In business, time is money. This saying rings especially true for entrepreneurs, who are always looking for ways to optimize their operations to reduce turnaround times and increase profits. One critical metric that can have a significant impact on an entrepreneur’s bottom line is first response time (FRT). In this guide, we will explore what FRT is, why it matters, and how you can improve your FRT. Let’s get started!
What is First Response Time (FRT)?
The First Response Time (FRT) measures the average length of time it takes for an agent to respond to a customer inquiry or support ticket. This metric provides valuable insight into the level of customer service your business delivers and the efficiency of your contact center operations. A fast FRT demonstrates your commitment to customer satisfaction and reflects the maturity of your team.
Why Is It Important For Startups To Track First Response Time (FRT) Metric?
Zendesk research has demonstrated that low First Response Time (FRT) leads to happier customers. This can positively impact the Customer Lifetime Value of these customers, making them more profitable for your business. An American Express survey found that satisfied customers spend 14% more than others.
A good FRT can also reduce your Churn Rate. To know more about the churn rate, read our guide here(insert link). While lower prices may initially attract customers, without quality customer service, customers may be more likely to turn to competitors for their needs. According to a study by Bain & Company, service-related problems can make customers four times more likely to move on than if they had experienced problems with price or product.
FRT issues can make customers feel like they are not receiving good service, and this can have a major impact on your ability to attract new customers. American Express has found that, on average, 46% of American consumers tell eight people about their good service experiences. However, regarding bad customer service experiences, 60% said they tell an average of 21 people.
Satisfied customers can also become a source of referrals for your business, as one of the major reasons customers switch to a new brand is due to recommendations from friends and family. Therefore, it is vital to keep your customers happy and satisfied.
Maintaining a low FRT ensures that your customers receive good quality service and remain satisfied. This will help to keep them loyal and increase your customer base. Having good customer service is essential in the long run for any business.
How do you calculate First Response Time (FRT)?
The average first response time (FRT) is calculated by summing all the FRTs over a specified period (e.g., one month) and dividing that total by the number of tickets resolved in the same period. This enables you to determine an accurate picture of your FRT performance. Here’s the formula:
Sum of First Response Times / Number of Tickets = Average First Response Time
To get a precise measurement of your team’s performance in actual conditions, it is important to leave out automated responses (like those from chatbots or virtual assistants) and tickets that come in outside of your regular business hours. For example, 64,000 seconds ÷ 800 resolved tickets = 80 seconds FRT.
Using this number, you can assess your performance compared to other periods or against industry averages. It can also help you understand the impact of staffing levels on your FRT. You can make informed decisions to improve customer experience and satisfaction with this information.
By understanding the FRT metric, you can give your customers an accurate sense of how long they should expect to wait for a response. This helps to build trust and loyalty, which is essential for any successful business.
What factors affect First Response Time (FRT)?
Several factors can affect FRT, including:
The complexity of the problem:
The more complex the issue, the longer it can take to resolve it. A simple issue can often be fixed quickly, but more complex issues require a thorough analysis and investigation before any resolution can be found.
The availability of necessary resources:
If the necessary resources, such as personnel or technology, are unavailable to solve the problem quickly, it can take longer to resolve.
The skills and experience of the support team:
If the support team needs to be adequately skilled or experienced in dealing with certain problems, it can take longer to resolve them.
The communication channels:
If the support team has limited access to the customer (for instance, if they are located in a different time zone), it can take longer to communicate with them and address their issue.
The priority level of the issue:
If an issue is deemed urgent, it may be given a higher priority and dealt with more quickly.
On the other hand, if an issue is considered a lower priority, it may take longer to resolve.
VC quotes on First Response Time.
The speed at which you respond to a customer query is of utmost importance regarding customer satisfaction.
Jamie Edwards, COO and Co-founder of Kayako, states: “First reply time is more important than overall reply times because it’s an acknowledgement to the customer that their issue is being addressed.”
Generally, the faster you respond to customer queries, the better your customer satisfaction levels will be. It is also important to remember that different communication channels have different expectations regarding response times. You must take these into account when managing customer communication. By recognizing and responding quickly to customer needs, you will be able to build a better rapport with them which ultimately result in greater customer satisfaction.
What is a good First Response Time (FRT)?
Companies that achieve customer satisfaction on a “exceptional” level have been proven to have higher brand loyalty. This is due to the increased standards set by renowned brands like Amazon and Netflix. To measure a company’s success in this regard, research conducted has highlighted the following characteristics:
- Email FRT – 30 minutes or less
- Live chat FRT – 15 seconds or less
Is the first response time competitive in the channel?
The specifics of FRTs and customer expectations can vary greatly across channels. To provide some guidance in this regard, below are a few basic benchmarks for customer satisfaction:
- Good: 12 hours or less
- Better: Four hours or less
- Best: One hour or less
Social Media
- Good: Two hours or less
- Better: One hour or less
- Best: 15 minutes or less
Live Chat
- Good: One minute or less
- Better: 30 seconds or less
- Best: 15 seconds or less
Is your first response time competitive in the industry?
Obtaining reliable figures for competitive FRTs can take time, as many companies tend to keep this information confidential. However, after doing some research, we were able to locate a few reports with measurements and benchmark FRTs for various industries from trusted sources. For reference, the following are some of the reported figures:
Email inquiry first response times:
- Real Estate: 15 hours
- Corporate Travel: 36 hours
- Logistics: 12 hours
- Financial Sector: 14 hours
- Retail: 17 hours
What is a bad First Response Time (FRT)?
A bad First Response Time (FRT) is any response time that takes longer than the expected timeframe for a customer service team to reply to a customer’s query. This can be due to many factors, such as poor staffing levels, slow systems, and processes, or a lack of automation. In any case, a bad FRT can lead to customer dissatisfaction, which in turn can cause damage to your brand reputation and long-term customer loyalty. It can also lead to lost sales and possible legal action as customers become increasingly frustrated at your team’s lack of timely response.
What are tips for decreasing First Response Time (FRT)?
Here are the tips for decreasing the first response time:
Invest in automated monitoring and alerting:
With the help of automated monitoring tools, IT teams can be alerted about performance issues before users notice them. This prevents issues from becoming too severe and allows IT teams to quickly address the problem before it impacts user experience.
Use performance-based metrics:
Performance-based metrics, such as throughput, memory usage, and CPU utilization, can help IT teams identify any bottlenecks in production. By monitoring and optimizing for these specific metrics, IT teams can prevent issues from getting out of hand.
Train support staff:
Providing end users with adequate support is key to reducing FRT. Investing in training for technical support staff can be beneficial as it gives them the necessary knowledge and skills to resolve any issues that may arise quickly.
Ensure availability of resources:
Ensuring that all systems have adequate resources is essential to maintain performance levels across all organizational areas. This includes hardware, software, storage, and networking.
Leverage technology:
Utilizing modern technologies such as containers, microservices, and cloud-based solutions can help to improve performance. These technologies allow for rapidly deploying new services and applications that can be easily scaled up or down when needed.
Analyze customer feedback:
It is important to monitor customer feedback and use it as a guide for improvement. Incorporating customer suggestions can help reduce FRT by ensuring customer needs are met promptly.
Tools To Calculate First Response Time
Several tools are available for measuring and tracking FRT, ranging from simple stopwatches to more advanced analytics platforms. Here are the tools:
Stopwatch:
This is the most basic tool for measuring FRT. A stopwatch can measure how long a customer service representative responds to a customer query.
Analytics Platforms:
Advanced analytics platforms can be used to measure FRT on an ongoing basis. These platforms allow users to set parameters and thresholds for tracking FRT and monitor performance over time.
Customer Experience (CX) Software:
CX software packages are designed to provide detailed customer feedback, including FRT metrics. This type of software can help track customer service performance and measure the effectiveness of customer service agents.
Automation Tools:
Automation tools are also useful for tracking FRT. These tools can automate customer service processes, such as routing inquiries and responding to common queries. This tool can help reduce the time it takes for customers to receive a response, improving FRT.
Conclusion
You’ve now learned everything about First Response Time, what it is and how important it is for your business. Now that you understand this powerful metric, you can start using it to increase sales and conversions on your website.