By Andy McCue, 11 May 2004 17:25
NEWS One in seven UK customers who used an offshore call centre in the last year protested by taking their business to rival firms, according to new research out today.
A survey of 1,000 UK adults in February found that 142 switched supplier because their existing one used an offshore call centre, while three-quarters said they felt more negatively towards their supplier if they used offshore agents.
The report by call centre industry analysts ContactBabel also found that customer defections were highest in the telecoms and insurance sectors and that Scottish people were most likely to switch supplier.
The spectre of a consumer backlash against perceived job losses to places such as India has so far been dismissed by the offshore industry as skewed and politically motivated by a vocal minority.
But the report warns that only a small percentage of customers switching supplier in protest at offshoring will offset any economic gain from moving operations overseas in the first place.
In a hypothetical scenario, the report calculates that a typical high street bank with 12 million customers and revenues of £225 per customer each year would save £9.26m by replacing 1,000 UK call centre workers with the same number in India.
The report claims it would only need 0.343 per cent of customers still over 41,000 people - to defect in protest to cancel out those savings, and that last year 1.09 per cent of UK banking customers changed supplier as a direct result of customer service offshoring.
Steve Morrell, principal analyst at ContactBabel, said in the report: "If UK businesses do not address the concerns of their customers, the level of customer defection will increase and their profits will decline further. Offshore contact centres certainly have a future role to play in providing service to UK customers, but they are a piece of the jigsaw, not the whole puzzle."
Comments
There are 15 comments. Join the discussion
1. Keep Jobs in the UK
Offshoring does NOT benefit customers. Good on the Scots for abandoning companies using offshore call centres! The argument usually given for offshoring is that is saves operating expenses, a savings that is passed on to consumers. Rubbish. Your cost of dealing with that service (insurance company, bank, et al) may not go up, but NEVER have I had ANY organisation pass on ANY savings due to offshoring. More power to the consumer. Vote with your feet. VOW never to knowingly do business with a company that puts vital UK jobs offshore. When you seek a new supplier (bank, insurance, etc) ASK if they use an offshore call centre - those calls are recorded - if they lie, you could have a breach of contract case and get your money back. Thanks to silicon.com for noting Shell and HSBC as offshoring - I shan't be using them anymore. Also, don't use Norwich Union Direct (insurance)- they also use a (USELESS!) offshore call centre. Anybody know of a website blacklist of companies with offshore call centres?
2. anonymous
When I want detailed and accurate information from a Company, I need it delivered by people whose accents I can understand and who know the subject matter.
I want good Engish speakers and although I am just about willig to accept a broad Scottish or Irish regional accent, the English language from Indian and Phillipine nationals is totally unacceptable.
My remedy: Any Company that routes me to an offshore call centre instantly loses my account.
3. John Bend
I declined to use Norwich Union for car insurance despite a saving of 20 UKP because their call center is overseas. Instead my business went to Direct Line who assured me that their call center is here in the UK.
This is a very small thing we can all easily do to protect our own futures. At the very least you must ask yourself if your personal data is truly safe if not fully governed by UK data protection laws?
As a tax payer I would even suggest that corporations who choose to "offshore" for financial reasons should face a tax or levvy.
4. anonymous
Offshore = Poor service = customers buy elsewhere, or buy a different product. As an IT Manager we stay away from firms that use far away call centers IF the centers have poor connections, poor english and they read support scripts.
We've have changed 5 suppliers (Dell) included in the last 2 years.
5. Martyn Kinch
Agree. I switched from Norwich Union because I kept getting India based call centeres. I think it is wrong, and the company that just answers the phone (without automated call handling) in the UK gets my vote and business every time. (Direct Line get all my insurance because they do exactly that)
6. anonymous
A consumer site detailing which UK companies that want UK business and have gone offshore is needed so we can all support this as I am sure companies will try and keep it quite.
7. Ruprecht
I wonder how this will be reflected in the BBC's Brassed Off Britain series?
Everyone hated British call centres before they moved to India, now we love 'em, cos "they don't have funny accents"...?
UK Call Centre = Crap Service from someone incapable of/can't be bothered using the systems available to them.
Offshore Call Centre = Crap service from system available to people who would actually like to help if they could.
I recently had dealings with the Accenture call centre in India running a large banks recently outsourced accounts payable operation. Very helpful guy, crap phone line and a cock-up on the system in the UK stopping my invoice being paid.
8. Gordon Rees
Eagle Star/Zurich have lost both my car insurance and home contents insurance this year due to my not getting informed responses from the ofshore call centre.
9. anonymous
I recently bought a Dell computer for personal use using their Indian call centre - The experience was so bad I will never use them as a corporate supplier. Poor language skills, inability to do anything other than read from the screen and slow response times being some of the main issues. Very poor.
10. margaret walker
Why Offshore when there are numerous outsouring companies WITHIN THE UK who can offer a QUALITY service (the majority of customer service executives working for outsourcing companies have previously worked for call centres anyway) and who will work in partnership with companies and view client's customer's as their customers. This leaves companies free to focus on customer growth and above all keeps the work in the UK. From a company point of view this MUST be easier to manage the contract!
11. Matt
I think that some of the views seen here show extremely narrow minds. If the job gets done correctly then what is the problem? Also I know of jobs that couldn't be filled in this country so what option does the company have?
12. Barry Gallagher
I have done exacly the same. Norwich Union call centre staff have terrible english and it makes it hard work to try and have a simple communication with them. I too have switched companies as I think the service is a disgrace not to mention more expensice than some of its competitors. NU - Big mistake.
13. james bruce
Norwich Union call centres are very poor!
I think it is unacceptable for the company to put the people in the offshore company in the position, all they get are disgruntled customers who can not communicate effectively with them, as they are speaking a second language! It makes me stressed and unhappy, god only knows how the staff must feel?
I will no longer be renewing new business with them, instead opting for a company who do not use this practice.
LIFE IS STRSSFULL ENOUGH AS IT IS WITH OUT OFFSHORE CALL CENTRES!
14. Robert Haddock
I have no hesitation in moving my business from companies who offshore their call centre. My experience is their is absolutely no benefit and the service is actually far worse. I have a hearing loss and dealing with some staff in offshore centres is a a stressful and nightmarish expereince for me. While as consumers we all want as much as possible for the lowest cost possible I for one would be willing to pay slightly more to keep jobs and service "on shore".
15. anonymous
I feel exactly the same as your findings.
Dont understand why banks dont do much more research as to what WE want instead if what they want and how much money to make. TSB is my bank at present, but not for much longer. Shame really because Ive banked with them for 35 years! but hey, Im just a customer.