Don’t Call Us, We’ll Call You: An Empirical Study of Caller Behavior Under a Callback Option

Abstract

Although call centers have recently invested in callback technology, the effects of this innovation on call center performance are not clearly understood. In this paper, we take a data-driven approach to quantify the operational impact of offering callbacks under a variety of callback policies. To achieve this goal, we formulate a structural model of the caller decision-making process under a callback option and impute their underlying preferences from data. Our model estimates shed light on caller preferences under a callback option. We find that callers experience three to six times less discomfort per unit of time while waiting for callbacks than while waiting in queue, suggesting that offering callbacks can increase service quality by channeling callers to an alternative service channel where they experience less discomfort while waiting. However, after controlling for expected waiting times, callers generally prefer waiting in a queue over accepting a callback and waiting offline. This suggests that managers of this call center may want to spend efforts in educating their customers on the benefits of the callback option. Using the callers’ imputed preferences, we are able to conduct counterfactual analyses of how various callback policies affect the performance of this call center. We find that in this call center, offering to hold the callers’ spot in line or to call back within a window (guaranteed timeframe) reduces average online waiting time (the average time callers wait on the phone) by up to 71% and improves service quality by decreasing callers’ average incurred waiting cost by up to 46%. Moreover, we find that offering callbacks as a demand postponement strategy during periods of temporary congestion reduces average online waiting time by up to 86%, increases service quality by up to 54%, and increases system throughput by up to 2.1%. This paper was accepted by Vishal Gaur, operations management.