What Is Domestic Outsourcing In Customer Service?

Providing excellent customer service in competitive markets can be a key differentiator. Yet, how to do so involves many considerations. For example, deciding whether to operate your own customer service function, outsource to a domestic supplier, or even offshore your provision is not a black and white question.

For most businesses two primary factors – costs and quality - drive how to choose the most appropriate care for their customers.

In recent years, offshoring customer service has become a popular way to save money. However, domestic outsourcing remains the best option for providing an optimum experience at a cost-effective price.

As well as benefitting from localised expertise, companies are afforded greater freedom to focus on other core activities.

The following breakdown explains what a customer-focused business should do to leverage domestic outsourcing and provide the best possible service.

In this article, we cover:

• What is domestic outsourcing?

• Examples of domestic outsourcing in customer service

• Benefits of domestic outsourcing your contact centre operations

• Domestic outsourcing vs offshoring

• What to consider when selecting an outsourced partner

• How Whistl Contact Solutions delivers real results

What is domestic outsourcing?

Domestic outsourcing, also known as onshore outsourcing, is a form of Business Process Outsourcing (BPO) in which a third-party manages one (or more) of a company’s core functions from the resident country.

In the context of customer service, this will involve an outsourced partner assuming responsibility for the essential elements of relationship management, including contact centre support.

As part of the service, companies gain access to a local talent pool and can provide the selected provision in-country rather than in a neighbouring country (nearshoring) or further overseas (offshoring).

The practice of outsourcing is well established. In the UK alone, 48% of companies outsourced work in 2023, with an increase of 41% since the Covid-19 pandemic.

Meanwhile, according to the CCMA’s Contact Centre Outsourcing Report 2023, around 60% of enterprise firms across Western Europe, North America, Japan and Australia have a relationship with an outsourcer. The same proportion of organisations utilise outsourcers to manage some of their Customer Experience (CX). This is perhaps not surprising given the inflationary pressures and rising costs UK businesses currently face. In attempting to mitigate these challenges, many have turned to domestic outsourcing to maintain a good balance of customer service quality and productivity, whilst still saving money in a tough economic climate.

Examples of domestic outsourcing in customer service

A domestic outsourcer will typically offer a suite of services designed to enhance the entire customer experience. One common method is inbound call handling, managed by experienced agents familiar with a broad range of customer queries. This can also be expanded to outbound call centre services, which involves telemarketing and reaching out to sales prospects to set appointments.

However, the modern contact centre offers more than call handling. Customer experience is managed through a flexible and well-equipped team capable of handling many different activities.

Other examples include:

• Data capture and market intelligence services that ensure compliant customer data handling. This can also include market research, surveys and customer re-engagement activity such as forward address tracing, telephone and email connectivity validation.
• Multichannel contact centre support that encompasses calls, emails, mobile or website chat, and social media handling.
• Omnichannel contact centre support features similar components to multichannel support but with the addition of advanced data continuity tools. An omnichannel solution allows a customer to interact with a company across all channels without raising a new query if they switch media platforms.
• Bureau call centre handling with flexible pay-per-contact pricing, ideal for companies that have low or variable contact volumes. A bureau call centre is particularly appealing to businesses that experience seasonal fluctuations.

Benefits of outsourcing your contact centre operations

Why outsource in the first place? As mentioned, cost savings and access to expert knowledge are two key benefits of onshore outsourcing. Because freeing up time and reducing outgoings - while improving business performance – will always be no-brainer.

But what does this all mean beyond headline statements?

Entrusting your customer care with a third-party is a considered decision, but a quick glance at the holistic benefits demonstrates the potential pay-off.

Benefits include:

• Reduced costs and economies of scale can have a massive impact on both your bottom line and the customer experience. Running your own contact centre requires huge investments in people, facilities, and technology whereas a domestic outsourcer already has access to these vital components. Furthermore, an outsourcing partner will spread their fixed costs over a broad client base, enabling them to pass on savings.
• Improved insights and business performance go together with outsourcing. An external supplier can provide data from customer interactions to improve your product and service offerings.
• Engagement best practice is an invaluable part of the outsourcer’s toolkit. By combining data analytics with honed techniques for better engagement, sales and retention, a third-party can optimise the customer experience.
• Mitigated business risk is an essential by-product of an outsourced agreement. A supplier’s flexible pricing, scalable resource models and multiple sites provide reassurance on costs and business continuity.
• Enhanced technology creates better customer interactions. Accessing an outsourcer’s technology stack and infrastructure is likely far more cost-effective than establishing and managing new services from scratch. Whereas a third-party will be ready to provide a range of traditional, digital, and self-service communication solutions right from the implementation stage.

Domestic outsourcing vs offshoring

The UK’s strong customer service background and stability make it an obvious choice to consider for your service provision.

However, domestic outsourcing providers cannot afford to be complacent. According to the 2023 Front Office CX Omnibus Survey, India and South Africa are the top-ranking offshore CX delivery destinations with both highly favoured by British management professionals.

In deciding which route to take, let's examine the differences between onshore and offshore outsourcing and their respective benefits.

Onshore (domestic) outsourcing has several advantages to UK-based businesses, such as cultural familiarity, alongside reduced language and time zone barriers. It’s also worth looking at some hidden costs of offshoring vs domestic outsourcing. The financial cost to redeploy operations, as well as a potential loss of customer intimacy and longer customer service times, can all negatively impact your CX. From a security perspective, some businesses may be wary of transferring sensitive information to a third-party in another country.

However, the relative popularity of offshore outsourcing cannot be ignored. In today’s digital economy, roles can be performed from locations with access to skilled talent and the relevant technology. Businesses can also choose to take a hybrid approach, whereby in-country teams are supplemented by agents in other parts of the world. This enables companies to offer round-the-clock customer service.

Weighing up which option to choose is dependent on numerous factors beyond costs. For example, if you’re a UK-based business with a predominantly local customer base then onboarding and overseeing a ‘home’ customer service function has many benefits over offshoring.

Domestic outsourcing vs offshore outsourcing

What to consider when selecting an outsourced partner

When you’re procuring the services of a customer service outsourcer you should consider several essential steps before signing on the dotted line.

The process should begin by clarifying your requirements and seeking internal alignment on your goals (especially if this is your first-time working with a contact centre outsourcer).

It may be tempting to approach this exercise with the sole purpose of reducing costs. However, this is short-sighted and unlikely to translate into transformative business outcomes.

There will be plenty of other checkpoints from here. Strategy sessions, presentations, Q&As and site visits are some of the stages you’ll need to navigate before getting to the agreement stage. Ultimately, you should be looking for evidence of capability and service quality throughout the procurement cycle.

5 top considerations:

• What are you looking to achieve from an outsourced agreement?
• Does your preferred organisation have access to the right people and technology?
• Can your prospective partner provide evidence of exceptional service?
• Does the outsourcer have the flexibility to scale with your business?
• Can the partner demonstrate high levels of integrity and strong governance?

How Whistl Contact Solutions delivers real results

Whistl Contact Solutions continues to exceed expectations for businesses that have complex requirements, demanding customers and challenging objectives.

Our relationship with The Noble Collection has spanned over 16 years with our inbound call bureau service the perfect fit for their requirements. The Noble Collection is a licenced manufacturer, distributor and retailer of film and TV properties, including the Harry Potter, Fantastic Beasts and Game of Thrones franchises.

When new films or series are released, there is huge interest in related merchandise. To cater for this fluctuating demand, we provide a full range of peak-time customer service solutions, at flexible pay-as-you-go rates.

Similarly, our award-winning partnership with Micro Scooters enabled this eCommerce success story to scale-up their customer service operations effectively. As well as managing delivery-related enquiries, we’ve provided overflow and out-of-hours call handling.

Our forward-thinking solution also focuses on updating self-service options, such as frequently asked questions (FAQs) with targets set to minimise the number of customer enquiries we receive.

Want to know more about why you should choose Whistl as your outsourced customer service partner?

Get in touch to find out more about how your business can benefit from a tailored approach delivered by professionals who care about your customers.