We've all heard the statistics that 50% of new businesses fail in the first year and around 90% of businesses fail in the first five years.
While most of these failures end in anonymity, there are those companies that burst on the scene and then cone to a resounding halt with equal amounts of fanfare.
So we looked at the "why" of some of history's famous business failures and we began to see common threads between what makes a company have to shutter it's doors and the components that make up a bad IVR and hosted IVR system.
# 1: Didn't understand what customer's desired.
THE COMPANY: Remember Flooz.com? Probably not. Why? Because they were an online company that tried to persuade internet users that online currency could and would work like frequent flier miles or gift cards. But the company did manage to burn through $50 million in the 30 months it was open. Flooz didn't understand that the customer and merchant didn't have a need or desire to have a unique currency to trade with. A credit card would do just fine.
A BAD IVR SYSTEM: Many companies create their IVR systems without asking their customers what is important to them when having to use IVR. If there's no mindful and customer-centric thought process while designing your IVR system, it is ininevitable your customers are going to experience unnecessary frustrations and bad experiences.
# 2: Alienated their customer base.
THE COMPANY: Commodore International (of Commodore 64 fame) was selling two million C64 computers a month and dominated the marketplace be selling almost half of all computers between 1980 and 1983. Atari, IBM and even Apple were fearful of and in the shadow of Commodore International. And then came the Commodore Plus/4 when was, in no way compatible with the wildly popular and established Commodore 64. Couple that with what one columnist stated in April 1981 that "the microcomputer industry abounds with horror stories describing the way Commodore treats its dealers and its customers" and you have an idea of why Commodore filed for bankruptcy in 1994.
A BAD IVR SYSTEM: Do your callers complain about the amount of menus and prompts they have to get through to finish the IVR process? Is your customer having a hard time getting to a live representative if the IVR can't help them? Does your customer have to enter their information and if they have to be transferred to a live agent...they have to give the same information again? If so, you are alienating your customers. One by one, one call at a time.
# 3: Didn't evolve with technology.
THE COMPANY: Polaroid. While everyone else began snapping digital photos, downloading them to our computers and then later, taking pictures with our tablets and phones, the executives at Polaroid Corporation were still taking and shaking their pictures right into Chapter 11 bankruptcy. The Polaroid name has sprung up again with a new digital (welcome to the game) camera, but the jury's out on if it can capture the magic the Polaroid name once had.
A BAD IVR SYSTEM: Technology has evolved. But the piece that's more critical, your customer has also evolved. And with that evolution comes heightened expectations. If your IVR technology doesn't allow the caller to feel "in control" of the whole self-service dynamic of the IVR process, your technology is out of date and your customer is out of patience.
# 4: Just because you have it, doesn't mean it's good.
THE COMPANY: Betamax was the first home video recording device for the masses so it had to be great...right? Well, take into consideration that it was bulky, complicated, ugly and expensive. Then add to that, it could only record up to an hour. And you wonder why VHS took over the market a year later?
A BAD IVR SYSTEM: If you're not monitoring and gathering statistics on your IVR system on a consistent basis...your competition is. Just because you have that bright and shiny new IVR and hosted IVR process in place, you cannot take it for granted. Monitoring live agents, tracking call statistics and gathering the thoughts and comments of your customers is vital to ensuring the customer is having a positive experience.
# 5: Customer's expectations not met.
THE COMPANY: Edsel. Okay, technically not the company failure but one of Ford's biggest marketing blunders of all time. Ford promised that the Edsel would be cutting edge in the auto industry. It even had it's own television special to unveil the car. Ford assured America that detailed market analysis, customer research and new design would guarantee the car's popularity, What America got was a care that was kind of homely, fuel thirsty and too expensive. In the three years Edsel was in production, Ford Motor Company lost $350 million, or the equivalent of $2.8 billion in 2014 dollars on the venture.
A BAD IVR SYSTEM: As mentioned earlier, today's consumer's expectations have increased with technology. Gone are the days when a caller's reaction to an IVR system was "Wow, this automated recording stuff is pretty neat.". Callers now expect a fast, easily maneuvered and seamless experience when completing an IVR process. Delivering to them anything less is a dagger to your customer's satisfaction and your company's reputation.
These five historical business failures and blunders and an IVR process that just doesn't work both have the same common thread in that they lose their customer's trust and emotional connection.