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Interactive Voice Response (IVR)

Interactive voice response (IVR), also known as a phone tree, provides an automated telephony system for callers using voice and touch-tones (DTMF).

Customers don't like to wait in an age of lightning-fast connectivity. Incoming calls flood today's organizations with customers who want their questions answered pronto.

Interactive voice response (IVR)(link takes you to an external page) is an automated telephony system that helps companies handle inbound calls efficiently. In its basic form, IVR—also known as an interactive voice recording or interactive voice recorder—uses voice recognition and touch-tone keypad selections to steer callers through menu options and information.

Also called a phone tree, IVR works with automatic call distribution (ACD) to route inbound calls to the best departments and agents for customer inquiries. IVR also gives callers information and helps them complete tasks without ever speaking to a human representative. This frees agents to handle more complex customer concerns, shortens hold times, and eliminates extra hiring.

Learn how to build a self-service IVR system that wows your customers. Contact Twilio for support(link takes you to an external page).

How does an IVR work?

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IVR saves companies time and money by speeding up calls and requiring fewer agents to handle customer inquiries. The main features that allow IVR to process requests include dual-tone multi-frequency (DTMF) signaling and voice recognition.

DTMF signaling occurs when callers select menu options using their keypad. They "press 1 to make an appointment, 2 for billing," and so on. In other words, this technology routes callers to the departments and specialists most likely to address their needs—reducing hold times. But some callers get impatient with inefficiently designed menu options.

That's why more advanced IVR incorporates increasingly sophisticated voice recognition technology to help customers handle tasks on their own. The most cutting-edge technology is natural language processing (NLP), which can understand full sentences instead of mere key presses or simple commands. When done well, NLP resolves customers' questions quickly and makes calls more enjoyable, improving their impression of the business.

How do callers interact with an IVR system?

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From a caller's perspective, IVR is a common phone menu that prompts them to press touch-tone keys that emit DTMF tones or say words that speech recognition detects.

Here's a breakdown of the process:

  1. The customer calls and IVR presents a phone menu of options.
  2. The caller listens to the options and responds by pressing a key that emits a DTMF tone to select an option or speaking to built-in speech recognition software.
  3. The caller navigates the menu, responding to questions or prompts that resolve their call.
  4. The caller is sorted by IVR with skill-based routing when self-service can't resolve their need.
  5. The caller finds agents to address their needs through the IVR system's ACD technology.

What are the parts of an IVR system?

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Once upon a time, IVR relied on many expensive components to function:

  • Interactive voice recording software
  • Agent hardware
  • Traditional telephone equipment
  • In-house infrastructure
  • Multiple servers
  • Referential databases
  • Programming specialists

Today, cloud contact center solutions like Twilio's Programmable Voice API(link takes you to an external page) come integrated with IVR, combining decoded DTMF tones and web application logic to help you build your call center's menu in a snap.
Our Voice API(link takes you to an external page) builds custom IVR systems without specialized hardware. For example, you can integrate custom data sources and business processes into your IVR using flexible API tools, helping you weave context into every customer interaction and deliver a tailored, transformative experience to each customer.
Visit our IVR solution page(link takes you to an external page) and see how to create a cloud-based IVR to route callers and intelligently craft the seamless experience your customers want.

How interactive voice response benefits your organization

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IVR systems can scale contact centers without requiring agents to answer calls. The technology enables intelligent, segmented call routing for a richer context and a faster resolution, which 90% of consumers(link takes you to an external page) rate as important or very important when it comes to handling a customer support issue.

Moreover, IVR systems also supply general and account-specific information to callers, freeing representatives to handle more complex inquiries—automated IVR systems are especially beneficial for organizations with high call volume. Plus, customers can find quick answers to simple questions and perform basic tasks themselves, such as paying bills, making reservations, and tracking orders.

Helping customers help themselves can reduce transfers and prevent delays, paving the way to customer satisfaction. When your IVR software is up-to-date and runs smoothly, customers are less likely to get frustrated and demand to speak to an agent. In other words, better experiences benefit your call center as a whole and increase profitability.

Manage call flow and elevate service with Twilio IVR

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Contrary to popular belief, IVR is no longer reserved for large corporations or enterprises with big call centers. Small and medium-sized businesses benefit greatly from the lower costs, decreased staff workload, and improved customer service.

Learn more about interactive voice response with these resources:

For expertly managed call flow and superior customer service, set up IVR(link takes you to an external page) with Twilio today. We help clients create IVR systems that provide stress-free, user-friendly call experiences.

Interested in customization? Or need to modernize your outdated IVR system? Talk through your use case with Sales for IVR expertise you can lean on. We can't wait to see what you build with IVR for your business.

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