Cost Saving Customer Support: Myth or Reality?

Cost Saving Customer Support: Myth or Reality?

Cost Saving Customer Support: Myth or Reality?

As client care teams are responsible for both acquiring new buyers and retaining the old ones (just as marketing department, for instance), a company should not underestimate the role of these professionals. Thus, it is vital to know the justified customer service cost and way to reduce it.

What can you sacrifice to cut costs? How should you estimate the cost of client care service and which factors to consider? This post will give all the answers.

Save Сost Customer Support

Customer Service Cost: Performance Metrics to Consider

When you hire a specialist to join a customer support team, you should consider their previous experience, education, achievements, feedback, and skills. It is critical to understand that experts cost differently based on their background info. Carefully study the resume and salary expectations before deciding whether you can afford to recruit a specific expert.

When choosing which candidate to hire, you should take into account several things that you can detect:

  • From resume
  • From cover letter
  • During the interview
  • By offering a quick test
  • From the feedback of previous employers and clients

It is necessary to operate some performance metrics when defining the cost of customer service. For example, even such things as extraversion counts. It is called a big-five personality trait, and many recruiters underestimate how critical it is.

Also, ask a candidate to pass an IQ test to determine their cognitive ability as it was found that this factor has a great impact on the quality of client support too.

Mind the expenses associated with staff training. No matter how experienced the people you hire are, even if they used to work in a similar niche before, your product or service still should have some outstanding features. The idea is that customer support reps should be ready to respond to any questions of the customers without having to find a solution in multiple-page documentation. It will force customers to hold on, but people hate waiting. Other essential factors to keep in mind are:

  • Conscientiousness
  • Service climate
  • Competition
  • Individual client service performance
  • Team-level customer care performance
  • Client satisfaction

Customer support that saves costs

How to Estimate Client Support Costs

There are more than ten approaches to calculating the cost of customer service operations. First of all, it depends on whether you wish to pay hourly, daily, weekly, or monthly. Let’s consider sales per hour. Think about how much your staff generates per hour of work. Define the current rate, factors that might make it higher, and estimate the possible income. Also, you should consider the factors listed below.

  • How much the customer acquisition cost

In most businesses, it is way easier to motivate loyal customers to buy or order your goods or services than to find a newbie. At the same time, it is more expensive to retain the existing customer base. That is the primary mission of a customer care representative.

You may evaluate the effectiveness of retention measures as well as several newly obtained clients when deciding on the appropriate wages for your support reps.

  • The physical costs of having an in-house or outsourced team

Even though the support operations will cost you less, you still should take into account a cost per call along with monthly fees to pay off. The expenses of an in-house support department include equipment, tools, furniture, premise, utilities, internet, etc.

You should think about the ways to save some money with no harm to work of the client support team. One of such solutions, for instance, is choosing a flexible managed office space.

  • Sales returns and average order value (AOV)

Just like in a financial pyramid, it is necessary to consider how many orders were completed and paid thanks to the specific customer support rep. That is when an average order value (AOV) will come in handy. Also, a recruiter should keep in mind the potential costs of extra training unless the in-house employees with vast experience would agree to share their skills and knowledge at no charge.


How to Reduce Cost of a Customer Care Service: Tips

One of the most effective ways to save company money is to use outsourcing services. Outsourced teams cost less, especially when they are hired from the Eastern European or Asian agencies. However, you should carefully study the terms of the chosen firm and negotiate the price before signing any agreements.

Also, stick to the following recommendations:

  • Make use of social media. Use social media channels to its fullest: register your brand on as many platforms as possible and always rely on the comments of your customers.
  • Add live chat and FAQ sections. To save time, come up with the answers to the frequently asked questions. The good idea is to add new questions each time they pop up even if they are not that frequent to save not only money but also the time of all involved parties. A live chat will allow replying to the customers very quickly.
  • You can also promote self-service. It does not work well with all services. If your product does not require a user to be tech-savvy, you may think about involving a self-service. Many shopping malls and supermarkets benefit from doing so.
  • Get your reps ready effectively. Optimize the time spent on training sessions. If you avoid hiring an external trainer, it is your chance to cut costs significantly. You can also think about ways to boost the productivity of your staff. One of the methods is through installing special apps or using specific services for better performance of customer support.

You should not save every cent on things that matter. It is not a good idea to reduce IT cost, for example. Without proper software, apps, and quick machines, your client care reps will not be able to serve your clients fast and effectively. Thus, upgrade the equipment and software regularly.

As you can see, there are many ways to estimate the costs of customer care services and minimize them. No matter what you do, make sure the customers stay satisfied with the work of your support. For example, you can use surveys to collect feedback, but that is another story.


Maya Momotok

Reviewed by Maya Momotok
CEO and cofounder of Wow24-7

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