Can we increase customer profitability by starting a call center?

Can we increase customer profitability by starting a call center?

Do you have experience with the anticipated benefits to an organization setting up a call center? For example, is there a way to know if a call center will be beneficial for a company, looking at factors such as these?

  • Increased operational efficiency of X percent
  • Consolidation benefits of X percent
  • Increased customer satisfaction benefits of X percent

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    These are very good basic questions. But I'd like to ask the question another way, rather than just asking whether or not we can see a kind of efficiency that comes from using call centers. Rather than simply thinking of call centers as a sort of necessary evil, I'd like to look at what the call center contributes to customer profitability, and then look at call center effectiveness in doing that.

    For example, Capitol One has call centers in which the call center representatives are compensated partially on not how many calls they can get though in an hour, but rather how many problems or questions are resolved on the first call. It's interesting that, in such a situation where they are trained and encouraged to handle customer problems and they are empowered to resolve problems and take care of things, that they actually turn 15% of incoming calls -- nearly all of which are problems or complaints -- into additional sales, cross-sells or up-sells. So that's what can happen when call center reps are actually listening to customers.

    The opposite of that would be the kinds of call centers where the goal is to try to keep as much money in the company today but at the expense of the future.

    For example, it has become notorious that Vonage is a very easy company to sign up for. You can go online and sign up for Vonage service -- but if for some reason you'd like to discontinue Vonage service, you can't do that online. You have to dig out -- with some difficulty -- a telephone number, that nobody really answers. So it takes you a month or two, during which time you are paying service fees, and eventually you might be able to get disconnected. That's not playing fair.

    The point is, we have to ask the right questions. How do we make sure that we are using the call center to increase the value of the customers who need to use it rather than just how do we deal with this evil necessity in our company of taking care of stuff? And how do we think of call center effectiveness, rather than call center efficiency?

    Hear more in Creating Customer Value, a SearchCRM.com monthly podcast series with Peppers and Rogers.

    This was first published in September 2007