What is First Contact Resolution and Why is it Important?

January 16, 2024

Your clients, when facing an issue with a product or service you have provided them with, will seek a quick resolution that minimizes their downtime and creates a streamlined experience for them. 

You know how it feels when your business technology isn’t working quite right, so it should be easy to put yourself in your client’s shoes and understand why they expect urgency and efficiency in their interactions with your support staff. As a business owner, however, you may struggle to determine how to deliver what your clients want. 

Your best bet is to train your customer support team to focus on increasing their first contact resolution rates, but even then, you may ask, “What is first contact resolution?” and wonder how to measure it.

Read on to learn how your first contact resolution rate, a key performance indicator, can help you better serve your clients and boost your bottom line.

What is First Contact Resolution? 

First contact resolution (FCR) refers to a customer support agent being able to solve a client’s problem or address a particular need during that client’s first customer service interaction. Because the agent has appropriately handled the client’s issue, there is no further need for either party to follow up, contact an alternate department, or escalate the matter to management.

The Importance of First Contact Resolution 

First contact resolution is important because it plays a significant role in both the level of satisfaction your clients will have with your products and the sentiment they’ll hold toward your business. Be that as it may, it’s important to note that first contact resolution customer service benefits more than just your clients; it can also help you decrease costs and increase revenue

With that said, if you’re not yet convinced that FCR is worth your attention, here are six benefits you’ll reap when you prioritize it:

Exceptional Client Service

Client service is a powerful tool for brands. In fact, 66% of consumers say that a terrible interaction with a company can ruin their day, and 80% of consumers believe that their experience with your brand is just as necessary as the products you sell. As such, when you make an effort to resolve clients’ issues quickly and efficiently, it clearly indicates that you are committed to providing excellent service and making (and keeping) your clients happy. 

Higher Sales Revenue

A recent Salesforce brief reveals the following metrics, which take shape when clients trust a brand:

  • 92% will buy more products and services
  • 90% will buy more frequently
  • 86% will spend more money

Perhaps the most crucial part of building trust with your clients is ensuring a great experience at every turn. If you can consistently resolve problems during initial points of contact, you are more likely to earn your clients’ trust —Loyalty — and money — as a result.

Improved Client Retention

Building trust is crucial for maintaining customer loyalty, as evidenced by an astounding 95% of clients affirming their trust in a company directly influences their loyalty. Given that a high first contact resolution rate establishes a strong foundation of trust, prioritizing efficient client service becomes instrumental in retaining the maximum number of clients.

Furthermore, since acquiring a new client can cost up to seven times more than retaining an old one, building trust through exceptional service should be at the forefront for every member of your organization.

Controlling Your Costs

Virtually every business owner seeks to achieve two primary goals — maximizing profits while finding ways to reduce costs — but you may not realize that pursuing a high first contact resolution rate can help you achieve them both. 

High first contact resolution metrics often lower call or contact volumes while promoting greater efficiency among your support team. As a result, you can hire fewer support agents, cutting down on business costs without sacrificing customer service.

Improved Productivity

Ensuring your employees can consistently deliver excellent service with minimal wait times to a large number of clients each day is critical. However, achieving this becomes nearly impossible with low first contact resolution rates, as it leads to a situation where your service lines are frequently occupied by repeated contacts from clients who could not obtain a satisfactory answer during their initial interaction.

When you sincerely try to increase your instances of FCR, you’ll also be able to increase your teams’ productivity levels. Fewer repeats will help more clients get served, benefiting your business in every way.

Higher Employee Satisfaction

Satisfied employees are essential to avoiding the significant costs associated with high turnover rates. Fortunately, having a first contact resolution improvement plan can help you create a happier workforce that is likely to stay in their positions for far longer. Employees won’t be frustrated by repeatedly dealing with the same client and problem, and appreciative clients who are grateful for a quick and efficient resolution are much more pleasant to deal with.

How to Measure First Contact Resolution Rate 

Business owners generally use the following first contact resolution rate formula:

  • (Resolved Incidents on First Contact / Total Incidents) x 100

The standard rate across most industries is 70-75%, though rates can vary widely depending on the sector and business model. In any case, you must keep a few things in mind to ensure your calculation is accurate when using the formula. 

First, it's critical to acknowledge that certain businesses and products may not naturally lend themselves to being resolved in a single contact. If you are in such a situation, a practical approach would be to focus on cases that can feasibly be resolved within one interaction and limit your analysis to that specific subset of data. Doing so can ensure a more accurate assessment of your first contact resolution performance.

In addition, you must be aware that you cannot always know whether a case has been fully resolved. Sometimes, clients simply don’t realize they still have a problem, or they become dissatisfied with their original received answer at a later date. Unfortunately, it’s hard to track whether they contact you again after some time. 

To resolve these instances, ask the client if their issue was resolved at the end of the conversation or send them a summary of your interaction that allows them to reopen their ticket should they still need help. In doing so, you’ll more accurately track valid resolutions and observe whether clients are returning for more assistance with the same issue.

First Contact Resolution: Best Practices

Simply knowing why first contact resolution is important isn’t enough: You must now map out your next steps for improving your customer experience. The following section will give you insight into best practices as you create a first contact resolution improvement plan and work to ensure you are offering the best customer service in your industry.

Define Your First Contact Resolution Metrics

Before you can improve (or even measure) your first contact resolution rate, you must have a well-defined idea of the following aspects:

  • When an issue counts as “resolved”
  • What is considered “first contact”

For example, if an agent has to escalate a call to management or the client needs to be transferred to a different department, you need to determine whether your teams still consider those interactions “first contact.” 

Likewise, you must know when cases count as “resolved.” Is it the case if the client does not make repeat contact within a specific time frame, or will verbal feedback confirm whether the customer received a satisfactory resolution?

When you have a clear first contact resolution definition in mind, your team can properly analyze data and create action plans to improve. 

Find Out What Drives Repeat Contact

Improving your FCR requires understanding what drives your clients to make repeat contacts. Sometimes, your interactive voice response menu is too complex, which causes clients to be sent to the wrong agent or department; in other cases, clients may provide agents with incomplete or incorrect information.

When you take time to get to the root of the problem, you can devise a targeted solution instead of wasting time on remedies that won’t solve the issue.

Properly Staff and Train Your Team

You must have enough members of your team to match your average call volume, and those agents must be well-trained and equipped to provide your clients with the level of service they expect from your brand.

Overwhelmed customer support reps may feel the need to rush through the interaction, forgoing critical steps that would otherwise lead to an efficient resolution, and poorly trained representatives may give clients outdated or incorrect information, prolonging the first contact resolution customer service process and increasing the chances of the client making contact again for the same problem.

Improve Communication All Around

Clear communication between internal team members (as well as to and from customers) is vital in ensuring issues are efficiently resolved, but “better communication” can be a vague idea. The following are specific suggestions to help your team thrive:

  • Use frequently asked question pages and knowledge bases to make answers to common issues accessible to your team
  • Use unified communication tools to get real-time answers from your team in other departments instead of transferring clients or calling them back
  • Manage customer expectations and actions with clear messaging and resources
  • Ensure agents are giving clear instructions and repeating all information back to clients for increased clarity
  • Always ask clients if they need help with anything else at the end of the call

When everyone involved communicates clearly, the likelihood that clients will get what they need increases.

Follow Up with Customers and Collect Feedback

Use customer feedback surveys to follow up with as many as possible after interactions with your team to gauge sentiments about the customer experience. Doing so will allow you to gain critical insight into unique needs and desires that may be going unmet.

A Seamless Customer Experience Drives Business Revenue

Working to improve your first contact resolution rate is always a good idea. Still, you must understand that the idea behind high FCR numbers is ensuring that businesses are moving toward creating a seamless, client-focused experience that builds trust, creates loyalty, and ultimately increases revenue.

That isn’t an easily-accomplished goal: It takes time and effort to gather customer feedback, analyze it to understand needs, drivers, fears, questions, and sentiments, and then create and implement a viable first contact resolution improvement plan.

The good news is that Client Savvy has two decades of experience using data to create profitable outcomes for professional services firms. Our robust customer feedback tool helps you collect and explore critical data to identify friction points and effectively take action to shore up weaknesses or challenges.If you’re ready to take your client experience to the next level, contact Client Savvy today at answers@clientsavvy.com  to learn more about how your business can use client feedback data to drive revenue and meet your long-term CX goals.

Blake Godwin

Partner, President at Client Savvy, has helped firms of all sizes realize revenue potential through solving critical business problems for over 20 years. Through Client and Employee Experience Strategy, Blake empowers and enables his clients to capitalize on opportunities while accomplishing both short- and long-term Strategic Priorities.

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