to convert the speech to text. Using a conversational IVR can be useful for example when customers would otherwise have to type a long series of numbers (such as a loyalty card number).

The best IVR service provider

Whether you are small business or a large multinational company, in today's omnichannel world, concentrating on calls alone isn't enough. 66% of people contact customer service using at least three channels, which means that you need a contact center software that can use data from all channels. That's why the best IVR system is one that collects data from other channels as well.

The best IVR flows allow flexible data collection

Decision trees in chatbots can perform the same function as an IVR for customers who don't call by phone. An IVR flow builder allows you to carefully plan the customers' journey through the IVR system. A good IVR flow builder should include these features:

  • Multi-level menus for accurate customer distribution
  • Omnichannel approach with both voice and text to satisfy customer needs
  • Announcements or greetings at any point in the menu for flexible interaction
  • Option to distribute to a specific queue or directly to an agent for improved first-contact resolution
  • Callback option for flexible service
  • Forwards and redirects for efficiency.
  • Try an easy and efficient IVR for yourself

    Optimise your contact center with a flexible IVR that you can easily customise yourself. If you'd like to find out more about the whole Automatic Call & Messaging Distribution process, take a closer look at our full guide on the topic.

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