Customer Service

What is First Contact Resolution? 6 Best Practices to Transform Customer Interactions

Nouran Smogluk

May 28, 2024

As an agent, the ideal customer interaction probably looks something like this:

You pick up a call from a frustrated customer who recently purchased a device but is struggling to set it up. As they explain their issue, you quickly realize they overlooked a crucial step and know exactly how to solve the problem.

They walk away happy and grateful. You feel accomplished and fulfilled, knowing the job was well done. 

This is what First Contact Resolution is about.

What is First Contact Resolution (FCR)? 

First Contact Resolution (also known as First Call Resolution) is the percentage of customer inquiries that are resolved in the initial contact. 

It’s a metric used extensively in call centers and customer service to measure how well a company can address and resolve a customer’s concern or question during their first interaction, whether it’s through a phone call, email, chat, or any other communication channel.

FCR is not a metric that you can work with in isolation–it’s heavily impacted by many other metrics. 

An extremely high FCR rate doesn’t necessarily mean that customers are having an optimal customer experience. 

• In conjunction with a high contact rate, it indicates that there’s a ton of opportunity to improve your self-service. 
• High FCR combined with low Customer Satisfaction (CSAT) suggests that customer issues aren’t actually get resolved, but customers drop out of the interaction out of frustration. 

That said, FCR still provides an extra dimension to understanding the quality of your customer experience–and it can give you insights that no other metric does. More often than not, FCR correlates with higher CSAT and faster resolution times. 

⭐️ Recommended: Review the top customer service metrics

Why does First Contact Resolution matter?

Achieving first contact resolution means that the customer’s needs are met promptly and completely without the need for follow-up contacts or escalations. 

That leads to:

• Higher customer satisfaction. FCR dramatically reduces the amount of effort a customer needs to expend to ensure their concern is addressed effectively. It also makes customers feel more valued and reduces the amount of time they might feel blocked by an issue.
• More customer loyalty. Everyone’s had that one support experience where you had to repeat yourself three times until the agent finally understood the issue. And if that’s happening on email, each response might take days. That’s a customer that’s highly likely to churn. Prompt resolutions lead to the opposite.
• Cost efficiency. There’s a cost associated with every customer interaction and mot contact centers regualrly track Cost per Ticket or Cost per Call. A high FCR rate reduces the need for follow-up contacts, which lowers operational costs by minimizing the time spent on resolving each inquiry. 
• Higher agent productivity. Not only do agents need to spend less time on each interaction, there’s a sense of accomplishment created by solving issues quickly that improves morale over time, which will make the team a little more engaged. 

How to measure First Contact Resolution

The basic formulate to calculate the average FCR rate is very simpel:

 # issues solved in the first contact / # total no issues x 100 = First contact resolution rate (%)

In practice, measuring FCR is typically very easy via email because you can track the first agent response very easily. It can be a little more tricky on live channels like phone or chat support: Does it count as a resolution in the first call if the same customer calls the next day? If a customer is very happy about a chat interaction and decides to open the chat 10 minutes later to ask about a different issue, does that count as a resolution? 

Most companies typically define a cut-off point that essentially says: Customers rarely contact us after this amount of time about the same issue. Some contact centers invest more time calculating FCR and will consider the topic or type of query the customer had–so if customers reach out about different issues, that doesn’t influence how the first issue is counted.

As long as your methodology is consistent and makes sense in your business, it doesn’t really matter. Just keep in mind that there are different methods and that might influence industry benchmarks you look into. 

Industry benchmarks for First Contact Resolution

The industry standard for First Contact Resolution varies, unsurprisingly. While the range that’s typically thrown around is about 70 to 90%, very few companies seem to actually reach 90%. 

Zendesk, for example, reports that anything beyond 80% is considered “world-class.”

According to Fullview, industry averages break down to:

• Retail: 78%
• Insurance: 76%
• Energy: 71%
• Financial: 71%
• Technology: 65%
• Call Center: 71%

That suggests that 80% would be above average in most industries. In some, it would even be significantly above average. 

Significantly lower rates might be normal for businesses with technically complex products that require a lot of setup, but it’s probably still an indication that you should be focusing on this metric and trying to improve it. 

Best Practices to Improve First Contact Resolution

Deloitte reports that FCR is only used by about 29% of people as an indicator of customer satisfaction. 

Contact centers are more likely to work with it as an individual KPI to measure agent performance. Some variation of FCR is absolutely caused by how agents respond to the case, but investing in systems that optimize FCR over time will have knock-on effects on agent performance as well. 

Start by looking at the cases that rarely get resolved in one interaction and come up with strategies to tackle that particular case. The more systematic you are in your approach, the larger the impact you will have. 

The top strategies to improve FCR include:

• Developing a comprehensive knowledge base.
• Investing in a great Quality Assurance program.
• Practicing active listening to solve problems effectively. 
• Routing customer inquiries accurately.
• Integrating AI and automation tools. 

1. Develop a comprehensive knowledge base.

A comprehensive knowledge base can impact FCR in both directions:

• A great internal knowledge base should increase FCR, by providing agents with easy access to a wealth of up-to-date information. Well-organized tools with a great search like Tettra empower agents to efficiently diagnose issues and resolve them in that first contact. 
• Great external knowledge base content can actually decrease FCR by enabling self-service and increasing product knowledge. When it’s easier for your customers to solve the types of questions that can be answered in one interaction independently, you might see a decrease in contact rates instead. 

2. Invest in a Great Quality Assurance program

73% of customers say that friendly customer service reps create memorable customer experiences that make them stick with a brand.

These are the types of experiences that a QA program can unlock for your team:

• QA should improve how you handle complex customer issues, by ensuring there’s a higher level of agent knowledge across the team. 
• QA will help you identify patterns that lead to low FCR. For example, if customers always respond to your macro about an issue with the same one or two questions, there’s an obvious opportunity to adapt the response to address those preemptively.
• It can improve soft skills like empathy or active listening. By providing feedback and coaching on, it will enable agents to build rapport with customers, de-escalate tense situations, and create positive experiences even in challenging circumstances.
• You can use it to identify process gaps or inefficiencies that contribute to low FCR rates. For instance, if customers frequently encounter delays due to handoffs between departments, QA can pinpoint these bottlenecks and improve the customer journey. 

3. Practice active listening to solve problems effectively

Active listening is ultimately about reading between the lines and addressing the underlying customer concern.

For example, say a customer reaches out because they’re annoyed about the inability to hide their profile. The underlying concern here is a privacy one. Responding as if they’re asking for a feature request misses the point.

Another example could be a customer providing negative feedback about features that are great for engagement but can induce an element of stress, like gamification. Not addressing the potential emotional impact on the customer can give them the impression their concerns aren’t understood.

These are the issues that cause people to write again, and again, and again. 

Investing a little more in agent training and ensuring these types of cases are documented, so your agents know how to respond, can have a massive impact on FCR–and their experience. 

4. Route customer inquiries accurately

Another area that could lead to higher average handle times is routing. 

A lot FCR rate caused by routing highlights process inefficiencies in your system that should be easy to tackle–and that will lead to shorter response times. 

If it takes two or three interactions to even understand the customer’s conern well enough to route it to the right team, there’s a huge opportunity to improve your contact options and get more of that information upfront.

5. Integrate AI and automation tools

AI integrations with your service desk can provide another set of ways to improve FCR by:

• Providing instant access to information. AI-powered chatbots and knowledge bases enable customers to quickly access relevant information. They provide immediate responses to common inquiries and guide customers through troubleshooting steps, thereby reducing the need for human intervention.
• Predictive analytics to identify patterns. AI algorithms can analyze historical data to predict potential issues. AI helps support teams proactively address issues before they escalate, leading to quicker resolutions and higher FCR rates.
• Automated ticket routing. They can also solve some of the routing issues mentioned above, by intelligently routing tickets to the right agent based on factors like skillset, workload, or even past interactions. 

6. Create lasting impressions with every contact

Solving customer issues in the first interaction isn’t just about solving a problem–it’s about creating a lasting impression. 

Every interaction with a customer is an opportunity to build trust, loyalty, and satisfaction.

And delivering concise, personalized, and comprehensive help that addresses customer concerns right from the get-go sets up the entire customer relationship. 

Empowering your agents with the tools to deliver that type of experience is easier than it sounds. Tettra can help you onboard agents faster by centralizing your knowledge and helping you maintain it.

Get more action-packed tips on how to run a great customer service team from Tettra:

• The FAQs you need to know about customer service
• 19 customer service skills that every team should have
• Customer service tips for your business to be successful
• 13 customer service response examples for common Q’s
• Top tools list for 2024

How Tettra Can Help Your Customer Service Team

1. Efficient Information Access: Tettra’s AI-powered knowledge base and advanced search capabilities enable support teams to quickly find accurate information, reducing response times and improving overall customer satisfaction.
2. Streamlined Q&A Workflow: The Q&A feature in Tettra allows support teams to easily capture frequent customer questions and document comprehensive answers, enhancing the quality of support and reducing repetitive inquiries.
3. Integrated Knowledge Management: With integrations to platforms like Slack, MS Teams, Google Docs, and GitHub, Tettra ensures that support teams have seamless access to essential information and documentation, enabling more effective collaboration and knowledge sharing.
4. Content Verification and Expertise Utilization: Tettra’s content verification system, combined with the ability to designate “knowledge experts”, ensures that the information used by support teams is always accurate and up-to-date, thereby enhancing the reliability of support services.

Start your free trial of Tettra today.