“Finding the Balance: The Effect of Offshore Customer Contact on Profit and Brand”, a report published yesterday by industry analysts, ContactBabel, finds that UK companies are damaging brand and profit by their current use of offshore contact centres.
The report analysed a survey of 1,008 UK adults, carried out by ICM Research in February 2004, and finds that:
As an example, a typical UK High Street bank will save £9.26m per year in operating costs by replacing 1,000 UK agents with the same number in India. However, if only an extra 0.343% of customers defect in protest at this, the bank’s revenues will be reduced by the same amount. Last year, 1.09% of UK banking customers changed banks as a direct result of customer service offshoring.
Steve Morrell, principal analyst at ContactBabel, comments: “Offshore contact centres could have a valuable role in improving the service offered to UK customers. Through the flexibility of its highly-qualified and cost-effective labour pool, the offshore contact centre industry can help to solve issues that the UK industry has, such as finding staff for evening and weekend working, providing technical support, replying promptly to emails, reducing queuing times and increasing the service hours that a company can offer to its UK customers. Some survey respondents also complimented the offshore staff on their friendliness and speed to answer the phone.
“However, too many companies are using offshore contact centres in an unimaginative and cost-obsessed way which is alienating their customers and not playing to the potential strengths of offshore. Most of the UK public are not against
the concept of offshoring, and are prepared to give it a try. However, the experience has often been disappointing and has led to considerable numbers of customers defecting to UK-based competitors, which has made a definite and growing dent in profits – exactly the opposite to what these companies are trying to achieve through offshoring.
“Businesses should not look upon offshore as just a cheap alternative to what they are doing already in the UK. Some types of customer are as happy to call offshore as they are the UK. Others prefer to call offshore only if they have an urgent query and the UK contact centre is closed. Some only ever want to speak to UK agents.
“If UK businesses do not address the concerns of their customers, the level of customer defection will increase and their profits will decline further. Offshore contact centres certainly have a future role to play in providing service to UK customers, but they are a piece of the jigsaw, not the whole puzzle.”
A SUMMARY OF THIS REPORT IS AVAILABLE AT: