Why it is Important to Track Your Cost-per-Touch

Hello, everyone, and welcome to another volley rally. Today I'm joined by Alex Martinson from the volley team. Alex, first time being on one of these. How's it going?

It's going great, Jake. Glad to have the opportunity. And as we know, we mix business and pleasure here with volley, so it's good to see you and great to be on one of these.

Absolutely. And what are we going to be talking about today with everyone?

Really? There's a lot of different metrics that are important to auto dealers when it comes to their business development center or their bdc. I really wanted to talk about cost per touch, you know, and kind of dive into why that's important.

And to be clear, this stuff is important whether you're using desk phones or you're using Volley. But obviously volley will help you to track some of these things, give some automation to the reporting and such. But we did want to bring Alex on. He and I were talking about this last week, and he has some really interesting things to share. So with that said, what is cost per touch and why should we be measuring this?

Yeah, I mean, that's a great question.

Really.

Business development centers, or BDCs as we call them, have really come into their own in the last 10 years. They are a driving force for growth and keeping your customers coming back. Right. We always talk about customer retention, but there's a tough question, and it's, does my BDC make me money or cost me money?

Right.

And that's why we really need to look at how we manage our BDC agents and how we measure their efficiency. And it's not like it used to be.

Right.

I mean, over the last decade, you know, reaching out to customers has become a bit of a jigsaw puzzle. We're calling, we're texting, we're emailing, some combination of the three. For this conversation, I wanted to hone in on phone calls. So we all have our ways of keeping track of things. But one metric that I've found is particularly useful is, like I said, cost per touch. And what that boils down to is what it costs for a BDC agent to pick up the phone for an inbound call or make an outbound call. And believe me, it's an eye opener, you know, when it comes to efficiency and more importantly, profitability of your bdc.

So in your mind, you're looking at this and measuring this as a, okay, am I making money or losing money with the bdc? You know, kind of. That's how you're thinking about it.

I like to think about, you know, your agents and their and their productivity. Your BDC agents are essentially your most valuable and expensive asset in the bdc. So why not optimize what they're doing?

And so with that said, if BDC agent productivity is such an important thing, how do you measure that? And how do you then measure your cost per touch?

Cool. So let's break it down the first. We have to estimate the cost of a BDC agent, and we're not just talking about their salary. You know, there are bonuses and benefits to consider. Usually you're looking at around $3,500 a month in total. And that's the number that we'll use for our cost per touch calculation for a full time BDC agent. So here's where it gets interesting. Let's say, you know, you don't have any fancy technology solutions like Volley to help you out. You could be dialing through a desk phone. Click to call. An agent typically can handle around 75 customer touches each day. We found anywhere from 60 to 68 to 80 is kind of our average. So let's just use the ballpark figure of 75 customer touches per day per agent. Okay, let's say because the full time agent is working roughly 22 days in a month, that works out to a daily cost of around $159 and some change per BDC agent. Right. Per day. And if you consider 75 customer touches out of that $159 you're spending a day, it comes down to a cost per touch of $2.12. So that's kind of our starting point in an average cost per touch for many dealerships.

And what then does Volley help you do as a dealer? In the context of cost per touch.

Volley helps with many things. But in the context of cost per touch, let's throw some tech into the mix. With a blended dialer like Volley, an agent can manage 70 inbound calls and still average about 160 outbound calls per day. So if you think about that from a total touch standpoint, it's around 230 customers that that BDC agent should have an interaction with or an activity with each day. So that would bring your cost per touch down to about 69 cents. Here's the cherry on top, right? If an agent is zeroed in on outbound dialing, right. Because that inbound side of things is a totally separate variable. It's going to depend how many customer touches a day they can make by how many inbound calls they're having to Manage. If that agent is solely focused on outbound touches through Volley, our gold standard is 300 customers each day, right. That actually brings your cost per touch down to only 53 cents. So that's something to consider. And of course, you know, there are other costs when running a bdc. There's management costs, there's equipment, there's training, there's other software subscriptions that you might have. But really, when it comes down to your most expensive asset, you know, your people, this is a great way to measure your cost efficiency in the BDC to keep things balanced.

A lot of great information there. And like we said at the top here, these are things that we want you to be able to and really want you to think about. Even if you're not using Volley, it's great to think about how many dials are we making? What does that actually cost me per attempt? As Alex outlined with the math there, if you're hitting about 75 customers, you're over $2 per attempt. Right? So, you know, one of the neat things that we're trying to do here with Volley is to really help you guys out and automate a lot of those tasks. And if we can bring those costs per attempt down. You said 53 cents, is that what you said?

On the outbound side? Yes. But even when you're managing inbound, you know, we can get you close to that, that 70 cent per customer touch marker. And here, here's the big picture, Jake. You know, I mean, there's lots of things that you should be measuring in your bdc, but shaving down the cost per touch can skyrocket profitability for your bdc. We want to be able to tie those BDC efforts back to dollars and cents in the dealership. And more touches means more chances to book appointments, close deals and increase your revenue.

And ultimately, just having something to benchmark toward is going to go a long way towards helping you improve the efficiency of your BDCs. Thank you for, for joining us and sharing those stats with us. That lot of great information here. And if any of you listening have any other questions or thoughts about this, feel free to reach out to your Volley Rep and, and we can go ahead and walk you through how you can, how we can help you hit some of those, some of those goals. Alex, any other closing thoughts here?

No, Jake, we just want to be able to help people with their BDCs. We know that they're working hard. And any way that we can help you measure or manage those crucial things in your bdc, let us know.

Awesome. Thanks, everyone, and have a fantastic day.

Thanks.