You know the drill: dial a customer service number and prepare to wait as the automated message begins: “We are currently assisting other customers. Your call will be answered in the order it was received. ” Recorded delay announcements such as these are nothing new, but their strategic use is proving to be a surprisingly complex game played between customers and service providers.

Gad Allon, Achal Bassamboo (Associate Professors of Managerial Economics and Decision Sciences at the Kellogg School of Management), and Itai Gurvich (Assistant Professor of Managerial Economics and Decision Sciences at the Kellogg School of Management) are interested in how delay announcements can be used most efficiently at both ends of the phone line—by service providers and customers alike. Their theoretical research shows that strategic use of wait messages can ultimately improve firm profits and utility to customers.

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Publication/Copyright: Kellogg Insight