5 Reasons Not to Outsource Your Customer Service


Skyrocketing sales are great for your bottom line—but sometimes aren’t so sweet for your customer support team, who are suddenly deluged with inquiries about whether your products are vegan or hypoallergenic, and by the way, is the red shoe pattern  more of a ruby-red or a maroon shade, and when is that order arriving again? 

Sure, your agents want to be helpful and present your products in the best light, but with thousands of support requests coming in every day, they’re finding it hard to keep smiling. They’re overwhelmed and burned out. You need to add to your customer support team, stat. 

The problem is, building an in-house customer support team isn’t cheap. 

With minimum wages in many U.S. cities now exceeding $15 an hour, you’ll be spending thousands every month on each new customer support agent from day one, regardless of how much training they need to get up to speed. And what if they don’t stick around? Turnover rates in the customer service industry are notoriously high: Turnover rates for customer support roles range up to 35 percent, based on recent studies, and the cost to replace and retrain a lost agent is pricey, too: Human Resource Institute estimates turnover costs between $10,000 to $15,000 for a frontline agent. With in-house customer support agents, the cost of each answered query can range from $15 to $100, based on one company’s case study. 

It’s no huge surprise that plenty of companies go looking for an alternative model to fulfill their customer support needs—and more often than not, that option ends up being outsourcing customer service to a BPO (business process outsourcer) that specialize in handling queries that come in via email, chat, phone, social media, and other channels. To keep labor costs low, they typically use support agents based overseas, where the minimum wages are lower. In theory, the lower cost of this customer support will help you and your team free to focus on important strategic decisions — your product or service or your vision. But it doesn’t always work that way.

If you’re considering customer support outsourcing, here are five limitations of working with a customer service BPO:

  1. Outsourced customer service hurts the customer experience
    Customers can generally tell if your customer support is being handled by an outsourced service provider—and they aren’t happy about it. When you show customers that their concerns aren’t important enough to be handled by someone from your in-house team, that leaves a bad taste in their mouths. And that can translate to negative feedback and poor reviews, regardless of whether the outsourced support agent is able to adequately handle their concern or not.
  2. Communication barriers can be a problem
    If you’re using an offshore customer contact center, the service provider may hire support agents who speak English as a second language. While they will generally be able to follow a script pretty well, what happens if the customer has a question that doesn’t fit the script, or that the agent doesn’t understand the customer’s issue due to language barriers or cultural differences? In these types of scenarios, the customer may get frustrated, and will likely need to spend more time waiting for yet another agent to help them resolve their issue.
  3. Outsourced support agent turnover can be even higher than in-house turnover, leading to quality control issues
    Even if your team has provided training to your outsourced contact center, you can’t oversee every level of communication. At contact centers, employee turnover happens frequently (around the 40 percent mark), so managers must constantly focus on training new staff on your company’s processes. Although they may have policies in place, new employees won’t always grasp the nuances of your product or understand what a customer is asking. 
  4. Your data security could be at risk
    Any time you turn over access to customer data to a third-party BPO, you need to trust that they are using best-in-class security protocols to protect your company’s and your customers’ confidential data. But that’s not always the case, and your company’s data security is only as strong as your BPO’s weakest link. In recent news, a New York-based firm experienced a data security breach in Mumbai due to employees of a BPO the company had contracted with. Minimizing access to confidential data by third parties will significantly reduce the risk of falling victim to a breach.
  5. It’s not the most cost-effective option for customer support
    Although working with a BPO is cheaper than hiring a team of in-house support agents, it’s still considerably more expensive than options that rely on automated customer support with the ability to escalate to a live support agent.

If you want to lower the cost of customer support, ensure that customer support requests are answered quickly, and focus on delivering a superior customer experience, an outsourced customer service team isn’t the way to go. So what is?

Instead, consider using an AI-supported customer support solution that empowers customers to find the answers to their own questions, eliminating the need for them to talk to customer support agents at all in many cases. By adopting this model, you can combine the cost-savings benefit of outsourcing customer support while maintaining the high-quality in-house support and superior customer experience that your customers are looking for on those occasions that they do need to speak with a customer support agent

Implementing a self-service customer support solution that guides users to relevant content in your knowledge base has been shown to reduce customer support ticket requests by as much as 50%. As your company scales, you won’t need to scale your support team so quickly—as your customers embrace the self-service model, you’ll be able to allocate your in-house customer support agents towards more complex or higher-value customer support inquiries. This will make it sustainable for you to manage a small, high-qualified in-house customer support team, while still providing quick and helpful responses to all of the customer inquiries that come in. 

Don’t take the risk of alienating your loyal customers by shifting your customer support to a BPO. Take control of building a best-in-class customer experience by putting solutions in place that help customers resolve issues quickly on their own terms, whether that involves self-service or live support from an in-house team.

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