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Who Knew? Consumers Hate Offshore Call Centers

by Sarah Mahoney , June 18, 2009

The recession, it turns out, is good for customer service. Consumers believe that they are getting better service than they used to from customer-support centers.

But it turns out that outsourced call centers may be costing companies more than they think, and the third annual study of customer satisfaction with contact centers reports that customers "are nearly twice as likely to recommend the company to others if they think the contact center is in the U.S., while they are three times more likely to defect if they believe it is based offshore," reports the Contact Center Satisfaction Index. (The index is created by CFI Group, which uses the University of Michigan's American Customer Satisfaction Index.)

Overall, satisfaction gained 3% -- reaching 74 on a 100-point scale --in a survey that includes 2,200 participants commenting on call-in center services from banks, cable and satellite TV, cell phone service, credit unions, hotels, insurance, personal computers, retail and government.

Miraculously, it's the troubled banking sector that scored the biggest gain, with satisfaction scores jumping 11% to 79. Cable and satellite TV gained 8%, while insurance companies gained 5% to 79. Hotels and personal computers were more or less flat, while cell phone companies, retail and government all declined. But even with those declines, the survey found that the performance of service reps improved in all the areas it measures, including courteousness, knowledge, and effectiveness in handling issues.

One reason for the big gain, the company notes in its analysis, is a much bigger talent pool. "Unemployment is still pretty high, and call centers may be benefiting from more qualified job applicants," it says. The weak economy is also lowering call-center turnover.

But the difference between U.S.-based reps and offshore personnel was distinct. Domestic reps were rated 84 out of 100, while offshore reps were rated just 62. And respondents say that call centers in the U.S. resolved their problems on the first call 68% of the time, versus 42% for offshore.

Consumers are also clear about how much they hate the interactive voice recognition systems used by so many companies, and much prefer reaching a warm body. Customers who have to go the dreaded "Representative. Representative! Rep-RE-SENTATIVE!" drill are much less satisfied than those who reached a real person (69 vs. 79).

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9 comments about "Who Knew? Consumers Hate Offshore Call Centers ".

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Doug Pruden from Customer Experience Partners, June 18, 2009 at 9:58 a.m.
Customer retention and the impact of recommendations are long term benefits to corporations. While it's not surprising that American customers prefer US based call centers, those centers and the reps within them are likely two or three times more expensive than the offshore alternative. And those are costs that come in the current quarter. So while the findings of this study should be meaningful, I won't necessarily expect that they will result in many changes in where calls are being handled.
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Elise Richardson, June 18, 2009 at 10:04 a.m.

Thank goodness companies are finally recognizing that in order to retain their customers they need to provide not just adequate - but GOOD customer service. Consumers are not just loyal because they purchased your product - they're loyal because you provided a great product and pleasant experience.

As it is I always press 0 as soon as I get a chance. Although that still doesn't guarantee that the live person you'll be connected with is competent but at least it's not a computer.

Dennis Mcdonald from McFunk Corp., June 18, 2009 at 12:13 p.m.

Keep in mind that there are some calls where people don't WANT to reach a live operator, for reasons of speed or privacy.

Lee Smith from Persuasive Brands, June 18, 2009 at 9:40 p.m.

Actually the location of the call center has little, if anything, to do with customer satisfaction, intent refer, or other critical performance metrics. The fundamental problem is that many call centers (wherever they are located) employ representatives who do not listen to the customer nor do they try to address the customer's issue beyond what the script and process manual in front of them says.

Add to this the problem of representatives who have "slow computers" or machines that have "just" crashed--and they pass the customer to another representative, and so on, and so on, and so on. Time is wasted repeating issues and frustrations mount. Companies need to understand customer service representatives are the front line for protecting revenue and the brand experience.

A modicum of training along with a "can do" attitude are imperatives for each customer service representative. Without it, customers leave in droves. With it, customers will be happy and tell others.

Tony Engelhart, November 3, 2009 at 1:27 p.m.

Being a outsource callcenter who employs home-based disabled American workers, we are glad to see this trend is impacting businesses. With the current lack of jobs in the US, it is important to create opportunities for American workers. www.directinteractions.com

David Filwood from TeleSoft Systems, December 30, 2009 at 10:14 a.m.

Whether the Call Center is US based - or located in a nearshore location such as Canada - or offshore in India or the Philippines - Top Performing Call Centers drive their Revenue and Performance through Superior Hiring Tactics. In the world of Call Centers – where Success & Failure are so easily measured – it’s not the Hardware or Software that truly makes the competitive difference – it’s all about the quality of the “Humanware”.

Hiring the Wrong Call Center Agent is the Root Cause of most Call Center Performance and Customer Satisfaction Issues. It’s a Significant Drain on the Budget & Bottom Line, on Customer Satisfaction Ratings and Sales Results. Every Failed Hire represents Wasted Dollars Down the Drain. Not to mention the Lowered Productivity, Poor Morale & Higher Absences associated with a Poor Job Fit.

SPAS Call Center Agent Pre-Employment Screening Software is Easy-to-Deploy, Very Cost-Effective and Highly-Predictive of an Individual's Suitability for a particular Call Center Agent Position.

There are Versions of the SPAS Software to Test for:

• InBound CSR (Up-Sell/Cross-Sell/Win-Back)
• InBound CSR (Service & Support)
• Technical Support/Help Desk Agent
• OutBound TeleSales (B2B or B2C)
• Inside Sales
• Order Entry
• Reservations/Guest Services Agent
• Central Station Monitoring
• Information & Referral
• 911/811/511/311/211
• Telephone Answering Service Operator
• TeleCollections

SPAS Pre-Employment Screening Software is a Proven Technology that meets and exceeds all Federal/State/Provincial Government Employment Standards Requirements as a Hiring Tool in the USA, Canada and anywhere else in the world where the ‘Language of Work’ is English. There are also Versions of the SPAS Software available in French and Spanish.

SPAS screens out the Job Candidates who will burn out fast because they aren't suited for the work - and identifies the people with the Personality/Job-Fit, Soft Skills, Motivation, and Work Ethic to be Top Call Center Agents.

With SPAS as part of your Hiring Process an employer is able to select New Call Center Agents who Fit their Employment Needs Better and Stay on the Job Longer - leading to a Call Center Agent Workgroup that has More Experience and is More Productive.

SPAS Software is sold on an Unlimited Usage License basis - there are No "per Test" Fees - "Annual Renewal" Fees – or any other User Fees whatsoever. Technical Support for the SPAS Software is free & unlimited as well. SPAS Licenses are also sold with a 6 Month, 100% Money-Back Guarantee of Satisfaction.

To find out about a Free Trial of SPAS Call Center Agent Pre-Employment Screening Software: http://www.telesoftsystems.ca/64201.html

Jonathan Mirow from BroadbandVideo, Inc., December 30, 2009 at 5:29 p.m.

David - Hideous pimping of your own product - a simple URL would suffice. 6 paragraphs of product buzzwording, comon. As far as call centers, let's be honest here folks - if the people speak ENGLISH as a first language we're far more inclined to stay on the phone. I once spent 10 minutes trying to explain the difference between the "format of a file" and "formatting media" - the nice girl (who's name was not "Betty" no matter what she said) simply could not get through the language barrier. Net result? The company lost another subscriber at $15 a month. Sorry to be politically incorrect - but we speak english here, you should too.

George Smith from GWS Consulting, December 31, 2009 at 5:40 p.m.

After almost 35 years in the call center business, I have seen it all from virtually day 1. Personally, I have come full circle and now only recommend a combination of IVR and Live Agent with the Live Agents in a brick & mortar (B&M) U.S. call location.

The reasons are simple and from the best university possible; i.e., "The School of Hard Knocks":

1. Off shore is very frustrating for the callers who are typically not in the best humor to begin with due to the reason they are often calling. The off shore agents mean well typically but they are too hard for most of us to understand. Let's face it. call centers went off shore to save money not to improve service. Often they think they have to do it to remain competative.

2. Some people prefer an IVR and thus if they want to use it, why not? This assumes there is an "easy" out to a live agent.

3. B&M because when one thinks about it, the Home Agent model implemented has a serious flaw which is important to recognize. These agents are almost always compensated only for their "talk time". If clients would listen to their calls they would be shocked to hear the chitchat that a Home Agent often does with the caller as the meter clicks away.

Anne Peterson from Idaho Public Televsion, December 31, 2009 at 7:46 p.m.

I do remember an experience when call centers moved to the American Deep South and neither the call center representative nor I fully understood the other. So the physical placement of the call center is only part of the customer satisfaction equation. The type of English spoken is another piece of the equation.

Before call centers in the late 1970s, I tried to do a phone order to a major camera/photographic supply business in Brooklyn, New York. The person who answered the phone and I simply spoke two different languages even though we both thought we were speaking English.