What is IVR? The ultimate guide (2022)

The ultimate guide to call centers

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Article | 10 min read

IVR technology can be a game changer for businesses. Discover what an IVR system is and how it creates better customer experiences.

By Cristina Maza, Contributing Writer

Published September 30, 2020
Last updated March 14, 2022

  • Call centre software

What is IVR? The ultimate guide (1)

The customer service industry is continually evolving. It seems like every day, there’s a new communication platform your agents should use to stay relevant to your customers and ensure customer satisfaction. Yet there is one thing that remains constant: Consumers still prefer to use the phone over any other customer support channel. (Yes, even Millennials would rather pick up the phone than trawl the Internet for answers.)

But when call volume is high, it can lead to stressed-out agents—not to mention longer wait and resolution times, which can quickly turn any happy customer into a frustrated one. That’s where interactive voice response (IVR) phone systems come in. IVR enables you to offer exceptional over-the-phone customer support in a way that’s both time-efficient and cost-effective.

Read on to learn what IVR is, how it works, and why it creates better customer experiences.

What is IVR?

IVR definition: IVR is an automated phone system that answers incoming calls, gathers information from callers, and directs them to the right agent or self-serve option.

Your IVR system is your company’s first point of contact with customers who pick up the phone and call your support team. It’s in charge of collecting information from customers and getting them to the right place so they can resolve their issue as quickly as possible.

What is IVR? The ultimate guide (2)

IVR manages inbound calls by obtaining information from a customer—such as their account number or the type of problem they’re having—and using it to route their call to the appropriate agent.

IVR systems get that information by prompting callers to select an option using their phone’s touch-tone keypad. You’ve likely experienced this yourself when calling a business and hearing an automated menu (“For billing, press 1; for our business hours, press 2…”).

That’s an IVR menu. Some IVRs use advanced voice recognition technology so callers can say their problem into the phone’s speaker instead of selecting numbers on their keypad.

IVRs can also direct callers to prerecorded answers for common questions such as, “What time do you open today?” Instead of waiting to talk to an agent, customers can quickly find the information they’re looking for from an automated IVR system, allowing agents to focus on more pressing or complex customer issues.

Given this functionality, IVR technology is a cost-effective solution for support teams—you can resolve more issues without needing to make additional hires. Your IVR phone system may also increase customer satisfaction by providing immediate answers to basic, frequently asked questions and freeing up more agents to handle the more urgent, complicated matters.

What is IVR? The ultimate guide (3)

5 customer support benefits of an IVR system

Customers have increasingly high standards for support. According to the Zendesk Customer Experience Trends Report, 65 percent of consumers expect customer service to be faster than it was five years ago.

That’s why IVR phone systems can be a game-changer. They help customers resolve their issues swiftly without needing to be transferred between departments. IVRs can even provide 24/7 support for common problems and prioritize callers based on their customer status.

  1. Faster resolution time

    For our Zendesk Customer Experience Trends Report, we asked consumers: “Which are the most important aspects of a good customer service experience?” Not surprisingly, a resounding majority said, “I can resolve my issue quickly.”

    IVRs boost issue-resolution speed. They’re like Siri or Alexa, but for buyers. Your customers call in, they tell the system what they want, and voilà—they get the information they need quickly from the best source available.

    If you’re experiencing an exceptionally high call volume, you can set up your IVR system to split calls into different groups or categories and assign different agents to each group. Through this division of labor, IVRs reduce hold times and increase issue-resolution speed.

    (Video) What are IVR Systems? - Software Advice Video Buyer Guide

    You can also use your IVR to set up prerecorded responses to FAQs (such as, “What are your business hours?” and “What’s your business address?”). Customers can get answers to simple questions quickly without ever needing to speak to an agent.

    You can even use an IVR phone system to schedule a call back if your customer needs to speak to an agent and no one is available immediately. Customers are usually relieved to know that their questions will be answered even if they decide not to wait on hold.

    IVRs don’t just save time for customers. By deflecting and fielding simple questions, these systems also give agents more time to solve complex or pressing issues. It’s a win-win for everyone involved.

  2. Higher first-contact resolution

    Customers want their questions answered quickly without having to jump through too many hoops—68 percent of customers say they get annoyed when their call is transferred between departments. IVR helps avoid that scenario by routing calls to the appropriate agent right off the bat. This can also improve the first-contact resolution (FCR) rate, or the number of queries that were satisfactorily answered the first time.

    Say, for example, a customer has questions about a recent invoice they received. All they have to do is press the correct number on their keypad when prompted by the IVR system (e.g., “Press 1 for questions about your bill”).

    To maintain a high FCR rate, adjust your IVR phone system to fit customers’ changing needs. Maybe you’ve released a new product, and customers are calling to learn more about it. With IVR, you can improve FCR by routing those callers to the agents who know the new product the best.

    IVRs automatically route callers to the appropriate agent based on the customer’s issue. Say, for example, a customer has questions about a recent invoice they received. All they have to do is press the right number on their keypad when prompted by the IVR (e.g., “Press 1 for questions about your bill”).

    To maintain a high FCR rate, adjust your IVR system to fit customers’ changing needs. Maybe you’ve released a new product, and customers are calling to learn more about it. With IVR, you can improve FCR by directing those callers to the agents who know the product best.

  3. What is IVR? The ultimate guide (4)

    2021 Employee Experience Trends Report

    In this free report, we cover how companies are finding ways to work smarter, attract top talent, and harness the collective power of their people to get ahead.

    Read now

    (Video) What is Conversational IVR and How it Compares to Traditional IVR Systems

  4. 24/7 support

    Round-the-clock support is a key aspect of a good customer service experience. But not every business has the employee bandwidth to provide 24/7 service.

    Remember those prerecorded responses to FAQs? Yep, that’s your answer to 24/7 support.

    Here’s an example: Last weekend, your Internet went down. Unfortunately, you live in one of those towns that has only one local Internet provider, and—you guessed it—they’re closed on the weekends. Annoyed and impatient, you called their customer service number anyway. You were immediately directed to a prerecorded message that explained exactly why the Internet was out (a downed pole in your neighborhood). The message even gave a timeline for when the company expected repairs to be completed.

    The goal is to leave the customer feeling as if they always have recourse. Even if you don’t have support agents working 24 hours a day, your customer wants to know that you take their needs seriously, and an IVR can help you make that clear.

    Say a customer needs to cancel their credit card after experiencing a security breach. A 24-hour call center that uses an IVR phone system can let them do that even if there’s no one currently working. Your customer doesn’t have to wait until Monday to cancel their card when they know someone has accessed it without their permission. Knowing that they can count on your business any day at any time reduces the customer’s stress and increases brand loyalty.

    With IVR, 24/7 service is possible, no matter how big or small your company is.

  5. Call prioritization

    Imagine that two customers call your support number at the same time. Customer #1 pays for your lowest-tier subscription, valued at $20 a month. Customer #2 pays for your VIP package, valued at $250 a month. Which one would you help first?

    Customer service representatives need a system for prioritizing calls based on potential impact. After all, 58 percent of consumers stop buying from a company after a single bad customer service interaction. You simply can’t afford to make high-value customers wait.

    With an IVR system, you can assign priorities to specific phone numbers. When a VIP customer calls support, they’ll instantly be placed at the top of the queue and assigned to the most capable agent.

    You can also use call history to determine how quickly you should route a call to an agent. Suppose a customer has already called five times that day needing urgent support. In that case, it’s wise to direct them to an agent as quickly as possible to avoid frustration and improve the overall experience. But if the customer has called once and indicates they’re looking for an answer to a routine question, you can use an automated response for their query.

    With an IVR phone system, you can set up intelligent routing based on criteria that meet your company’s and customer’s needs. This makes your valuable customers feel valued and cared for, increasing their satisfaction.

  6. Omnichannel customer service

    IVR can help support an omnichannel customer experience strategy, too. When businesses take an omnichannel approach to CX, they consolidate information from a variety of support channels—including the phone, live chat, and email—and use it to inform the way they interact with the customer. This enables support teams to reference the customer data they need when they need it, regardless of the channel they’re using.

    For example, imagine a customer calls your support team regarding an issue with their online order. Your IVR phone system captures the customer’s details and the reason for their call, and then routes them to a knowledge base article about tracking, exchanging, and canceling orders. But the article doesn’t help the customer resolve their issue, so they’re connected to a live agent via chat. The agent who assists them receives all the relevant context captured by your IVR—meaning the customer doesn’t have to repeat themselves—and can offer a solution more quickly.

    The ability to move interactions seamlessly from one channel to another is what an omnichannel customer service experience is all about. A customer may choose to reach out via phone, but they might be given the option to receive their response in an email or a messaging app, and context won’t be lost along the way.

    An omnichannel customer strategy allows agents to provide a faster and more personalized experience, leading to happier customers. According to the Zendesk Customer Experience Trends Report, companies that provided omnichannel support had faster response times and higher customer satisfaction scores.

IVR and personalized customer support

While an IVR phone system has many benefits, there can be pitfalls as well. If the questions aren’t specific enough, there are too many questions, or the technology you use has poor voice-recognition capabilities, your customers could get frustrated.

That’s why an interactive voice response system that offers some level of customer self-service and personalization is so important. High-quality voice-recognition technology is also key.

Our phones aren’t going anywhere anytime soon, so for an easy and cost-effective way to respond to more inbound calls, consider implementing an IVR system.

(Video) How To Build an IVR System with Twilio Studio

(Video) WEBINAR: The Ultimate Guide to Conversational IVR in the Cloud!

What is IVR? The ultimate guide (5)

2021 Employee Experience Trends Report

In this free report, we cover how companies are finding ways to work smarter, attract top talent, and harness the collective power of their people to get ahead.

Read now

2021 Employee Experience Trends Report

In this free report, we cover how companies are finding ways to work smarter, attract top talent, and harness the collective power of their people to get ahead.

Read now

What is IVR? The ultimate guide (6)

FAQs

What is IVR stands for? ›

Interactive Voice Response (IVR) is an automated telephony system that interacts with callers, gathers information and routes calls to the appropriate recipients.

What is IVR strategy? ›

Highlights: An IVR system guides callers through an automated menu to get them to a specific destination. A poorly-designed IVR menu leads to a negative contact center customer experience. Designing a positive IVR experience involves giving customers self-service options as well as the ability to connect to a human.

What is IVR and its benefits? ›

An IVR is often the first interaction between a caller and an organization when calling into a call center, therefore it can influence the caller's perception through its tone of voice and ease of use. An effective call center has the IVR system integrated with the CRM and other contact center systems.

What is IVR and examples? ›

An example of IVR is when you call a company or business, and then you hear “press 1 for technical assistance, press 2 for sales support, press 0 to speak to the operator”. After you make your choice, your call is routed to an extension/call queue, or, for example, a voice message is reproduced to you.

Where is IVR used? ›

In telecommunications, IVR allows customers to interact with a company's host system via a telephone keypad or by speech recognition, after which services can be inquired about through the IVR dialogue.

What are key features of IVR? ›

Key IVR Features
  • Information Provider. Upon calling a system, an IVR menu can be used to provide a caller with extremely useful information. ...
  • Call Filter. ...
  • Identification. ...
  • Call Queuing & Callback Automation. ...
  • Voice Recognition. ...
  • Call Recordings. ...
  • CRM/IVR System Integration. ...
  • Self Service Actions.
26 Mar 2022

What are the different types of IVR? ›

Inbound and/or outbound

The two basic types of IVR services are inbound and outbound. Inbound IVR systems handle incoming call volume, while outbound IVR systems make calls on either a total or partially automated dialing basis.

How can I improve my IVR experience? ›

How do you improve IVR design?
  1. Always provide customers with a live agent option. ...
  2. Make 'call recording' announcements only on transfers. ...
  3. Offer a non-primary language at the end of the initial menu. ...
  4. Keep main menu options to 30 seconds. ...
  5. The IVR should sound like an associate.
7 Jan 2021

Why do companies use IVR? ›

IVR technology helps businesses manage a large number of inbound callers by routing them to the right place automatically instead of relying on a receptionist who may struggle to handle peak call volumes. At the same time, callers get to the people they need to talk to more quickly.

What is IVR mapping? ›

What Is an IVR Mapper? An IVR mapper is a hosted/cloud service that is used to map out your IVR and call center systems. This will then produce interactive web documentation of your IVR trees and call flows.

What does IVR mean in banking? ›

IVR (Interactive Voice Response), one of the most effective technologies that can help a bank to automate its interactions with its existing or potential customers.

What is smart IVR? ›

A Smart IVR is an enhanced Interactive Voice Response system. It allows companies to streamline their communication by intelligently routing and managing inbound calls. Also, it helps companies reduce unnecessary steps that paid employees usually handle.

How long should an IVR be? ›

Get the Right Music to Message Ratio

Have a message that lasts for no more than 20 seconds and then a music interlude in between that lasts for 30 seconds, so it feels like there's more music than message.

How is IVR testing done? ›

What is IVR Experience Testing? Experience testing refers to 24/7 testing of the Customer Experience being delivered by IVR systems. Essentially, it's an automated secret shopper. Test calls are made at regular intervals to ensure everything is working correctly all the time.

What is the IVR number? ›

What is the IVR number? An IVR number is a phone number with cloud telephony features that attends and routes your customer calls automatically without any manual intervention. Both the incoming and outgoing calls can be managed through an IVR number and your business message can be delivered to them hassle-free.

How long does an IVR transfer take? ›

Callers can switch to agent-assisted payments from IVR self-service payments at any time. Usually, the process takes no more than five minutes from start to finish.

How does call center IVR work? ›

The caller listens to the IVR system menu, responds by pressing a key on his or her phone, and the system reacts accordingly. Based on the caller's answers, the IVR either provides him or her with the required information (e.g. account balance, order status, etc.) or routes the call to the correct agent.

Which company has the best IVR? ›

144 products
  • Twilio. Twilio is the worlds leading cloud communication platform that enables you to engage customers across channels - SMS, voice, video, email, WhatsApp and more. ...
  • GoTo Connect. ...
  • Bitrix24. ...
  • Acefone. ...
  • Gupshup. ...
  • VoiceGuide IVR. ...
  • Dextr. ...
  • Fastcall.

How is IVR system implemented? ›

IVR Design - Create a design specification of the application. IVR Development - Organize a development team and assign tasks. IVR Programming - Perform actual coding of the IVR application. IVR Testing - Test the IVR application prior to going live.

What is IVR development? ›

IVR development is a component of an IVR project where a programming team is assembled and assigned tasks to compete the creation of an automated phone answering program. IVR technology allows a phone caller to interact with the phone system without operator intervention.

When was IVR invented? ›

This article is part of a larger series on VoIP. The history of interactive voice response (IVR) systems started in the 1930s when the Voder machine was created. This technology was the first to analyze the English language and produce human-like audio.

What is the difference between IVR and VRU? ›

What is a Voice Response Unit? A voice response unit (VRU), more commonly known as an IVR system, is technology often found in call centers that manages the front end of inbound phone calls. Voice response units (VRUs) typically play a recorded greeting for callers and then present them with menu options.

What does a good IVR look like? ›

Your IVR should sound like an empathetic person is interacting with the caller, who has a clear idea about caller's needs. Because what is being said over the IVR, depicts how well your business can empathise and understand their need and deal with their respective issues.

How many options should an IVR have? ›

The conventional wisdom regarding these options according to Bruce Belfiore, CEO and senior research executive at BenchmarkPortal is that the branching tree structure of an IVR “should be no more than five (options) across (in the top menu) and three (submenus) deep.

Do customers like IVR? ›

Statistically speaking, your customers hate IVR—83% of them think it provides either no value at all or a cost-benefit for the company. With more and more people turning to mobile apps and other channels, one might think IVR systems must be going downhill.

What is the future of IVR? ›

The future of IVR holds the promise of greater personalization and contextual awareness that will elevate the customer experience. Customer issues present themselves in endless variety. With an IVR system in place, the most common customer problems can be tackled with an automated response.

How can I make an IVR call for free? ›

We were able to track down one option: Ekiga.
  1. Ekiga. The only totally free IVR software option to make it into the list, Ekiga is a softphone which offers free SIP addresses. ...
  2. MicroSIP. ...
  3. Voxibot. ...
  4. Zendesk Talk. ...
  5. Aspect CXP Pro. ...
  6. VBVoice. ...
  7. Verboice. ...
  8. Genesys PureCloud.
20 May 2019

How can I make my own IVR for free? ›

To create a Cloud IVR menu sign into the Sonetel web app and move to the Voice apps section.
...
Options when creating a new message
  1. Upload audio file. Upload WAV files MP3 files etc.
  2. Text to speech. Type a text and have it converted to a recording in the language of choice, using Text-to-speech.
  3. Record.

Whats an IVR PIN? ›

The PIN is a 4-digit number used to access an account by phone when using our Interactive Voice Response (IVR) system. To update the PIN: Log in to your account. Go to Account Features and select Edit Account. Enter a 4-digit number in the IVR PIN field, then scroll to the bottom of the page and click Save.

How does IVR work PPT? ›

Interactive voice response (IVR) is a technology that allows a computer to interact with humans through the use of voice and DTMF tones input via keypad. Interactive voice response (IVR) is a technology that allows a computer to interact with humans through the use of voice and DTMF tones input via keypad.

What is IVR What are inbound and outbound IVR? ›

Inbound IVR phone systems route phone calls through your system and attempt to anticipate customer expectations. On the other hand, outbound IVR technology works by alerting existing clients about an appointment or gives them a critical emergency notification.

Is IVR payment safe? ›

If your IVR Payment Processing system is Payment Card Industry (PCI) compliant, it is a safe and effective solution for your customers. When being PCI compliant, it means your business follows the technical and operational standards ensuring that the cardholder's data is protected.

What does SMS stand for in banking? ›

Sample 1. SMS Banking means the Bank's SMS banking service which provides the Customer services such as information relating to Account(s) of the Customer, details about transactions and other services as may be provided using 'Short Messaging Service' (SMS).

How do you record IVR messages? ›

How do you record IVR messages? You can record your IVR message by using the voice recording option in your call center software. First, you need to create an IVR group for a department or a service, and then you can record your voice.

How do you ask for a call back? ›

Now, I'll share some expressions that you can use to ask someone to call you.
  1. Please call me when you are free.
  2. If you can manage time, can you call me tonight?
  3. Call me later, please.
  4. Don't forget to call me please, it's urgent.
  5. If you are available this weekend, please call me. ...
  6. Hey! ...
  7. Call me as soon as possible.
19 Jan 2022

What are IVR tools? ›

IVR tools are used for multiple purposes like customer calls, providing information, taking down details, etc. As a result, it helps Banks, Insurance companies, the Telecom industry, the travel industry, etc. Customers do not wish to visit branches or offices to solve their queries.

Can we automate IVR? ›

There are several automation tools available which impersonate the human effort to dial an IVR specific telephone number and can provide DTMF inputs to the IVR system. Nowadays large companies are using an automation tool to test their IVR application.

What does IVR mean in banking? ›

IVR (Interactive Voice Response), one of the most effective technologies that can help a bank to automate its interactions with its existing or potential customers.

What is an IVR payment? ›

Interactive voice response (IVR) is a telephone payment system. It allows consumers to make an automated payment over the phone without interacting with a live person. IVR payment services add value and build revenue for your business – all without hiring any additional staff members.

What does IVR stand for in Cisco? ›

Cisco Unified IP Interactive Voice Response (IVR) - Cisco.

Is IVR payment safe? ›

If your IVR Payment Processing system is Payment Card Industry (PCI) compliant, it is a safe and effective solution for your customers. When being PCI compliant, it means your business follows the technical and operational standards ensuring that the cardholder's data is protected.

What is the IVR PIN? ›

This is a 6 digit number that is assigned to your permit at time of creation. To locate the pin number, you have two options. 1. The easiest is to simply look at your posted permit. The IVR PIN number is located at the top on the right hand side below the Issued Date.

What is IVR What are inbound and outbound IVR? ›

Inbound IVR phone systems route phone calls through your system and attempt to anticipate customer expectations. On the other hand, outbound IVR technology works by alerting existing clients about an appointment or gives them a critical emergency notification.

How long does an IVR transfer take? ›

Callers can switch to agent-assisted payments from IVR self-service payments at any time. Usually, the process takes no more than five minutes from start to finish.

What is smart IVR? ›

A Smart IVR is an enhanced Interactive Voice Response system. It allows companies to streamline their communication by intelligently routing and managing inbound calls. Also, it helps companies reduce unnecessary steps that paid employees usually handle.

How can I make an IVR call for free? ›

We were able to track down one option: Ekiga.
  1. Ekiga. The only totally free IVR software option to make it into the list, Ekiga is a softphone which offers free SIP addresses. ...
  2. MicroSIP. ...
  3. Voxibot. ...
  4. Zendesk Talk. ...
  5. Aspect CXP Pro. ...
  6. VBVoice. ...
  7. Verboice. ...
  8. Genesys PureCloud.
20 May 2019

Does IVR require Internet? ›

As we mentioned before, contact center IVR systems don't require technical expertise to be implemented. With more progressive IVR technologies, all that is required is an internet connection and a browser. Your IVR will take a few minutes to set up— you can use pre-recorded messages to expedite the setup process. 2.

How can I pay my 3 bill online? ›

Log in to your My3 account with your Three phone number and password. Under Bills, click Pay your bill by card.
...
Pay by credit or debit card
  1. Open the Three app.
  2. Tap More.
  3. Tap Pay bill by card, follow the instructions and save.

Can I pay my Virgin Media bill by credit card? ›

Paying Virgin Media bills in instalment

So long as you don't pay by Direct Debit, you'll be able to pay your bill online using a credit or debit card.

What is IVR developer? ›

What Is IVR Development? IVR development is a component of an IVR project where a programming team is assembled and assigned tasks to compete the creation of an automated phone answering program. IVR technology allows a phone caller to interact with the phone system without operator intervention.

What is the difference between IVR and VRU? ›

What is a Voice Response Unit? A voice response unit (VRU), more commonly known as an IVR system, is technology often found in call centers that manages the front end of inbound phone calls. Voice response units (VRUs) typically play a recorded greeting for callers and then present them with menu options.

What is IVR company? ›

IVR stands for interactive voice response. Companies and other organizations use it to route incoming calls. Contrary to what the name might imply, IVR systems don't necessarily rely on prompts spoken by callers to route their calls. The term also means routing calls based on keypad presses.

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