The real cost of missing a call
You’ve heard us chat about this before. The real cost of missing a call, especially on the first attempt. First, it may not shock you to know that 75% of callers hang-up if they get a voicemail. However, did you realize that 85% of those callers, never call back? Obviously, the potential revenue loss is substantial, but just how substantial?
Let’s find out just how much it costs to miss a call
A few weeks ago, our Director of Operations, Brandon, held a webinar about your phone line as your life line. In it, he opened with an example of the actual monetary cost to missing a call from a prospective customer. Here is the breakdown he supplied: For the sake of this example, let’s assume your average customer order comes in around $75 and the average amount it costs to take a call is $5. Using these parameters, it is pretty clear to see that the cost to missing one call is $65. However, what if that customer was actually calling to book a 12 week package, with one order per week for the next 12 weeks. The cost to take the call is the same, but the potential revenue jumps to $900. In this scenario, the cost of missing the call jumps to $895.
Intangible costs to missing a call
However, that’s not where it ends.
Wasted Marketing Efforts
Let’s start to take into consideration some of the intangible costs to missing this call. For instance, you likely spend money on various sources of marketing for your business. In most cases, this marketing is aimed at driving calls to your location. Now that you’ve missed this call, that money that you’ve allocated to promotion, is essentially wasted.
Since we now know that 85% of callers do not call back, we can safely assume they have moved on to the next company on their list. If that company, your competitor, was able to take that call, then they are reaping the benefits of that new customer, including their lifespan purchases and referrals.
When you’re unable to manage your calls, it sends a message to your clients that you are not managing your business well enough to handle inquiries. It doesn’t take much for a potential customer to wonder if that mis-management will lead into your product or service delivery.
Lifetime Value Loss of missing a call
In our example at the beginning of this article, we broke down a few examples of potential revenue loss from a call. However, what you really need to look at is the potential lifetime loss of missing that call and potential new client. To calculate this amount, you must first determine what your annual average customer value is. To do this, multiply your average order value ($75 in our example above) by the average number of orders you receive from a single client in the run of a year. For this example, let’s assume you see this client weekly for 4 months of the year, approximately 16 orders/year. So, in this example, the annual average customer value is $1200. Now, you must determine what your average customer lifespan is. For our example, we’ll say 5 years. Therefore, the approximate lifetime value loss for a single client is $6000. That is a substantial loss for missing a single phone call. If you’re looking to up your game but having an in-house receptionist isn’t in the cards, consider hiring a virtual receptionist. Our customized service helps to bridge this gap, keeping your reputation in tact and your books in the black. Click here to get started!