Call Center Metrics: Cost Per Call

Find out what cost per call is, what the ideal cost is and more.

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As a commonly cited KPI, cost per call is a financial measure of contact center efficiency that compares your center’s total operational costs to its total number of calls; it can also be figured by agent. Common costs per call range from just over $1 to more than $8, depending on the factors included and the size of the company. In today’s contact center, cost per call should be evaluated as part of a larger metric mosaic including revenue per hour, contact ratio, and cost per transaction, among others.

As a commonly cited key performance indicator, cost per call is a financial measure of contact center efficiency. Its goal is to compare your center’s total operational costs to its total number of calls.

The simplest cost per call measurement is by agent. For a ratio that is tied directly to individual agent costs, start with payroll; for a total, indirect ratio, gather all additional costs associated with an individual agent, such as training, and divide by the number of calls made. To be meaningful, all numbers have to be crunched down to a definable time period such as an average hour, day, or week.

To generate this total metric for the entire center, add in an average of operational costs related to all agents, such as facilities, supervisors, equipment, etc., as well as an average number of calls made, again within that definable time period.

 

How High Is Too High?

Common costs per call range from $1-$3 in direct costs to more than $2.50 to $5.50 in indirect costs. For smaller shops, the fully loaded costs can be up to $8 or more per call.

When determining how high a cost per call is too high, contact center managers must walk a fine line. They must balance the needs of the company, as expressed in operational concerns like overhead, with the needs of the customer, whose opinion of each customer-service interaction just keeps growing in importance. In short, most of today’s contact centers are charged with lowering costs without also lowering the quality of customer service.

The true impact of cost per call can’t be adequately determined in a vacuum. When it comes to setting an appropriate cost per call for your center, consider the context of your business goals and the center’s initiatives that have been based on those goals. For instance, have recent campaigns encouraged higher call-in service rates? Are your agents heavily involved in upselling or cross-selling? Consider the full picture of cost per call alongside other KPIs such as revenue per hour or contact ratio.

 

Finding Your Center’s Sweet Spot

Here are some ideas for lowering your center’s cost per call to the level that makes the most sense for your enterprise:

Make your plan, work your plan
Does your center have established service-level standards and budgets that have already been maximized for your operation? For instance, a common goal is to answer 80 percent of calls in 20 seconds – but when you pursue the logic of that goal, it doesn’t make sense for every contact center. Would your team be more effective at a slightly “lower” goal? Would it have an undue effect on your customer service ratings?

Monitor those calls
Implement live call monitoring, which increases call quality by allowing managers to listen in on live calls as well as to record calls. Managers can then ensure quality during any call and also use recordings for future training and quality purposes.

Send attrition into decline
Today’s satisfied, long-term agents are powerful employees. They are directly responsible for lower levels of customer churn, higher net promoter scores, more company growth, and a stronger company brand. Just consider what happens with higher attrition rates: It’s been estimated that, excluding induction, phone agents require just over 10 weeks to reach full competence. Not only can less experienced agents answer fewer calls, they can’t address queries as effectively. Therefore, a center with higher attrition has to staff enough agents to take up the slack from the new agents – along with more supervisors, more technology and licenses, and other operational needs.

Combat attrition by evaluating your initial hiring requirements (are you hiring the right person to flourish in what an agent’s job has become?), providing excellent training, and making room for feedback and coaching programs among the team.

Efficient scheduling
Cost per call can be brought down simply by paying attention the details of who needs to be where. Consider factors like peak call times and when to best use part-time workers to supplement your team.

 

Almost There

You’re probably thinking by now, however, that it’s no longer just about the call. Contact-center agents now have to deal with well-informed customers and increasingly complex queries received through any number of channels. It’s been reported that metrics for cost and time per interaction are neglected on digital channels; in 2016, 83 percent of centers surveyed tracked calls, but only 66 percent tracked web chat and only 60 percent tracked email interaction.

Today’s contact centers should measure cost per call, cost per contact, and cost per transaction. These related metrics all include certain expenses, including:

  • Direct, indirect, and management labor costs
  • Benefits and incentives
  • Training and recruitment
  • Hardware and software
  • Occupancy

However, it’s daunting to get a grip on the myriad statistics your center could be tracking from all its channels. One of the best ways to tackle that challenge is to get a 360-degree view of every interaction with every customer through any channel.

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