The risk of customer backlash dictates using caution when offshoring customer care.
Posted Nov 15, 2004
In response to customer criticism, Dell and Delta Airlines recently brought their offshore customer care operations back to the United States. This could signal a larger change. Recent research indicates the potential for backlash by consumers when companies use offshore contact centers to provide customer service and technical support.
One report raising concerns is "The American Consumer Reacts to the Call Center Experience and the Offshoring of Service Calls," conducted by BenchmarkPortal on behalf of Purdue University's Center for Customer-Driven Quality and staffing firm Kelly Services.
Among the findings, 65 percent of respondents say they would likely decrease or discontinue their interaction with a company that had outsourced its customer service call center operation overseas, with 48 percent citing nationalism for their reason. Younger respondents are less likely to react negatively.
Dr. Jon Anton, director of Purdue's Center for Customer-Driven Quality, says that many respondents "had not actually talked to a foreign agent," and that "the initial reaction is the classic 'buy American' attitude."
But according to the study more than 85 percent of respondents feel their most recent call center experience met or exceeded their expectations. So is it really a risk to take customer care offshore? "You need to listen to what they are saying. Even trying to replace five or ten percent of your customer base is going to be five times as hard [as] retention," says Elio Evangelista, senior analyst, Cutting Edge Information.
Numerous industry experts agree that the best course of action is to locate contacts where they meet both the customers' and the company's needs. "Not all inbound customer service calls are prime targets for offshore handling," Anton says. Amit Shankardass, senior vice president of solution planning for ClientLogic, adds that one must "choose the right shore for the right reasons."
In fact, according to Mark Best, associate analyst for Datamonitor, the potential for backlash depends "on the
The biggest risk, according to Chris Selland, vice president of sell-side research for Aberdeen Group, is how some customers perceive offshoring, as "they don't care about me." Shankardass adds that, "Some consumers just have raw emotion against a foreign accent."
"This is a real risk and an unfortunate one," Selland says, adding that the potential for backlash will fade "once the noise dies down."
However, Best points out that there is not a mass migration to outsourcing customer care offshore. "It does get blown out of proportion. There are 4.05 million agent positions across the world. Only 81,000 are outsourced offshore agent positions. Through 2007 that will only grow to 232,000 agent positions worldwide out of 4.78 million agent positions."
For Anton, "The overall message is simply that cheap can be expensive when it comes to offshore outsourcing. But, if done properly, it is an option worth exploring and implementing with caution."
A SINGLE VIEW OF THE CUSTOMER IS STILL LACKING
How many discrete applications are your agents required to access on their desktops to handle customer inquiries?
more than 10----7.4%
Source: CRM magazine/PeopleSoft Web seminar, "How Usability Helps to Drive a Profitable Contact Center"
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