We created the ROI calculator to better illustrate to brands the positive impact that Conversocial's platform can have on both customer engagement, and as a result the bottom line. Our research has found that on average, Conversocial's partners saw a 300% ROI within 12 months of signing up.
As Principal of Strategic Initiatives at Conversocial, I wanted to create an interactive tool that lays out exactly what our platform can do. All that's needed is a few metrics that most companies already have on hand, and our calculator can do the rest. Rather than explaining the intricacies of the tool in black and white text, I put together a short video below, explaining how it works.
Now that you've seen how it works, I also wanted to go a little deeper and explain the process that went into creating the calculator and the data science behind it. Understanding ROI of Conversocial's platform vs traditional channels is essentially a combination of working out Cost Per Contact + Cost of Labor, and seeing the time and money that can be saved if you sign up as a customer.
If you want to work out what your ROI would be as a Conversocial customer, please check out our calculator here and get in touch to set up a demo.
"We'll dive into the two core cost drivers that the model is based on. We'll start with the 'cost per contact'- essentially boiling it down to, what is the cost you're paying to engage with a single customer? And when we say engagement, all that really means is a conversation- an end to end interaction.
The way we took 'cost per contact' is really looking at total platform costs; what are you paying for the technology to facilitate the engagement with consumers? Let's look at that for the whole year, and divide it by the overall channel volume that you're getting. So if your platform costs are $100,000 a year and your channel volume for the whole year across all channels is 100,000, your cost per contact is a dollar. Using that same example, we compare that against a platform such as Conversocial, and we do that direct measurement.
Let's say for example, the cost per contact on Conversocial is 75 cents, as compared to a more traditional, heavier platform that has phone, that has email, that has live chat. You have a cost per contact savings there; it's 25 cents. We take those 25 cents and you multiply it back by that original volume, it's a hundred thousand, right? So you then start to understand that $25,000 in savings is your cost per contact savings for the year.
Now the other side of it is the 'labor cost savings.' The way we look at labor cost savings is by using total handling time. Total handling times is a collection of all the time, across all agents, that was dedicated to handling issues. We then look at that through an average handling time, and we want to multiply that out by the total channel volume for the year. We take that overall handling time and multiply it by the agent hourly rate.
What we want to do then is look at how a solution like Conversocial impacts the average handling time. The more the bot self-serves and resolves conversations, the less amount of effort overall of that time goes to the agents because the bot is essentially solving some of these inquiries on their behalf.
The logic behind how we're looking at the labor cost savings is that initial piece of that conversation through phone is eliminated because our automation is handling that front part. So we then look at what the total handling time was before the automation, and then after.
If we say that our solution is going to reduce 10% of the handling time, 20% of the handling time, we then take that new handling time on total and we multiply it out by the original agent hourly wage that we did prior to the automation. We take both the cost per contact and on the labor side, we bucket that as total benefit. So what we've come to see with a good amount of our accounts is the benefit outweighs the initial investment of the Conversocial platform.
On average, we see a 300% ROI on our accounts from this analysis that we did on some of our customers. And it is because of that unique combination of using the more modern messaging channels, automation, agents, and how we help delineate that really make a smooth handover between the two.
This initial calculator was very customer center focused, where we wanted to focus on what the cost implications and the cost benefits would be for a solution like ours. But we also acknowledge and understand that's just one third of the customer journey. We have to look at the marketing perspective and how do consumers actually land into an experience to begin with? And then there's the transactional side. If you're selling products and services, how do consumers transact on your digital channels and what you currently offer?
The unique thing about our solutions and when we use automation and messaging, is that our platform supports the entire journey. So it's not just customer care, it's also the marketing and acquisition side, and it's also the transaction and engagement side. We've been looking at and exploring use cases that generate revenue such as transactional use cases or booking of services. We're looking at how does that generate revenue, what's the overall conversion rate on folks that do go into messaging and make a transaction? What does the average transaction cost? We want to use that benchmark, look at a year, and help you understand that yes, we are driving costs down, but messaging is also a great opportunity to position itself for revenue driving use cases as well.
If we look at marketing, there are a good amount of use cases that could be used to promote services, to promote products. There's proactive messaging that could be used to really serve as follow-ups or reminders for consumers.
Once you use the calculator and get a good understanding of what the potential return on investment could be with our platform, that really opens up a conversation to talk about. How do we work as strategic partners with you to do an analysis of your customer experiences and really look at the end-to-end experience from different channels?
We want to look at the entire ecosystem of digital channels that your brand offers, and we really want to interweave our solution into these experiences to make it more fluid, to make it more convenient, and to make it more efficient.
Once you reach out, look at the calculator and find appealing numbers, it's a really good opportunity to set up a demo and look at the next steps. To see how more closely to what your brand does and how we can tailor some of that experience to show you some of the capabilities in depth and take the conversation from there.