Organizations must never forget the old adage, the customer is always right, especially in the current business landscape. Customers have higher expectations and reduced patience with slow customer service. Inquires made through either email or Web sites frequently take days to be answered. Many enterprises are not equipped to properly meet customer needs through these channels. By outsourcing the process to Indian service providers, buyers can plug the holes in their customer service pipeline while realizing significant savings.
Fumbling and Bumbling
The Customer Respect Group of Bellevue, Washington, an international research and consulting firm, shows the substandard state of online customer care. In its June 2003 survey, 2003 Online Customer Respect Study for the 100 Largest US Companies, only 59 percent of the largest U. S. firms succeeded in responding in two days or less with almost a third not responding at all.
In another study, Jupiter Research of New York found that only a little more than half could respond within a day in its report, Jupiter Research Metrics: Customer Relationship Management, June 2003.
David Daniels, senior analyst for Jupiter Research, explains the danger of slow response. “We feel that there is more risk of losing customers from doing email poorly than via the phone. Some companies have to relearn how to do customer service again.”
Lance Travis, vice president of outsourcing strategies for AMR Research of Boston, Massachusetts, notes that the slow responses defeat the use of the channel. “Companies have not been getting the performance they need. Only about 14 percent of the traffic is going through an email type of response. Customers are not flocking to that channel because you send the email off and it’s a black hole.”
Thorsten Ganz, vice president research for The Customer Respect Group, adds the customer should now be the focal point. “Customers are driving everything. They will be less patient with non-responsiveness. The company needs to stay up with where the customer is going.” Travis notes that consumers now expect a rapid response. “Customers expect a response that business day,” he says.
The customers understand technological capabilities and have higher expectations, according to Daniels. “That is driving service to be a more important branding differentiator. There is little mercy shown by consumers today.” This chart from Jupiter Research shows the high level of customer dissatisfaction; email response time is the second most cited category for service improvement.
Low Tech to High Loss
Organizations often make a big mistake by just using common email products like Microsoft Outlook or Exchange. There is also the fallacy that email is inexpensive, according to Daniels. “The notion that email processing is more cost effective than the phone is a bit of a myth because email remains a fairly resource and staff intensive process.”
Customer inquiries that do not get prompt attention can accelerate costs as an agitated disgruntled consumer moves to the phone, notes Daniels. “Fifty-seven percent of consumers will make a phone call if email inquiries are not answered. This balloons costs. Poor service online will only accelerate the rate at which people turn to the phone.”
Efficient Economical Expertise Through Outsourcing
By leveraging the advantages of labor arbitrage in India, companies can reduce costs and shorten response time. India offers a large educated English-speaking pool of talent whose labor costs are a fraction of those in the U. S.
But perhaps most importantly, Indian outsourcing providers in email customer care offer expertise, infrastructure, and experience. Having recognized the market, Indian providers have developed over many years. They offer a core competency that provides a response to a customer inquiry in under six hours, frequently to a benchmark of two hours. “Companies have been successful by outsourcing to India to improve response time,” states Daniels.
Jupiter Research reports in the June 2003 report, E-mail Automation – Making the Internet’s Killer Application Pay off, that outsourcing to a provider based in India “is recommended for companies seeking to a response time of under six hours.” It is also optimal for more routine and simple inquiries that do not require complex high priority resolution. Many North American outsourcing providers in customer care are adding India to their mix for faster, more cost effective email response at lower touch points.
The cost savings are considerable, according to Travis. “We are seeing that people can save a considerable amount, in the 30 to 50 percent range, when they outsource to India.”
The Jupiter Research chart below shows the considerable cost savings.
Outsourcing to India enables an enterprise to add efficient expertise in the online customer care channels in a cost effective manner. This is essential in the customer driven economy according to Daniels. “Service is an increasingly important differentiator for retention and selection. The notion that price is the major differentiator is a bit of a myth.”
Travis notes that the attitude of the Indian agents is also an asset. “You get people who treat this as a profession and have a higher emphasis on satisfaction and overall quality.”
Ganz warns, “One thing that continues to surprise us is that companies spend a lot of money on very expensive systems and fail to meet customer expectations. The more sophisticated the customers become, the more sophisticated the company needs to be.”
Travis concludes that outsourcing customer care in the online channels to India harnesses many advantages. “By outsourcing you get the cost savings benefit and also get to augment your staff. So you save money and see an improvement in service levels. It is a big opportunity.”
Outsourcing customer care in the online channels to Indian service providers is a wise strategy, observes Daniels. “Outsourcing offshore not only improves the bottom line, but, more importantly, improves the customer experience by drastically reducing email response times.” Simply put, outsourcing can improve branding as well as reduce costs and customer loss.
Lessons from the Outsourcing Journal:
- Many organizations are not equipped to meet customer service demands in online channels in a timely fashion.
- Outsourcing online customer care to India reduces response time from days to hours and significantly reduces customer support costs in online channels.
- Offshore providers may have lower benchmarks than their American counterparts.