There’s a good chance you’ve called a customer service hotline before and encountered a voice asking you to press a number to select a self-service option or wait in line for the next available agent. That’s an IVR system, and many businesses use one as the first contact point for their customer service operations.
IVR, or interactive voice response, is the technology behind the automated system that routes callers to the right department or representative. It uses voice prompts to guide customers through a menu that they navigate on their own.
IVA, on the other hand, stands for interactive virtual assistant, which is the voice-activated technology behind digital sidekicks like Siri, Alexa, and Google Assistant. In addition to personal IVAs, it’s also possible for businesses to have a custom IVA system. These can do the job of an IVR while also performing some of the tasks that once required the help of live representatives.
The Main Differences Between An IVA and an IVR
Both systems can effectively manage incoming calls, leading to reduced wait times and increased customer retention. On the employee side, this also means that agents won’t have to spend as much time routing and rerouting calls, making them more available to handle urgent and complex issues.
As things get more technical, however, some key differences make IVA the better choice for many businesses.
- IVR systems are menu-driven, which requires callers to respond to pre-recorded voice prompts by pressing a number or by saying a predetermined keyword. IVAs are conversation-driven, so callers can speak naturally like they are talking to a real person.
- An IVR system is limited to its menu options and can only understand responses that align with its programming. IVAs can understand a wider range of responses and requests, so there’s no true limit to what customers can ask.
- IVAs can operate independently without requiring live agents—though they can still escalate calls to human agents if needed. An IVR system is often limited to the working hours of the call agents because it’s mainly used for routing callers to the most suitable department or agent based on customer responses.
- While an IVR system has limited data collection and analysis functions, an IVA can track and analyze customer history in more detail. For example, IVAs learn from past interactions to provide more relevant responses, and they can also listen for and understand customer sentiment in real time.
- An IVR system only needs pre-recorded prompts and menus in order to be set up and run—with minimal maintenance to boot. Meanwhile, IVAs require technical expertise and ongoing maintenance to remain accurate and efficient.
Why an IVA Wins the IVA vs. IVR Battle Every Time
IVR technology is useful, but apart from its primary function of routing callers, it can only handle simple tasks like updating account information, scheduling appointments, resetting passwords, and processing certain orders.
Since IVAs use AI and machine learning technology like natural language processing (NLP) to mimic human interactions, they can handle far more complex issues—on top of all the things an IVR can do.
The main limitation of an IVR system is that it can’t support a true two-way conversation, since it depends on menus and pre-recorded voice prompts. Thus, when a customer interacts with an IVR system, they’re presented with limited options and can’t give a response outside the scope of the pre-programmed call flow. If a customer gives a response the IVR system isn’t programmed to understand, it will either rerun the voice prompts or play an error message, ultimately leaving the caller stuck.
Since IVAs can understand and respond to more advanced open-ended questions, they don’t limit the customers as much. At the same time, they also give callers the freedom to move a lot quicker without having to wait through long pre-recorded voice menus.
IVAs are also available 24/7, which means they can handle some of the more complex tasks outside of business hours. Of course, cloud IVR systems can be available at all hours as well, but if a given task requires a representative, the customer will have a more limited calling window. As a result, IVAs can help lower operational costs and may even reduce staffing needs.
Finally, an IVA can also be far more useful for collecting customer data from caller interactions. This kind of information is usually stored in your customer relationship management (CRM) system, which can easily be integrated so that agents can access relevant details from any past interactions. While an IVR can do this to some extent, an IVA can provide personalized experiences to customers without the help of an agent.
There is a catch to IVA winning the battle
Depending on the needs of your customers and the complexity of their issues, it’s possible that an IVA can’t provide the same level of service as a live agent. If this is resoundingly true, an IVA will probably be ineffective and cause customer dissatisfaction.
If you’re familiar with the phrase, “garbage in, garbage out,” then you know that the quality of output is oftentimes dependent upon the quality of input. With an IVA, this can be applied in two ways.
First, you should understand that your IVA can only provide relevant answers based on the information available to it. In other words, if you don’t prepare it adequately, it can’t help your customers effectively.
Second, if your callers don’t know what to say, then your system will have a harder time guessing how to respond. This requires a lot of preparation in order to educate your callers on how to use the system and access its knowledge base.
A knowledge base is a large online library containing guides, articles, product information, and FAQs about your business that allow the IVA to answer and handle customer queries. As such, your knowledge base requires constant updates and maintenance to ensure that the IVA continues to provide up-to-date responses to your callers.
An IVA must also be able to understand the customer. This includes words or sentences as well as the intent and sentiment behind their request. Unlike an IVR system that only listens for keywords following a preprogrammed call flow, an IVA must understand the full context of the call.
To achieve this, IVAs require technical setup and maintenance to ensure accuracy and effectiveness. In most cases, it must be trained by an individual or team with the time and knowledge of natural language processing, natural language understanding (NLU), and IVA systems as a whole.
When you put all of this together, it’s clear that an IVA requires a lot of work and expertise to get things right. However, when everything works smoothly, an IVA can be a gigantic step up for your business and its customer service operations. That said, if you want to make your employees’ jobs easier, lower your operational costs, and improve customer satisfaction at the same time, an IVR can still do that—just not as much as an IVA.
