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Turning a Profit with Customer Care

Hosted Call Center Featured Article

Turning a Profit with Customer Care

August 09, 2010
By Rob Duncan
Chief Operating Officer, Alpine Access

“Winners take the same ingredients as everyone else and produce the best results.”

Edward de Bono

The last few years have been, without a doubt, one of the worst times in history for America’s largest companies. In fact, this year’s recent ranking of the Fortune 500 showed a combined revenue decline of nearly 9 percent compared to last year. Companies that have posted steady growth for years have been suddenly faced with critical losses. Budgets have been slashed, corporate spending is down and businesses are struggling to do more with current resources. One area under intense scrutiny is customer care. Now, more than ever before, support organizations are being tasked with generating revenue in order to offset the cost of operations and make a positive contribution to the financial bottom line.


Cost Center to Profit Producer

Traditionally, contact centers have been categorized as business cost centers. This in and of itself is not necessarily detrimental as there are a number of divisions within a company that act as cost centers, such as research and development or marketing. However, when companies are forced to reduce expenses, these areas are often the first to suffer cutbacks and layoffs.  Of course, savvy executives understand that high quality customer support is crucial to the long-term sustainability and profitability of a company. But when faced with “reduce costs or else” scenarios, executives make tough decisions to simply stay in business, many times sacrificing anything not directly generating revenue.    

Those in customer care must reinvent their departments and find ways to prove significant financial value beyond customer satisfaction. Operating as a cost center is no longer an option. Instead, customer care centers must find ways to produce a profit by not only cutting costs, but also by generating revenue. Fortunately, virtual contact centers provide a roadmap for delivering high quality care while also selling more products and services.

Virtual Contact Centers Increase Revenue

As the virtual customer care model has become mainstream and widely adopted by Fortune 500 companies, much has been written on the advantages of using at-home agents. Most discuss the obvious benefits such as a better educated and experienced workforce, higher satisfaction scores, more efficient operations and reduced environmental impact. In fact, each of these benefits has been a topic of my previous articles. But rarely has anyone pointed out that virtual contact center agents also generate more income per call than either in-house staff or outsourced brick-and-mortar centers.

Consider these findings from Frost & Sullivan (News - Alert):

Home-based agents increased revenue by more than 18 percent per call for an online provider of flowers and gifts.

A leading home shopping network increased revenue by $26 million after switching to a virtual customer care provider.

Home-based agents increase sales conversions by 15 percent.

Personal experience supports these findings as well. For one of our telecommunication clients, Alpine Access employees secure 51 percent more dollars per call compared to two comparable B&M centers, and our average order size is 32 percent higher for a national office supplies provider.  

These statistics demonstrate that high quality customer interactions result not only in increased satisfaction and loyalty, but also in actual hard dollars. This fact is especially important to companies who have found that only reducing costs may not be enough to operate in the black.

The Money-Making Difference of Home-Based Agents

The demographics of at-home agents help them approach each call with the knowledge, experience and confidence necessary for selling-type activities. Below are a few of the ways in which home-based agents produce higher revenue from customer interactions:

Better Attitude – People buy from people they like. At-home agents tend to be happier in their jobs because they are provided with a more satisfying work/life balance. This positive attitude translates into a more outgoing disposition, allowing them to better establish rapport with customers and offer suggestions for additional purchases.

Greater Knowledge – Knowing product and service details are essentials. For effective up-selling, agents need to be able to articulate the value of the brands, services or products they represent. This can only be achieved through comprehensive and effective training. Virtual centers leverage innovative technologies and immersive multimedia environments to improve knowledge retention, ensuring that at-home agents are always up-to-speed on the latest information to help them close the sale.

More Experience – Up-selling and cross-selling during a customer call takes confidence and experience. At-home agents have an average of 15 more years of work/ life experience than those in B&M centers and 80 percent are college-educated. This creates a more mature and educated workforce with the confidence to ask for the up-sell/conversion.

Lower Attrition – At-home agents have consistently proven to have lower attrition rates than agents in B&M centers. In our experience, which is also validated by various third-party studies, attrition rates among at-home agents are often half that of their B&M peers. This saves money through lower recruiting and training expenses and creates an agent pool that has longer tenure with more experience, all of which improve their ability to up-sell or cross-sell.

U.S.-Based – According to a 2009 survey conducted by the CFI Group, customers who perceived their calls were handled offshore were 32 percent less satisfied than those who believed they reached someone onshore. At-home centers use 100 percent US-based agents. This improves the customer experience and ensures that callers will not only complete their initial transaction, but that they will also place additional orders in the future.

Transforming customer care from a cost center to an income generator is a smart strategy whether your business has suffered economic hardship or not. No longer can companies tolerate business divisions that are not optimized to deliver financial results. Home-based agents have the skills and experience necessary to wow customers and deliver greater call-to-sale conversions, higher order sizes and more repeat business.  Combine this with the other benefits of home-based agents, and you have the ingredients for a customer-focused, profitable business.


Rob Duncan is COO of Alpine Access, Inc., a Denver, Colorado-based provider of contact center services using exclusively home-based customer service and sales employees.Duncan can be reached at 303-279-0585.

Edited by Erin Harrison
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