If you were to ask many business executives, they would say their customer service contact center is a necessary expense that does not contribute to the bottom line.

As such, they don’t emphasize technology upgrades or process improvements for in-house centers and, when outsourcing, settle for the least expensive options. Worse, some companies are cutting their contact centers altogether, considering them less relevant in this age of digital self-service.

But what if you could turn your customer service contact center from cost to profit? In fact, what if it could become one of the largest revenue generators in the entire company?

Now that I have your attention, let’s discuss why investing in your contact center to turn a profit makes sense and the steps you can take to get there.

Reasons to Invest in Contact Center Improvement

The reasons to invest go beyond the contact center as an expense. Poor customer service is costing businesses more than $75 billion a year, according to a report from NewVoiceMedia.

The same report showed that when faced with poor service, 39 percent of customers would never use the offending company again, and 37 percent would change suppliers. It also noted that 67 percent of consumers are “serial switchers” — consumers who are willing to switch products or services due to poor customer service.

The 2018 Customer Service Expectations Survey from Gladly, a customer service software provider, found that of nearly 1,000 consumers polled, 92 percent would stop purchasing from a company after three or fewer poor customer service experiences and 26 would stop after just one bad experience.

In an increasingly competitive global marketplace where the margins between price and profit are thinner than ever and consumers are expecting delivery on brand promises now more than ever, your customer service can be the difference between profit and loss.

How to Turn the Contact Center from Cost to Profit

Take the following steps to turn your contact center to a profit center.

1. Understand Customer Wants

A whitepaper from West Monroe Partners — Turning the Contact Center Into a Profit Center in the Digital Age — says, “Understanding what your customers want is the first step to elevating the customer’s voice within your organization.” It advises that contact centers use feedback mechanisms, such as post-resolution phone surveys, email surveys, and, when possible, in-person conversations.

“Customers must be asked and their responses benchmarked consistently and continually to turn your contact center into a profit center,” the whitepaper says.

2. Offer Additional Channels

Today’s consumer values speed, so in addition to traditional phone and email, adding support channels like chatbots, live chat, social media, and mobile apps is no longer a luxury but a necessity. Make it easy for the customer to get in touch with you using whatever means is best suited to their preference.

3. Invest in Agent Success

An overwhelming majority of those surveyed for the NewVoiceMedia report — 86 percent — said that if they felt they’d made a positive emotional connection with a customer service agent, they’d be more likely to do business with that company again.

That’s reason enough to make a sound investment in your recruiting, hiring, and training processes and then providing agents with a clear career path, celebrating their successes along the way.

I said in a previous blog post that agent development starts with knowledge — understanding the client’s brand, industry, products, and processes, and the only way to attain that knowledge is through education — teaching agents how the business works so they can find an answer and provide the solution.

Well-trained agents who have the skills necessary to satisfy the customer is certainly one key to success.

4. Turn Service Calls into Sales Opportunities

Another way to turn the contact center from cost to profit is by training customer service agents to make relevant offers to customers when appropriate. Even though selling is not the primary role of customer service, that does not mean agents can’t learn the art of the soft sell.

Train your agents to get to the heart of the customer’s challenge, steer the conversation around cross-sell and upsell opportunities, and invite the customer to take advantage of the product or service opportunity being presented.

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5. Find Ways to Improve CSAT

It stands to reason that the more satisfied the customer, the higher the CSAT score, and the more profitable the business. Just a five percent lift in customer retention can boost a company’s profitability by as much as 75 percent, according to Bain & Company.

The key, then, is to find ways to improve the score. How to go about it is the question, of course. I recommend the following:

• Conduct a thorough review and evaluation of current CSAT scores, agent training, the customer journey, call flow, and other aspects of the call center’s operations;
• Implement this formula: competency + courtesy + speed = better customer satisfaction.

Contact centers that place the proper emphasis on improving CSAT can transform from a cost center, merely responsible for cost control, to a value center that actively drives revenue.

(Read my article at Nearshore Americas — How to Improve Contact Center CSAT Scores and Rake in The ROI — for more on this subject.)

6. Keep Customer Experience Excellence Consistent

John Larson, a senior partner at John Larson & Company,  a consulting firm, in an article for CustomerThink, said that consistency in customer experience excellence is the key to loyalty.

“When I speak with a client’s truly loyal customers, I find they are completely confident that every time they deal with our client they will have a great experience, and — in those rare cases when they do not — they have absolutely no doubt the company will take whatever steps are necessary to immediately rectify the situation,” he says.

Larson also says that when he speaks with customers who do not consider themselves loyal, the reason is inconsistency. Sometimes the customer has a good experience and other times they do not.

These conversations with customers highlight a crucial point, according to Larson, that loyalty does not come by “delighting” customers or “exceeding their expectations.” Instead, it comes by delivering excellent service consistently.

7. Increase Customer and Staff Retention

It’s a common understanding that it costs up to five times more to find a new customer than keep the ones you have. The same is true of staff. It’s more expensive to recruit, hire, and train new agents than it is to keep your best players.

New agents less familiar with your products and services can adversely affect productivity, CSAT, and other meaningful metrics, which costs you more.

8. Reduce Labor Costs

The most expensive part of running a contact center isn’t technology or infrastructure, it’s labor  — as much as 70 percent, according to NICE inContact, a contact center software provider.

With unemployment in the U.S. at historic lows, staffing contact center jobs has become much harder, which drives up costs even further. The minimum wage in many domestic centers is now $15 per hour.

One way to curb rising costs is to outsource to vendors that specialize in customer service.

Just by moving your contact center offshore doesn’t mean you will save money, of course. Many companies that have transitioned operations abroad have found themselves faced with poor quality service, loss of revenue, and rising concerns over security measures.

That’s why, when you consider outsourcing, you should look for the following:

Location
Going “offshore” typically means outsourcing to India or the Philippines. But then you’re faced with vast time zone differences, long flight times, and a lack of understanding of U.S. culture.

Outsourcing nearshore, a popular option, allows you to do business in the same (or similar) time zones, greatly reduces travel times, and makes for a much stronger cultural fit.

Quality
The need to ensure quality service should always outweigh the desire to save on costs. A common perception with outsourcing, however, is that the lower price point also means lower quality. That is not always the case.

The best way to know is to see the numbers, including metrics such as CSAT, AHT, FCR, and others. If the vendor is unwilling to share those, walk away. The chances are you won’t fare any better once you partner with them.

Culture
Finding the right DNA (i.e., business culture) match between a company and an outsourcer is the most important aspect of any successful outsourcing relationship. That’s why you should choose an outsourcer whose cultures matches your company’s values. Make that choice first, and the rest will fall into place.

Size
Small, large, which is better in an outsourcer?

Finding smaller vendors may be harder due to their less visible presence in the marketplace, but they may offer more customized services than large BPOs that have more rigid processes.

It may require more research and discovery to find the right fit — and one size does not fit all — but providing your customer with a better experience is worth the effort.

(Many other factors go into choosing an outsourced provider. You can see the full list here.)

Conclusion

In an era when customer experience is the make or break criteria for business success, not investing in your customer service contact center is a big mistake. If maintaining a center in-house is no longer feasible due to the low unemployment, higher wages, and the inability to scale, choosing to outsource can be a viable option.

Don’t select an outsourcer based on cost alone, however. Price is a critical metric, but the ultimate goal should be to provide high-quality service that reflects the value of the investment.

If outsourcing is an option, consider Transparent BPO. We provide customized solutions, experienced leadership, and an open model lets you see exactly how your contact center is working at all times. Contact us to learn more.

Written by Scott Newman, CEO, Transparent BPO