Rules and Compliance for Predictive Dialing in the US
There are three fundamental rules of predictive dialing compliance in the US. We will examine each of these aspects closely and offer recommendations.
Predictive dialers enhance agent talk time per hour by dialing multiple lines simultaneously (a practice known as ‘over dialing’) when an agent becomes available. To curb the nuisance calls generated by over dialing, regulations were introduced in the US. We firmly believe that these rules are designed to achieve precisely that. It’s evident that inundating customers with a high volume of nuisance calls, regardless of the industry, can turn them into adversaries rather than fostering positive relationships.
Opting for full compliance and showcasing this commitment is highly beneficial for an organization’s market perception.
However, dialer designs can vary significantly. Some are quite basic, with over dialing controls that a supervisor can manually adjust. On the other end of the spectrum is a dialer engine like the Virtual Event Machine (VEM®) offered by the AI Dialer™. VEM® utilizes highly automated AI procedures to generate the best possible dialing outcomes while adhering to FTC/FCC rules governing predictive dialer use.
What are the US rules for predictive dialers?
Early hangups – Before a caller is allowed to hang up, each dialed number must ring for at least 15 seconds.
Abandoned calls – The measure for abandoned calls should not exceed 3% of live calls, and this measure is calculated as follows:
Abandoned calls / (Abandoned calls + Live calls)
Live customers held in queue – Once a call is connected, the phone goes off hook, and the customer starts speaking, the call should be held in the queue for no more than two seconds after the end of the customer greeting. Please note that this is in accordance with the FTC (Federal Trade Commission) rule.
Early hangups
Going back to the 90s and the early part of this century, it could take up to ten seconds to reach a called party due to latency and delay issues. During this time, you could cancel a call before it started ringing, thus not causing a nuisance. This was done if the agent(s) suddenly got another live call(s). However, in today’s context, with modern dialers and networks, you are ringing the called party’s home in about a second or two. Therefore, if you abort a call early, before the called party can reach the phone, it becomes a nuisance call.
The potential for any productivity gain by aborting calls early is extremely small, and there’s a high chance that you are actually hanging up on a number that is already ringing. Regulators have generally ruled out this practice with little discussion because it can be extremely upsetting to customers.
Some years ago, the US Direct Marketing Association published its own code of practice and decided that a 12-second cutoff was reasonable. This was later changed to 15 seconds by the FTC (Federal Trade Commission) in 2002. In today’s markets, especially for calls to cell phones, there might be a case for the industry to suggest going back to a lower cutoff time, but we are not aware of any significant pressure to do so.
Our recommendation is that the 15-second rule, as stipulated by the FTC (Federal Trade Commission), should be observed.
Abandoned calls
The practice of using the “all calls” measure, which calculates abandoned calls as (abandoned calls plus aborts) divided by completed dials, has been rejected by all regulators. Some vendors may still encourage its use because it allows for a higher over dial rate. However, it comes at the cost of a significantly higher abandoned call rate, especially in campaigns with a low live call rate. For example, if a campaign has a 20% live call rate and an “all calls” measure of 3%, it translates into a 15% abandoned call rate when the “live call” measure is used.
This issue has been a topic of discussion over the years, and it’s surprising that some vendors still promote the “all calls” measure, especially when regulators have rejected it.
Our recommendation is to use the “live calls” measure for calculating abandoned calls, as it aligns with regulatory guidelines
Live customers held in queue
Non-compliance with this rule is a significant factor contributing to nuisance calls in contact centers that use predictive dialing. The rule is designed to minimize nuisance by promptly notifying the customer if an agent is not available and offering to call them back later with an agent ready to assist them. However, some contact centers do not follow this practice and instead subject customers to extended periods of silence or play a message asking them to hold.
This approach is not only considered bad practice but also goes against the interests of contact centers. Research has shown that customers often wait longer than expected when they receive a silent call, despite conventional wisdom suggesting that people would hang up quickly. In a test conducted, the average hang-up time was 13 seconds, indicating that customers genuinely want to know the purpose of the call and are willing to wait briefly. However, customers listening to dead air or generic messages become increasingly unhappy, leading to a negative customer experience and potential privacy intrusion.
In summary, keeping customers waiting on the line without a clear explanation or immediate assistance is detrimental to both customer satisfaction and the quality of the call. Compliance with regulations that aim to prevent this practice is essential for maintaining positive customer interactions and avoiding the creation of nuisance calls.
We recommend adhering to the FTC call abandonment provision, which stipulates a maximum of two seconds following the conclusion of the customer greeting before ending the call.
Is it possible for dialers to maintain productive dialing while adhering to compliance regulations in today's markets?
In many contemporary markets, outbound campaigns often experience significantly lower live call rates compared to what was typical a decade ago. Paradoxically, this situation implies that the potential benefits of predictive dialers have increased substantially.
The true measure, and the only measure, of a dialer’s performance is its predictive gain under compliance. This refers to the increase in talk time per hour when transitioning from progressive to predictive dialing.
While compliance regulations make sense in terms of avoiding nuisance calls, there hasn’t been much serious analysis regarding whether dialers can effectively operate within compliance guidelines. In the US, the dialer industry had limited involvement in discussions with regulators about setting reasonable levels for abandoned calls, for example. As a result, regulators have often erred on the side of caution and set stringent standards for abandoned calls, and the industry has largely supported compliance rules.
It’s frustrating because the reality in this field sometimes seems detached from the actual situation. DataTel is one of the very few companies offering a dialer explicitly designed to deliver good performance within compliance guidelines. This is crucial because if a dialer wasn’t built with compliance in mind, the only way to achieve good performance is to dial outside of compliance.
The key message is that US organizations can expect to dial within compliance using the AI Dialer™ and still achieve good results. This means minimizing nuisance calls while keeping abandoned calls to a minimum. There’s no need to abort calls early or keep customers waiting in hold queues. Beyond compliance, these actions simply upset customers.
Are there compliance exceptions?
The occurrence of abandoned calls should be limited, and it’s especially relevant in cases such as debt collections for very old debts where the live call rate can be extremely low, typically between one and five percent. However, in most US collections operations, campaigns often have a minimum live call rate of around 10% with a reasonable number of agents (e.g., 20 or more). With an abandoned call target set at just 3% of live calls, the AI Dialer can achieve good predictive gain, and this gain tends to improve as live call rates and agent numbers increase.
However, we acknowledge that in regions where compliance regulations are absent, and live call rates are exceptionally low, there might be a case for setting a higher abandoned call target beyond 3%. Nevertheless, such cases are relatively rare. We typically collaborate with users to start with a 3% abandoned call target, and if results prove unsatisfactory (which is unlikely in most cases), they may consider moving to a higher target, often around 10%, still measured as a percentage of live calls.
Putting the AI Dialer to the test
To get started with testing the AI Dialer or exploring its capabilities further, you have several options:
Installation and Trial:
- You can install our dialer software and run a trial campaign. This allows you to experience its features and performance firsthand. We offer support during this trial period.
Comparative Testing (Bake-Off):
- If you want to directly compare our dialer with other solutions, you can organize a competitive test or “bake-off.” This involves running campaigns using different dialers simultaneously to evaluate their performance side by side.
User Feedback:
- Reach out to current users of the AI Dialer. They can provide valuable insights into their experiences with the dialer, its compliance capabilities, and its impact on their operations.
To initiate any of these options, you can contact us directly. They will guide you through the process and provide the necessary support to ensure you can thoroughly assess the dialer’s performance, compliance features, and suitability for your specific requirements.