Profitably Routing Calls to a Low-Cost Call Center
The CompanyA large, consumer-facing services provider with a significant call center operation with both inbound and outbound calling
The ChallengeIn an effort to reduce costs, management decided to outsource perceived lower-revenue opportunity calls to a low-cost call center and needed to understand the profit impact. However, use of conventional analytical techniques was not successful in determining the profit impact of the program. They knew that they needed to find a new way to understand whether the cost decrease was sufficient to offset suspected reduced revenue.
The SolutionThe organization turned to APT to help isolate the cause-and-effect relationship between outsourcing calls and profits. Test & Learn™ software showed that, on average, routing customers to a lower-cost call center significantly reduced average revenue per user by more than 25%, a decrease too large to overcome the benefit of lower costs. Accounting for cost savings, the company was losing about one dollar per call. Additionally, customers whose calls were outsourced also exhibited lower customer satisfaction scores. However, by de-averaging the results, APT showed that low-cost call centers could profitably service select customers and select call types, in which cases the revenue per call impact was marginal.
The ResultsManagement decided to redirect the majority of calls from the lower-cost call center back to the internally operated call center, increasing annual profits by over $15MM.
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