While there are more channels than ever for customers to engage with companies, phone calls remain the most preferred option for customers and prospects to make initial contact and seek ongoing support from a business. Given the call volume that modern companies are tasked with handling, it’s no surprise that automated answering systems are considered a necessity for many operations. However, all automated answering systems are not created equal and conversational IVR represents a significant step forward for the technology.

Auto-attendants are great for guiding calls through a handful of menu options with pre-recorded voice messages and interactive voice response technology (IVR) can be a worthwhile upgrade for allowing your customers to navigate these menu trees with basic voice commands. At the same time, poorly designed push-button menu flows can confuse or frustrate customers, many of whom simply press 0 to bypass the automation and speak with a live agent – the most expensive asset to any company’s customer support.

Conversational IVR takes auto-attendants and IVRs to the next level by enabling more human-like interactions with natural language processing, artificial intelligence and machine learning. Instead of being walked through a series of prompts where callers answer specific questions that advance them down a maze of menus, conversational IVR makes this process more organic by allowing them to speak with the system similarly to how they might converse with a live customer support representative.

Standard IVR vs. Conversational IVR – What’s the Difference?

Whereas traditional IVR systems allow callers to use basic voice commands such as “yes” or “no,” conversational IVR allow people to communicate their inquiries in more complete phrases and plain language. Callers can describe questions or concerns in their own words and the flexibility of a conversational IVR can adapt to these circumstances and provide customers with a more human-like interaction.

Much of this flexibility is derived from the conversational IVR’s ability to learn. For instance, when a caller says something that a conversational IVR doesn’t quite understand, a live agent can silently intervene and guide the system through the situation. The next time it encounters a similar situation, the system will require less intervention and eventually be capable enough to handle a variety of tasks on its own.

Traditional (non-conversational) IVR systems ultimately depend on number selections or similarly basic input from the customer and have minimal ability to adapt, which can be particularly annoying when someone makes a mistake with their input such as pressing one wrong button while entering a long account number. They also tend to take much longer to dispense basic information such as office hours, which can be nested in a series of menus, and are generally less personal, having a limited set of responses.

Conversational IVRs enable a more free-form experience for customers, who aren’t bound to a specific menu script. These advanced IVRs are more convenient and better at guiding customers toward self-service type solutions instead of involving a live agent. Not only does this maximizes employee productivity and save companies money on staffing cost, but in a best case scenario it makes for happier customers who get fast, personalized responses from an automated system that isn’t entirely stripped of the human touch.

Is Conversational IVR Right For My Business? And Why Now?

The larger your organization is and the more calls you’re fielding on a daily basis, the greater benefit you’ll see from implementing conversational IVR. Granted, while a nail salon or book store might find some benefits in upgrading from a simple business voicemail greeting to a basic auto-attendant, a full-fledged conversational IVR is unlikely to be worthwhile.

That said, if your current answering system is four or five menus deep and your agents struggle with timely answers to some of the calls they receive during peak volume spikes, installing a conversational IVR is likely to be beneficial and may bring a return on investment sooner than you expect.

Conversational IVRs are can reduce live agent calls by half, with similar potential figures for improvements in the accuracy of call routing and customer satisfaction – navigating long menus and sitting through lengthy wait times isn’t an experience any customer wants. On the contrary, modern customers expect more than ever to receive fast support and from engagements that are as simple as possible.

Saving 10 or 20 seconds for agents and callers on each exchange might not matter for small businesses, but for large scale enterprises, that kind of improvement comes with broad-sweeping implications and huge savings.

The average cost of a live agent customer service phone call can be more than $30 depending on who you ask and this adds up quickly if your company is handling thousands of calls, not to mention the overhead of hiring new staff. In one report, IBM reported that worldwide companies spend over $1.3 trillion to serve 265 billion customer calls each year.

Along with decreasing the amount of time to serve each customer and serving more customers in less overall time, conversational IVRs can handle these calls more consistently. They never break from company policy, for instance, and there’s less of a skill cap involved with machines – they can always continue improving.

Why now?

Whereas customers once held a greater dislike for automated answering type technologies, opinions are shifting toward acceptance amid the rising adoption of personal assistants such as Siri, Google Now, Cortana and Alexa. People are increasingly familiar with these technologies, the ways they can be used and their limitations. Customer satisfaction numbers for popular voice-controlled assistants are as high as 80% or better depending on the platform and survey.

The Bottom Line: Conversational IVR Provides Better Support

Conversational IVR modernizes traditional IVR concepts with technologies such as AI and machine learning, which can understand and respond to customer inquiries spoken in an organic way instead of navigating push-button menu flows. So when calling a bank for instance, you may simply be able to say “check balance” right off the bat instead of progressing through a series of menus before reaching that prompt.

This allows conversational IVR systems to complete requests faster via self-service options without involving company associates. Along with maximizing call center efficiency and helping to offset spikes in call volume, conversational IVR is said to reduce customer churn, boost brand perception, and ultimately contribute toward client retention.