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The Rising Importance of Contact Centers

The Rising Importance of Contact Centers

/ Strategy, Customer Experience, Technology, Omnichannel
The Rising Importance of Contact Centers

Do not underestimate centers’ value to the business.

Every year we read articles about how vital contact centers are; insiders almost always write them, but rarely do we read the same opinion from people in the C-suite. The truth is many executives see contact centers and customer experience (CX) as cost center mysteries, and this disconnect can result in significantly underestimating the strategic value they provide.

But the last few years have legitimately challenged those perceptions for the better. Contact center demand is way up, driven by the COVID-19 pandemic, according to research from Pindrop, with some centers experiencing a doubling in contacts taken, not including deflections! And from what I have seen, heard, and read in the industry, the need for contact centers is continuing to be unabated.

However, just because contact centers are at last gaining some well-earned respect does not mean they are improving performance. Just look at the American Customer Satisfaction Index as proof. Year after year, it changes little.

It is with these realities in mind that WiserOwl surveyed 1,000 U.S. consumers to better understand their shared perceptions and experiences with contact centers. The findings are published in our 2023 State of Contact Centers and Customer Experience Report. Here are the key findings.

A staggering 91% of consumers say they would leave a company after a couple bad experiences, and 64% say they value CX more than price.

But is this legit?

The answer comes down to how easily customers can leave and how much better or worse the experience is compared to the competition. Some executives feel protected from the consequences of diminished CX because of strong competitive barriers, like government regulations or high commoditization.

...many executives see contact centers and customer experience (CX) as cost center mysteries...

But this is a hazardous strategy. A new or existing competitor could exploit poor service or commoditization to capture more profitable portions of market share. Toyota took this approach when they set the bar for CX with the Lexus brand and Apple customers rave about the experience as much as they do about the products.

Consider airlines. Air travel on large U.S. carriers is regarded as a cheap ride, even in first class. But traveling with Singapore Airlines is considered an experience.

Singapore Air doesn’t want to take low-margin domestic business from U.S. carriers; they want to take a higher profit from international travel. And they’re getting it!

Until humans can control the weather, contact center customer service and experience will matter a lot, from ticket purchase to landing. Particularly when delays, cancellations, matters like lost luggage, and unfortunate events happen, and customers require accurate, timely information, delivered with a sincerely assuring empathetic voice from agents who are seeing what they can do.

As an aside, no U.S. airline ranks in the top 10 in the world (CNBC, Nov. 2022).

The point is that underestimating the positive impact of contact center-driven CX can be the unwelcome start of the competition getting in your wallet.

The real question executives want answered is how can my contact center provide a sustainably better customer experience without costing more money?

99% of consumers believe contact centers are an essential part of CX.

The COVID-19 pandemic fundamentally changed the way consumers shop, and while some businesses have chosen to invest in their contact center agent capabilities, others have looked to offset them.

Case in point: Frontier Airlines has eliminated human contact centers for complete technology-driven customer engagement (Forbes, Nov. 27, 2022). The results are not in yet on this experiment, but our survey suggests this will likely further commoditize their offering.

I say this because executives that underestimate the value of CX and dehumanize contact center customer service are on a slippery slope. They go from commoditizing their service offerings to commoditizing their customers.

And as soon as customers feel they are not unique, they will leave, if they can, in droves. Falling back on loyalty programs that are easily copied is just another form of commoditization that further diminishes the value of one’s product.

This point raises an important consideration. Big and well-positioned companies do not lose to competitors; they create their own downfalls by making decisions that steer more profitable customers to competitors that offer similar products with better service. And undervaluing the benefits of the contact center CX provides competitors with that opportunity.

Again, the real question executives need answered is how can my contact center provide a sustainably better CX without costing more money?

62% of consumers anticipate experiencing dissatisfaction with a company’s contact center in the next 12 months.

Hearing that nearly two-thirds of consumers anticipate dissatisfaction with a company’s contact center in the next 12 months is simply deflating. This puts into perspective how impactful contact center and customer engagement is to customer loyalty and the risks to underestimating their value.

The fact is that a single poor experience has huge carryover into the next engagement, and executives need to recognize this consumer mindset to avoid underestimating contact enter value. This recognition must extend to both human and non-human channels.

Just ask yourself, how many times do customers complain of a poor experience with an agent versus chatbot or other self-service offerings? With the high volume of contacts being deflected to non-human channels, even a small percentage of dissatisfaction there equals a large amount of business.

To understand the true value of contact centers and customer experience, executives need to know how can my contact center provide a sustainably better CX without costing more money?

Why might you ask is this so important? Because in answering this question, everyone will learn exactly what their money is doing for the business already. It’s a revelation!

Look at it this way. Without the order of operations in math, people will come up with wildly different answers using the exact same data. This is happening in contact centers today: lacking an order of operations for decision-making!

86% of customers are willing to pay up to 25% more for excellent service, and 95% expect an omnichannel experience.

To boost profits, executives must not underestimate the value of enabling contact centers to serve customers in a way that suits their needs at any given time: and they must do this nearly flawlessly every time.

To meet customers' lofty expectations and be profitable, businesses must enable their contact centers to become more financially fact-based...

To accomplish this outcome without requiring more money, it should be a mandatory first step that contact centers must be financially fact-based in determining actions that satisfy executive needs to optimize spending: while balancing customer needs to engage the business in whatever way they want. Profitability for actions should be the rule.

What should be the contact center order of operations?

  • Financially Driven. First, it means accurately optimizing contact center performance on a cost-and value-returned basis. Phone, email, chat, web self-service, and social media should balance based on the cost to serve and value-derived. In other words, if a particular channel has a higher profit per customer than other channels, then should the business direct more business through that channel, at what gain, and at what cost?
  • Enablement. Second, enable agents to complete customer journeys without needing help. This is where a great culture can be a massive differentiator in promoting agent empathy and instilling the confidence they can do a great job.
  • Empowerment. Third, empower agents to own decision-making about where they spend their time (and your money). When agents know their choices have a cost and are being measured on a level playing field, it dramatically improves productivity, morale and CX.

CX and Loyalty Takes More Than Investment

Improving CX and loyalty is more than investing in the right tools, technology, and strategies. It’s about following the contact center order of operations to understand and balance the cost of service with the opportunity of incremental profits by channel and team, maintaining strong relationships that grow loyalty and repeat business, and spreading the word.

This is the only way for executives to not underestimate the true value contact centers bring to their business, and the only way to optimize performance for the money spent.

As this article has discussed, there is increasing importance of contact centers in shaping consumer perceptions and loyalty. To meet customers’ lofty expectations and be profitable, businesses must enable their contact centers to become more financially fact-based by using an order of operations that optimizes the cost of experience with benefits of delivering.

Robert Bradshaw

Robert Bradshaw

Robert Bradshaw is president, WiserOwl, which exposes gaps in contact center optimization that contribute to over $75 billion in missed opportunities every year. These gaps are revealed by fusing every contact center action to its precise dollar value in near real-time across all channels and teams.

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