Back in August 2022, the Conversation Excellence Lab published a report called “How to Recession-Proof Your Contact Center, According to 360+ Executives”. That summer, The World Bank announced that most countries were headed toward a recession. For contact centers, that potentially meant that lower revenue, fewer resources, and pressure to do more with less were on the horizon.
Since then, it seems that many of those predictions have come to fruition. In January 2023 alone, over 60,000 people were laid off from their jobs. More recently, Silicon Valley Bank’s sudden collapse has been on the news, causing shockwaves of uncertainty about the stability of company finances.
In light of these developments, we’re taking another look at what we found in our August report to answer the question: How are executives approaching investment in their contact center during this time of economic uncertainty?
You Have to Spend Money to Make Money
For our report, we surveyed 361 executives across the United States, and defined executives as Directors, Vice Presidents, Presidents, and C-Suite Executives. We limited our respondents to those whose organizations contained sales, customer service, or collections contact centers.
We asked our respondents if they were planning to cut costs in the next year. Only 27.7% said yes. Despite potential economic struggles, executives saw the value in continued investment in their company.
Across respondents, the average increase in software and hardware investment per agent was approximately $5,495. The average increase in coaching and training investment per agent was $10,367.
It seems that companies are maintaining their investments in both technology and their workforce. In fact, CNBC found that 75% of senior tech leaders are expecting to spend more on technology this year than they did last year.
The truth is that if you cut your investment in your contact center’s operations — whether that be people, technology, coaching, or benefits — your contact center’s performance will suffer, and you’ll risk falling behind your competition.
The best contact centers know that the way to weather a downturn is not always to cut corners, but to see where you can create more value out of what you have (more on that later).
The Downside of Cutting Corners
The 27.7% of our respondents who said they were cutting costs this year had lower customer satisfaction and higher attrition across the board.
This isn’t a coincidence. When agents lose benefits, salary, or resources, their job satisfaction drops, and their performance does as well. This invariably affects your customer experience, conversion rates, and customer retention rates in turn.
Those who were cutting costs had the following outcomes compared to those who weren’t:
- Double the employee churn rate (44.8% versus 21.5%).
- Lower customer NPS by 5 points on average.
- Lower customer CSAT by 9 points on average.
Figure 11: Employee churn and customer satisfaction as a function of cost-cutting
Note: Responses have been converted to a 0-100 scale for comparison. E.g., CSAT of 4/5 = 80/100.
Despite a difficult economic climate, most executives aren’t cutting costs in the next year — and those who are cutting costs aren’t doing that well.
How to Create Value During Recessions
Here’s the good news: if you can’t afford to spend more money next year, there are still a couple things you can do to keep your employees and customers happy.
1: Remember that value is a self-fulfilling prophecy
We asked our respondents if they viewed their contact center as important or as a drain on resources and found that, for the most part, the results mirrored the sentiment.
Figure 7: “Drain on Resources” Agreement vs Contact Center Metrics
Note: Responses have been converted to a 0-100 scale for comparison. E.g., CSAT of 4/5 = 80/100.
Executives have a lot of cultural and operational sway. If you view your contact center as a value center, and treat it as such, that value will be realized.
But if you view your contact center as a drain on resources and treat it accordingly, morale will go down on your team, and so will performance.
2: You can create value with the resources you have on hand
Contact center agents regularly create value on calls in a number of ways, from telling customers about sales to asking for online reviews, up-selling and cross-selling to gathering customer information for marketing purposes.
While only 6.37% of respondents said their agents do none of the activities above on their calls, they also weren’t entirely confident that their agents were succeeding at the activities they were doing.
For example, executives listed “asking for reviews” as one of the most important activities for generating value on a call, but they also rated it as one of the least effective tactics that agents used.
Positive reviews build loyalty and serve as organic marketing to bring in new customers to your organization. Are your agents trained on how to best ask for them? Are they trained on how to up-sell and cross-sell your core products appropriately, and use each call as an opportunity to generate value?
Nearly 20% of our respondents said their companies did not provide dedicated training for value-add activities. Make sure you’re not in that 20%: if you don’t have the resources to invest in your contact center this year, the activities and tactics above are a proven way to unlock new value.