73% of business leaders rely on data to make better decisions. This statistic highlights the importance of data-driven insights, especially when calculating ROI (Return on Investment) for advanced technologies like AI-powered knowledge engines. Understanding the impact of data-driven decision-making is crucial, as ROI measures the profit gained from an investment compared to its cost.
But what exactly is ROI? It measures the profit gained from an investment compared to its cost. In simple terms, ROI calculation helps you understand whether your investment delivers value.
However, calculating ROI with AI knowledge engines can be challenging due to their unique nature. These systems offer intangible benefits and complex cost structures, making traditional calculations insufficient. However, there are common challenges like intangible benefits, complex cost structures and long-term value realization.
Why do companies invest in AI-powered knowledge engines? The answer is simple: these tools improve personalized customer experiences with the answer engine and streamline operations. Let's break it down:
This blog will guide you through ROI calculation for AI knowledge engines. Continue reading!
To measure the ROI of your AI engine, you first need to grasp the key metrics that matter. According to a study by McKinsey, companies that embrace AI can expect to increase their productivity by 40% over the next decade.
So, what should you keep an eye on? Here's a breakdown:
Here's how to evaluate the ROI for your AI-powered knowledge engine:
Step 1: Establish Baseline Costs
Measure the cost of handling customer requests, considering staff salary and infrastructure. For example, if your 10-person support team costs $100,000 annually, this is the base cost
Step 2: Track Improvements Post-Implementation
Measure the changes after deploying AI - time saved, staffing reductions, and increased FCR. For instance, if your AI reduces query resolution time by 20%, note that improvement.
Step 3: Estimate Revenue Impact
Boosting customer satisfaction can drive more sales. For example, if your CSAT goes up by 5%, it might result in a 3% increase in sales, giving you a precise revenue figure to calculate.
Step 4: Calculate Total Savings
Combine your reduced support costs and added revenue to calculate your ROI. If you reduce your operational costs by $30,000 while increasing your revenue by $10,000, you will save $40,000.
Forget the endless, frustrating FAQs! Splore AI Answer Engine is your go-to expert for customer support. It provides instant, accurate information to customers, employees, and developers alike. Splore reduces the burden on support teams and improves efficiency by automating responses to repetitive queries.
Here's how you can calculate savings with Splore:
Step 1: Annual Customer Support Ticket Costs
Begin by identifying your yearly costs for managing customer support tickets. For example, if your company spends $100,000 on handling tickets annually, this figure helps calculate potential savings with Splore.
Step 2: Average Ticket Costs
Calculate the average cost per support ticket. For instance, if it costs you $10 to handle a ticket, you can project how many tickets could be automated.
Step 3: Number of Support Tickets
Determine how many tickets you receive each year. If your business processes 10,000 tickets annually, the ROI calculator can help estimate the number of queries Splore could resolve autonomously.
Step 4: Average Handle Time
Record the average time it takes to resolve each ticket. If each ticket takes 15 minutes to handle, and AI cuts that by 50%, you can immediately see time savings.
Step 5: Current Customer Satisfaction Score (CSAT/NPS)
Measure your existing customer satisfaction rate, which might be 80%. AI could boost this figure by reducing response time and providing more accurate answers.
Step 6: Percentage of Repeat Queries
Estimate the number of repetitive queries in your tickets. If 40% of your tickets are repeating questions, Splore can handle them, reducing the need for human intervention.
Step 7: Customer Lifetime Value
Calculate the revenue a typical customer brings over their lifetime. If each customer is worth $1,000, improved satisfaction can directly influence the number of customers who stay longer.
Step 8: Customer Churn Rate
Record your churn rate, say 15%, and assess how Splore's enhanced support could lower this figure, directly impacting your revenue growth.
After completing these fields, you can calculate your potential savings with Splore's ROI Calculator. Enter your data, including your name and email address, and let the ROI calculator handle the rest.
Here are three key benefits of Splore ROI calculation:
Calculating the ROI of AI-powered knowledge engines can lead to better decisions and increased efficiency. Businesses may ensure that their data-backed investments generate long-term advantages by measuring the ROI of these solutions. Splore ROI calculator allows you to easily assess the value your AI-powered knowledge engine brings to your business.
Want to see how it works for you? Calculate your ROI now using Splore's Knowledge Base ROI Calculator!
To determine ROI, compare the income and cost savings generated by the AI technology with the initial capital investment. This includes tracking measures like time savings, reduced staffing, and increased customer satisfaction.
A return on investment of 20-30% is generally reasonable. However, this may differ based on your sector and business objectives.
An ROI calculator is a tool for estimating the profit or loss of an investment by comparing costs and savings. Its purpose is to make ROI calculations easier.
Calculating ROI helps businesses understand whether their knowledge engine is worth the investment by measuring cost savings and improved customer outcomes.