Call centers for large corporations can handle up to 9 million calls yearly, making the cost per call a fundamental KPI. While your business may not run through hundreds of thousands of calls per month, the metric is essential in limiting operating costs, testing new technology, and making the point of contact as beneficial to customers as possible.
In this post, we’ll cover how to calculate the figure, which is the first step in optimizing your call center cost per call benchmark. In addition, we provide the data you need to assess before you can accurately calculate how much it costs to run an efficient call center.
Why is tracking your cost per call important?
Determining cost per contact is essential for businesses, especially in high-volume call centers. The difference between a few dollars per call can substantially save a company in operating costs and help improve efficiency.
Other reasons why tracking cost per call is important include:
- Performance Evaluation: Tracking provides insights into the effectiveness of different call strategies and allows for informed decision-making to enhance overall call center performance.
- Customer Experience Enhancement: By gauging costs per call, you can streamline processes, invest in better technologies, and enhance training to improve customer satisfaction.
- Benchmarking and Comparison: Reaching industry standards for cost per call will help your company stay competitive and continue evolving strategies.
What data do you need to calculate your cost-per-call?
To accurately calculate the cost-per-call, you'll require various data points contributing to the overall expenses incurred during call center operations. The data includes your total operating expenses (OpEx) and capital expenses (CapEx).
Employee wages and benefits
Salaries, bonuses, incentives, and benefits provided to the call center agents and staff directly handling calls encompass a significant portion of the cost-per-call calculation. Ensure you are recording expenses beyond wages per hour.
HR expenses
Human Resources costs must cover recruitment, training, and any other HR-related expenditures to maintain a workforce capable of managing inbound and outbound calls efficiently.
Call center overhead
Include all operational costs necessary for running the call center facility, such as rent, utilities, maintenance, and other facility-related expenses that support the function of the call center.
Software subscriptions
The costs associated with call center software and tools used for call management must also be included in your operating expenses. These costs include customer relationship management (CRM) subscriptions, helpdesk software, analytics, and other technological solutions to facilitate efficient call handling.
Total calls handled per agent
Understanding the volume of calls each agent manages provides crucial insights into workload distribution and efficiency. This data is essential for determining the allocation of costs per call on an individual agent basis.
Formula for calculating cost per inbound and outbound call
Once you’ve acquired the necessary data, you can calculate the KPI within a specific period.
Use the following formula:
Cost per call = OpEx + CapEx ÷ (number of calls)
If you want only to calculate inbound calls, separate the costs for taking calls and use the same formula:
Cost per inbound call = OpEx + CapEx ÷ (number of inbound calls only)
Do the same for outbound calls, including departments such as sales, collections, fundraising, or market research.
Outbound cost per call = OpEx + CapEx ÷ (number of outbound calls only)
Cost per call example
Here’s an example of the monthly cost per inbound call for a small virtual call center with five customer service agents. Let’s say employee wages and benefits cost $4,000 per month; HR expenses come in at $5,000, the software costs $500, and overheard is $1,000.
Total cost = $10,500
The total number of calls averages 30 per agent daily, reaching 4,500 monthly inbound calls.
$10,500 ÷ 4,500 = $2.34 average cost per inbound call.
According to CX Today, this is well below the industry average of $2.70-$5.60 per call.
Updating your approach to calculating cost per call
Breaking down types of calls into groups can provide a more accurate picture of your cost per call. For example, a sales call could require more resources than a customer service inquiry. However, the sales agent is responsible for generating revenue; therefore, investing in a higher cost per call makes sense.
Automation has also changed how we determine cost per call. For example, AI customer service agents can handle basic inquiries, potentially reducing labor expenses. However, the infrastructure costs will increase. When implementing new technologies, we recommend paying close attention to your cost per call. The addition of automation should reduce the total price, but investment could take time and some adjustments to start paying off.
How to reduce cost-per-call
If you are in a position where your cost per call does not meet the industry standard, you can take various measures to reduce this cost.
Invest in agent training
Empower your agents with comprehensive training programs to enhance their communication skills, product knowledge, and problem-solving abilities. Well-trained agents can handle calls more efficiently, reducing call durations and the need for call escalations.
Optimize ticket escalation procedures
Refine escalation protocols to ensure that only complex issues requiring higher-level assistance are escalated. Implement tiered support systems and equip frontline agents with adequate tools and authority to resolve standard queries, minimizing unnecessary escalations and associated costs.
Invest in the right software
Investing in comprehensive call center software yields substantial cost-saving benefits. Technology like co-browsing, console logs, and session replays are indispensable tools that help reduce your cost per call and provide a more beneficial and comprehensive customer service experience.
Cobrowsing expedites technical issue resolution by granting agents screen control. Hands-on troubleshooting helps agents reach a faster resolution and instills understanding for users. This capability is invaluable for tackling complex problems that are arduous to resolve over the phone, email or live chat.
Session replays and console logs streamline issue comprehension for agents. These tools eliminate the need for extensive user explanations by providing detailed session recordings and system logs. When these tools are in place, agents can immediately grasp user problems, saving valuable time.
In addition, CRM software and multichannel support tools play pivotal roles. CRM systems streamline data management and customer interactions, while multichannel support software ensures seamless communication across various platforms. Each software type significantly reduces the cost per call by enhancing agent efficiency and problem-solving capabilities.
Conclusion
Cost per call is the foundational KPI for measuring success at call centers. Remember that monitoring the figure is not all about cutting costs but also optimizing operations systems, testing new software, and elevating the overall customer experience.
Efficiency-driven strategies like agent training, streamlined procedures, and cutting-edge software, including cobrowsing, session replays, and console logs, pave the way for cost-effective call centers. These tools revolutionize issue resolution by granting agents hands-on screen control and facilitating quicker technical problem-solving. By implementing these tools, you can reduce your cost per call and ensure agents are empowered to provide the care your customers deserve.
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Sources last checked: 12-Dec-2023
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