• February 4, 2005
  • By Coreen Bailor, (former) Associate Editor, CRM Magazine

Consumer Purchasing Decisions: Outsourcing Is Not a Factor

According to a recent study by Jupiter Research, outsourcing has minimal impact on consumers' purchasing behaviors. Of the 2,535 consumers surveyed for "Contact Center Outsourcing: Understanding Customer Perceptions," a mere 16 percent responded that outsourcing customer service functions affected their decision to purchase from a particular Web site. Fifty-seven percent of consumers said that the efficiency of service resolution effected their decision to purchase from a company. "While there is a small percentage of consumers that indicated sensitivity to outsource customer service," says Zachary McGeary, research associate and lead analyst of the report, "what customers really want is just the most efficient, effective, available service possible." The study also suggests that companies that do choose to outsource often choose a mixed-bag approach. Of the 252 executives at companies who outsource their contact center operations, have customer-facing Web sites, and more than $50 million in annual revenue, 60 percent of the companies that admitted to outsourcing also keep certain operations in-house. "Essentially, U.S. firms had thrown all of their eggs in one basket with one vendor, and when the relationship didn't work out and they wanted to pull out, they had incurred the costs of establishing that relationship and incurred the costs of bringing those operations back in-house," McGeary says. "[But] there are a number of companies that outsource just a portion of their contact center service, keeping perhaps the most important processes close to home where they have control over it and sending perhaps the most cost-effective contact center operations overseas or just simply outsourcing it to another company." The study also explores other low-cost outsourcing options, such as offshoring, that based on a company's need may be more appropriate. Offshoring is synonymous with India, but more hotbeds are emerging in regions like Latin America and the Philippines. Another low-cost option that is gaining momentum is outsourcing domestically via home agents. "There are plenty of other options within the U.S. and in fact, most companies that outsource do so onshore," McGeary says. According to the study, 84 percent of companies that outsource their contact operations do so domestically, and of those 45 percent also outsource offshore. "If you do have certain elements of your business that are more culturally sensitive," McGeary says, "then you have this option to outsource onshore, and a lot of companies are jumping on that bandwagon." Related articles: BPO: Cost Takes a Back Seat
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