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Our essential guide to customer service support outsourcing

Nick Ogden
AUTHOR
Nick Ogden
    11 minute read

Customer service is one of the most important aspects of your business and can be the difference between making a sale or keeping a customer... and losing them forever. So what exactly is customer service?

Customer service is the support which you extend to your customers before, during and after they purchase your product or service.

According to Walker, now is the moment in time that we’re seeing customer experience overtake price and product as the key brand differentiator in the marketplace. What’s more, a customer is four times more likely to defect to a competitor if their problem is service-related rather than product-related. 

The face of customer service is also changing with the expectation that companies should be able to be contacted by customers 24/7 across any and every communication channel available. Resourcing this expanse of customer service expectations represents a huge cost to businesses which is why up to 54% of companies now outsource their customer care offshore.

What is customer service support outsourcing and why should your business consider it?

Choosing to outsource your customer support involves hiring a third party to manage customer service on your behalf. This covers all communication channels, including telephone and digital, and the team looking after your customers may be entirely dedicated to your business or working for a number of different businesses. As part of your decision to outsource offshore, be sure to investigate the options available in terms of dedicated versus shared resources. Each option will come at a cost, with shared resources being cheaper but likely to result in less satisfied customers versus dedicated agents who will cost more but are more likely to give better quality service.

If you’re considering outsourcing your customer service, you should first look closely at the reasons influencing your decision:

  1. Reducing costs

    An offshore customer service centre can reduce your employment costs by up to 70%. In most cases, these costs will include many overheads such as office and IT infrastructure as well as your staff wages and HR management. However, as we hinted at earlier while outsourcing customer service should reduce your costs, it shouldn’t come at the cost of quality service.

  2. Extending hours of service

    Customers now expect service at all hours of the day, if not 24/7, which can be difficult to manage via a single location. By offshoring your customer service, you’ll gain the advantage of time zone differences which can significantly extend your hours of operation.

  3. Expanding coverage

    Thinking of expanding overseas? Outsourcing your customer service can be the first step to going international. An offshore team gives you the expanded hours to handle multiple international locations as well as the potential to offer service in multiple languages.

  4. Focusing on core business

    Whatever you’re producing, developing and selling, this is your core business; it’s what you do best. Focusing on your core business is the best and most cost effective use of your time and the only way your business will continue to grow and generate revenue. Answering customer questions and solving their issues is therefore best left to a customer service team who have been trained in your business and product and have the specialist skills needed to deal with customers.

  5. Scaling your business

    Once you have an outsourced customer service team in place, you have the ability to scale your workforce according to demand. During busy times, you can increase the number of staff handling customer contacts, and when things quieten down, you can drop back to a minimum number. What’s more, offshore service providers are geared up to manage these fluctuations with efficient training methods and a wealth of available talent.

  6. Improving efficiency

    A dedicated customer service team will be focused entirely on looking after your customers. Outsourcing providers are set up with the infrastructure, technology and know-how to streamline customer service procedures. And without the distractions of other responsibilities, your customers will receive a fast and appropriate response.

     

What makes good customer service and how do you measure it?

Now that you’re seriously exploring the idea of outsourcing your customer service support it’s also an ideal time to think about exactly what good customer service is, or at least what you’d like it to mean for your business.

Quality customer support can not only set you up for success but also set you apart from your competitors. And poor customer service can literally break your business. Did you know that 93% of customers are likely to make repeat purchases with companies who offer excellent customer service? And when you consider that investing in new customers is between five and 25 times more expensive than retaining existing ones, customer service is something that is well worth getting right. 

So what are the key indicators of good customer service?

  • Responsive

    Do your customers feel heard and understood? This means ensuring that all channels of communication are monitored and that every customer or potential customer enquiry is responded to in a timely manner. Even if their query isn’t resolved immediately, it should be acknowledged and then given a timeline for when they can expect a response and/or a resolution.

  • Solutions driven

    The driving force behind customer service is meeting customers’ needs, and quickly. In fact, according to ZenDesk, resolving a problem quickly is the number one quality that customers are looking for in their service expectations. There are two important factors to consider here - firstly, solving the problem and secondly, solving it quickly, which is why your customer service strategy needs to adopt a ‘first contact resolution’ approach. Your customer service agents need to be equipped to resolve issues when they are first contacted - without the need to transfer the customer through multiple sets of hands, or to go back and forth with the customer.

  • Personalised

    This element is often the X Factor of customer service. It will vary from business to business but essentially comes down to knowing your customer, building rapport and delivering on promises. For one business, it might mean being friendly and empathetic; for another, it might mean professional and efficient. Still, it’s all about delivering service that reflects who you are as a business and meets customers’ expectations of your brand. It takes into account everything from tone and language used by agents (both spoken and written) through to technology tools that assist agents in recording and accessing information about customers.

  • Omnichannel

    You should be meeting your customer where they are rather than dictating to them about where you want them to be. We’ll go into more detail about the various customer service channels later but the key is to offer a broad range of contact options and more importantly deliver great service no matter how, when or where a customer contacts you. What’s more, self-service is one form of customer support that is increasing in importance for customers, so see where this might be possible in your business.

So once you’ve set in place a few indicators of great customer service, you need to measure it. As they say “if you can’t measure it, you can’t manage it”.

CSAT

Customer satisfaction or CSAT is a common key performance indicator for customer service teams and tracks how satisfied customers are with your business and its products or services.

Ideally, you should measure satisfaction after every interaction between an agent and a customer. Utilising a Likert scale, your customers will rate their satisfaction from 1 to 5. Then use the number of satisfied customers (rating you a 4 or 5), divide by the number of responses, multiply by 100 and you’ll have your percentage of satisfied customers.

NPS

Net Promoter Score or NPS measures a customer’s loyalty to your business and was developed in 2003 by Bain & Company. It’s often seen as the most important customer experience metric.

Using a single question survey - How likely are you to recommend [business/product/service] to a friend or colleague? - the customer will rate you a number from 1 to 10. 9 and 10 are your Promoters, 7 or 8 are your Passives and 0-6 are your Detractors.

Your final NPS will range from -100 to +100, and the way to calculate it is to subtract the percentage of Detractors from the percentage of Promoters. You can choose to run a survey after every transaction or on a relational basis, e.g. quarterly or annually.

When seeking out an offshore outsourcing partner, discuss your customer service expectations with them and find out how they measure and manage quality standards within their teams. This should include strategies such as monthly reviews, behaviour management and productivity tracking, and they all need to be able to be quantified and reported. Also research your providers tools, technologies and capabilities to ensure they’re a good fit for your organisation.

Customer service channels

In years gone by, you could safely get away with servicing your customers either by phone or email, with email coming a long way behind in terms of use and priority. Now, it’s a different story with customers expecting service where, when and how they want it. So when it comes time to consider your customer service strategy, what channels should you include (hint: if you can manage it, tick all)?

  1. Telephone

    This one almost goes without saying, but it’s more complicated than you might first think. Serving customers via phone is one of the most costly in terms of time, and therefore staff costs. After all, your customer has quite a bit of control over how long they tie up your staff member’s time, and while your staff member is talking with them, they’re unable to do anything else. Connecting via phone to a human resource should be the last step in a customer service journey and reserved for the most complex issues that can only be handled in person. Ensure your strategy directs customers first to an online solution (e.g. chatbot, website FAQs or email) or at least moves them through an automated phone journey. IVRs or Interactive Voice Responses are slowly being phased out in favour of natural voice recognition channels that determine a customer’s intent and other important information, before passing it on to an agent. The agent is then prepared with the knowledge of who the customer is and what they need in order to service the call more efficiently.

  2. Chatbot

    Most customers don’t love the idea of talking to a robot, but the truth is, they probably already have… on multiple occasions. Artificial intelligence is answering basic customer questions for many businesses because it’s highly efficient and available 24/7. And this works well for both the customer (who receives a super fast response whenever they need it) and the business (who has a happy customer without tying up valuable human resources). And if the question gets too involved, it gets escalated to the appropriate channel.

  3. Email

    If a query is relatively non-urgent, many customers are quite happy to send off an email outside of work hours and wait for the response at a later time. This then allows your team to respond when it’s convenient for them, in between other service requests. Just be sure to include automated responses such as an email that acknowledges receipt of the customer query and advises them of an expected response time (we recommend 24 hours ideally, but no more than 72 hours). If the response takes any longer than this, equip your customer service staff with scripted emails to advise the customer of the status, escalation and timing of their customer service case.

  4. Messaging

    Whether it’s via your website or a social media platform, messaging has become an important channel for customer service. Customers will expect an almost immediate response so if your team isn’t actually online, ensure that you have automated responses in place to advise when they will be and when your customer can expect to hear from them. This channel can be quite an efficient way to manage queries because your staff can potentially respond to more than one query at a time.

  5. Social media

    According to SmartInsights, 63% of customers expect companies to offer customer service via their social media channels, and 90% of social media users have already used social media as a way to communicate with a brand or business. This is a channel you simply can’t ignore, yet many businesses are. Businesses on average respond only half the time on social media which can lead to a decrease of 43% in customer advocacy, whilst a reply can increase it by 20%.

Why is customer service and satisfaction so important?

It seems somewhat obvious, but if you want a sustainable business with a long term future, then you need to offer quality service to your customers to keep them happy. This ensures they not only continue to do business with you but also recommend you to other potential customers.

Here are just a few potential benefits of customer service and satisfaction that should also inform your customer support service strategies:

  • Increase loyalty

    Happy customers are unlikely to seek out your product or service through any other company.

  • Increase spend

    Loyal customers will purchase more often and are potentially happy to pay a premium for good service.

  • Generate referral

    Gain new business through current happy customers referring new ones.

  • Remain competitive

    Customer service keeps customers loyal and also differentiates you in the marketplace.

  • Improve profitability

    Retaining customers is far more cost effective than attempting to acquire new ones.

  • Represent brand

    Good customer service reinforces your image, mission and values to your customers.

  • Improve business

    Customer service offers valuable insights into potential opportunities for new offerings or improvements.

  • Increase employee satisfaction

    People love to work for companies that customers love and are more likely to stay if the overall work environment is a positive one.

  • Improve reputation and awareness

    Happy customers lead to a positive reputation and increased brand awareness which is vital for growth in customers, partners, investors and employees.

  • Improve business longevity

    Your business simply cannot survive without satisfied customers and also customers with a high CLTV (customer lifetime value).

Perhaps it’s not so much about realising the importance of customer service but prioritising it within your business strategy. And if you’d like to adopt a best practice approach to customer service, download our whitepaper to learn more.

 

 

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