Customer service BPO: What is it + do you need it?

A great customer service team can help a business take flight by winning and retaining client loyalty, but bad service experiences can throw it into a tailspin. According to the Zendesk Customer Experience Trends Report 2023, over 70 percent of customers want immediate service. So, if you can’t pledge to build and maintain an effective service team, you may want to hand these tasks over to a specialist.

Customer service business processing outsourcers (BPOs) can help businesses soar by providing customer service coverage and expertise that help organizations build and retain customers. In this article, we dive into BPOs: what they are, their benefits, and how they can contribute to an outstanding customer experience (CX).

More in this guide:

• How do customer service BPOs work?
• Benefits of working with a customer service BPO
• Limitations of BPOs
• Frequently asked questions
• Zendesk can help your customer service team

How do customer service BPOs work?

Customer service BPOs work on an outsourcing model. If a company can’t manage its customer service interactions effectively, it can reach out to a customer service BPO that can provide customer service support on the company’s behalf.

Customer service BPOs can perform many CX roles and functions:

• BPO call centers: BPOs can function as a call center. These teams of support agents can handle inbound calls to address customer questions and outbound calls related to telesales or market research.
• IT help desks: BPOs can help with the technical side of customer service, familiarizing themselves with a company’s offerings and assisting customers with product issues or bugs.
• Omnichannel customer service: Businesses often interact with customers via various mediums like chat, email, and social media. BPOs can help provide a connected and consistent communication experience.

Today’s businesses need agile and comprehensive customer support to stand out in the marketplace—if not, consumers will look for other options. According to our CX Trends Report, 73 percent of consumers will switch to a competitor after multiple bad experiences. If an organization is short-staffed or unable to keep up with customer interactions, hiring a customer service BPO may be wise.

When selecting a provider, it’s important to know that BPOs typically come in three models: onshore, nearshore, or offshore. This means businesses can choose to partner with a BPO that uses domestic employees, employees from a nearby country, or employees from a distant country.

Benefits of working with a customer service BPO

There are several benefits of using BPOs for customer service outsourcing. Here are seven of the most impactful ones.

1. Access specialized expertise

A customer service BPO has a wealth of specialized expertise that businesses can leverage when their current customer support falls short. Customer service BPOs are experts in managing and scaling customer support teams and can bring industry-specific knowledge to the table, ensuring customers receive accurate and informative service for their queries, concerns, and technical issues.

BPOs understand customer service processes, help create staffing plans based on your growth projections, and use queuing models to optimize your team’s schedule. Most importantly, if your customer service performance isn’t meeting your goals, BPOs can dive into your operational data, like customer satisfaction (CSAT) and first reply time, to identify bottlenecks and improve your overall CX.

2. Minimize hiring and HR headaches

When an organization manages its own customer service team, it has to focus on more than just the consumer. Businesses must recruit and train support agents, budget for compensation, manage their performance, handle their turnover, and more. This may not be the best use of a company’s time or limited resources.

With customer service BPOs, many of those internal headaches go away. Since BPOs bring their own proficient, fully trained team to the partnership, organizations can eliminate most staffing concerns and prioritize core business activities.

3. Gain staffing flexibility

Business needs can fluctuate, and customer service BPOs have the flexibility to upgrade or downgrade staffing needs on the fly. Say, for example, a business is approaching a busy season. BPOs can ramp up support in a flash to ensure the CX remains strong even with an increase in call volume.

This flexibility also extends to support hours. BPOs that offer nearshore or offshore operations can help businesses serve international customers by providing support when your in-house team is off the clock. Additionally, BPOs can handle multiple communication channels—from phone support to social media—and remain available to your customer base, no matter the medium.

4. Reduce costs

Outsourcing customer service can result in substantial cost savings. If you employ support agents in your home office, you’ll need to factor in additional office space, equipment, training costs, and other expenses to get them up to speed.

Customer service BPOs can help eliminate that cost because they already have established infrastructure and operational efficiencies. This enables them to provide high-quality support at a lower cost as opposed to building and maintaining an in-house team—all you need to worry about is BPO onboarding. Additionally, you can often save more money if you partner with an offshore BPO that utilizes international agents, which can be a great option for organizations looking for multilingual customer support.

5. Improve customer service metrics

Customer service BPOs assist and improve your operations by focusing on metrics. They are experts in managing and scaling customer service teams and understand customer service key performance indicators (KPIs) like first contact resolution, first reply time, CSAT, and more.

Additionally, if your performance isn’t meeting your goals, BPOs can investigate and take action on your behalf, offering and implementing new processes to better hit your benchmarks.

6. Increase customer retention and loyalty

When customers consistently experience excellent customer service, they are more likely to make repeat purchases with a business and become loyal customers. According to our CX Trends Report, 3 in 4 consumers will spend more with businesses that provide a good CX.

Customer service BPOs bring expert customer service to every support interaction. This means your customers are more likely to be impressed with your brand and stick around long-term.

7. Enhance your business reputation

The rise of e-commerce has ushered in a myriad of review platforms, like Google reviews and G2, that many consumers visit before making a purchase. Businesses that provide outstanding consumer interactions time after time will build a positive reputation—one that consumers all over the internet will take notice of.

Customer service BPOs excel in the type of professional, responsive, and quality service that gets customers talking. Businesses that partner with BPOs can quickly develop notoriety for providing an excellent CX.

Limitations of BPOs

While BPOs offer plenty of benefits for both business-to-consumer (B2C) and business-to-business (B2B) customer service teams, they aren’t all sunshine and rainbows. Here are a few drawbacks businesses may encounter when weighing a BPO approach to customer service.

Less control of customer service operations

When a third party handles customer service interactions, businesses naturally have less control over day-to-day operations. Even though there is frequent communication, BPOs work independently, and organizations may have less direct oversight of how BPOs handle customer inquiries. This can be a concern for businesses or call centers that prefer to maintain control over their messaging.

Disadvantageous for small businesses

BPOs can be very cost-effective for medium and large operations, but they may not always be suitable for businesses with limited resources. Smaller businesses may struggle to find a BPO pricing structure that fits their needs, or they may not meet minimum call volume requirements. If you’re getting just a few customer queries a week, it may be best to designate a team member to handle them.

Not a good fit for regulated industries

Companies in regulated industries like healthcare or finance may not be a good fit for BPOs due to laws regarding customer and product information. These industries often demand strict data security, compliance, and confidentiality measures, meaning only certain certified staff can discuss sensitive information. In these cases, BPOs may not adhere to the regulations or perform effectively enough to be worth it.

Frequently asked questions

Zendesk can help your customer service team

Customer service BPOs can be the wind at an organization’s back, helping them fly toward their customer service goals. Whether you’re a business seeking to upgrade your customer support or a BPO looking to improve your operations, partnering with a trusted and experienced CX software provider is crucial.

At Zendesk, we provide a comprehensive customer service solution that helps in-house and outsourced teams stay flexible through change and create meaningful connections with their customers.

Try Zendesk for free today to improve support interactions and build long-term customer relationships.