What defines a contact center’s profitability? Contact center success is typically measured in the form of improved operational efficiencies, agent productivity, cost reduction, and customer experience. These measures have become the status quo of benchmarking contact center performance becoming the primary focus for majority of contact centers. But the problem lies in articulating how organizations “profit” from contact centers.
According to ICMI and Zendesk Research, 62% of contact centers are perceived as cost centers by the rest of their organizations. A startling figure that puts contact centers are a very high disadvantage. A disadvantage that will come into effect when contact center managers or leaders ask for investments in tools, resources, and technologies to better serve the customers.
Every contact center has the potential of being a profit center. But it largely depends on how you define profit centers. The research stated that 50% define profit centers as one which provides financial gains to the organization, and 41% defined it as one which provides financial gains as well as additional advantages and benefits to an organization. What are these additional benefits contact centers can provide that will drive the profitability of the organization and help them stand out as a competitive differentiator?
If a profit center is just about financial gains, then it is safe to assume that revenue generating contact centers are unanimously profit centers. But the scary truth is that over half of those revenue generating centers are also recognized as a cost center by their organization. Being a profit center is not just about generating revenue, or about the dollar amount, but the value it provides to the organization.
Here are 4 Tips to Transform a Cost Center into a Profit Center
TIP #1. Driving Cost Efficiency
Contact centers were brought into existence to drive cost efficiencies in the organization. They were means to handle customer communications by optimizing available resources. But somewhere down the line, contact center efficiency lost their purpose and shifted their focus on quantity over quality. This resulted in customer frustration, repeat contacts, agent dissatisfaction, and increased attrition. Contact centers that have steered away from this practice and focused more on quality communication and processes are capable of delivering efficient service while improving employee and customer satisfaction. Just over half of the contact centers surveyed by ICMI (54%) believe that they are providing this basic level of cost efficiency to their organization.
Fundamental metrics like service level, scheduled adherence, and forecast accuracy enable contact centers to monitor and control their cost efficiency. Identifying the right service level objectives and effective measuring them will help contact centers gain actionable insights on customer experience. Schedule adherence ensures that agents are ready and available to handle customer communications. The third metric, forecast accuracy reveals how effectively the contact center anticipates demand in workforce and provides critical insight into actions that must be taken to optimize the process. ICMI’s latest research showed that 50% of contact centers do not measure forecast accuracy. Checking the accuracy of every forecast and learning from the errors will help contact centers to improve efficiency.
TIP #2. Maximizing the ROI of Customer Satisfaction and Loyalty
Organizational success and long-term growth undoubtedly depends on customer satisfaction and loyalty. And the contact center has the greatest impact on customer retention and advocacy. In addition to being the dominant factor in driving customer satisfaction and loyalty, it is essential for contact centers to have formal methods of measuring customer satisfaction and customer retention. However, the research revealed that at least 20% of contact centers have no formal way of measuring customer satisfaction. And an alarming 49% of contact centers are not measuring customer retention. They do not know when and why they are losing customers.
TIP #3. Leverage Contact Center as a Strategic Asset
Contact center is a goldmine of information. Information that can elevate the contact center to a highly strategic asset to the organization. Being the organization’s hub of communication, contact centers has a wealth of rich customer insights and robust data that can be harnessed and shared across the organization to drive improvements, innovations, and long-term growth. In an era of customer-centricity, it is counterintuitive of contact centers to neglect the potential of such information, but system complexities, information inundation has proven difficult for contact centers to utilise this powerful insights. The contact center can break the cost center stigma by positioning itself as a strategic asset, capable of providing deep and actionable insights. ICMI’s research revealed that while many 70% of contact centers use the data they generate to improve efficiencies, 60% use it to improve consistency of customer experience, and only less than half of the contact centers are sharing their insights with the rest of the organization. This is definitely not an easy task, but by harnessing the intelligence garnered from interacting with customers, contact centers have enormous potential to provide value to the organization.
TIP #4. Increasing Revenue Opportunities
Revenue-generation can only be maximized by enhancing the agent’s ability to convert cross-sell and up-sell opportunities. This can increase revenues, build customer relationships, and increase customer awareness. However, according to Loudhouse Research, 86% of strategic decision makers in contact centers do not think that their agents currently have the skills required to meet their obligations in terms of upselling and cross-selling. Organizations should invest in identifying skills that lead to revenue-generation, and train and coach agents to use the most important skills. Despite these opportunities, only 45% of contact centers are offering such programs, but when utilized, over 52% of contact centers reported observing an increased revenue per contact. The most challenging part of implementing revenue-generating programs in your contact center is procuring sales enabling technology that works as an extension to the existing customer support platform, a technology that can easily integrate with service and sales functionalities.
With evolving customer expectations and service complexities, contact centers are poised to deliver strategic value and profitability to organizations in the years to come. Perceiving contact centers as a cost center is archaic and needs to be disposed off, if organizations wishes to see the real potential of a contact center.