Businesses have to make spending decisions every day. Whether it’s about buying a new piece of equipment, or hiring an additional employee, business owners want to know that they are going to get a reasonable rate of return on their investment. So how do you calculate whether investing in a call answering service like TOUCH will give you a good return? One way to do this is to calculate the opportunity cost of a missed call.
Why do missed calls matter?
Even the most diligent of companies cannot answer every call, every time. In most cases, when all lines are busy, the caller will get transferred to a voicemail. But to think that a voicemail system is a way to catch missed calls is, for the most part, wishful thinking. That’s because 80% of callers won’t bother to leave a message. A few might call back at a later time, but most will just call someone else – they’ll call your competition. That means lost sales and lost opportunity.
What do missed calls cost your business?
There are a couple different ways to calculate the cost of a missed call.
First, let’s consider the fact that many businesses nowadays actually pay for incoming calls from potential customers. How is this so? They pay web marketing campaigns for SEO and PPC services to drive potential customers to websites and landing pages. Say a business spends $20,000 each month on web marketing which results in 1,000 incoming calls. That means that each of those calls is costing $20. Missing a mere 10% of those calls is like throwing $2,000 out the window.
The second way to calculate the cost of a missed call is in terms of lost revenue. If every call is a potential sale, the price of missed calls adds up very quickly. Say for example, that one in ten calls results in a sale and the average sale is $10,000. Of the 100 calls that your business misses, 10 would have resulted in sales had they been answered. That equals $100,000 in lost revenue.
When you consider what percentage of those callers might have been repeat customers or might have referred your business to someone else, the numbers can climb even higher. While each company’s number of calls, conversion rate and average sale will be different, one thing is clear – missed calls are bad for business.
Impact on company image
There is one more way in which missed calls can impact a business – and this one is not quite as easy to calculate in financial terms (even though it does have an impact). Not being able to answer the calls of your customers and prospects, is bad for your business’s image and its brand.
We’ve all had that experience, where we tried to reach a company and simply couldn’t get through. Do you remember the impression that you had of that business at the time? Chances are it wasn’t very good. Perhaps it was enough to prevent you from doing business with them – or maybe you were so frustrated that you spoke negatively about the company to others.
On the other hand, when you call a business and get a friendly and professional person on the phone right away, it gives a very good impression.
The opportunity cost of a missed call is obviously going to be different for every business. But make no mistake, there is a cost. Take some time to figure out what these lost opportunities are costing your business, and then invest in measures to gain them back.