The Pro's and Con's of Outsourcing your Customer Support

After understanding the major role of customer service for online business, the next step is for ventures to understand how to manage a service team with scarce resources. A common solution is to outsource, but what are the Pro's and Con's of that?

Outsourcing Benefits

Save Costs

According to John Chow , the number one reason for companies to outsource their service department is to reduce costs:

Some businesses consider in-house customer support as an expensive absorber of precious time that could be better spent on core tasks. They believe that applying valuable human resources to solve customer service issues drains focus from the core tasks the team is specialised in, decreasing overall productivity.

Keep Stress Out of the Door

When outsourcing you have a fully-committed team, with customer-support expertise taking care of your back-office operations and administrative work. Even though you will need to constantly monitor their performance, you will not have to deal with every single enquiry, keeping some stress and hustle out of your sight.

Even though outsourcing may be an excellent solution for some, there are some elements you should think about before making up your mind on whether to outsource your customer service:

Outsourcing Downsides

Brand Image Disruption

For many companies customer service is an important part of their branding strategy. The way they interact with customers, the attention given to issues and the close relationship are a part of that. By outsourcing your support service some of these elements might be lost, or at least affected. Customers will most likely notice and the risk of that affecting your brand image is high.

Loss of Control

When you outsource you can ask for ‘standards’, but you will lose control. There is no way you’ll be able to walk through your outsourced service agents department everyday and give tips on how to deal with issues.

Confidentiality of Your Customer Data

It is hard to establish a line of trust where you can be fully confident that your customers data is safe with the outsourced support company. Especially for bigger clients, this is one of the most worrying aspects of hiring third party service providers. Before signing a contract look for the data security measures in place and try to find some references from other clients of the contracted company.

Loss of Culture

Culture traits and personality marks are the hardest elements to convey through outsourced support. It is only natural that third-party agents will not be able to nail in conveying the same exact service that you do, in-house.

Loss of Feedback Spillover

One of the greatest advantages of providing support service yourself is the possibility to collect direct feedback from your customers. As we have learnt from the Feedback Loop , measuring and learning from customers is one of the best methods to accordingly develop your product to market’s needs. This is also why some companies consciously let departments that are normally not in direct contact with the end customer do some service work. This way they get to understand the customer and get a better idea of what effects their actions have. By losing this direct bond, you will probably lose out on direct quality feedback.

Final Considerations

Ultimately, the decision to outsource should be a strategic one and not (only) depend on cost minimisation. It is important to ask yourself the question: can the outsourcing party deliver as good as a service as I can? When the answer is a convincing ‘No’, then the opportunity costs that result from outsourcing should be taken into account. This is however not an easy calculation, as it’s hard to estimate how many customers and referrals you’d miss. It may also be the case that the outsourcing party can deliver a service superior to yours due to their experience and/or excellence in knowledge management. Be sure to take all these factors into consideration.

If you are interested in outsourcing your live chat support, you can take a look at our partners Octopodo and the Chat Shop . What are your experiences with service outsourcing? Share them with us in the comment section below!