In the World of Service, the Peso Could Cost You a Pretty Penny

0
75 views

Share on LinkedIn

You’ve read the statistics. You know that the Latino population will soon exceed every other minority group in the United States—in terms of both sheer count and (importantly) purchasing power. Has your organization decided to stake its claim on this increasing customer base? This move could be a very costly decision.

American companies began tailoring their approach to the Spanish-speaking customer by hiring bilingual contact center representatives. Is this enough to pull from the purchasing power pool? Essentially, how far is far enough?

In an effort to bring clarity to this service strategy question, Customer Relationship Metrics examined a group of financial services contact centers offering customers in-language services through its contact center network. The results of the study largely supported the decision and costs associated with offering bilingual contact center support.

Customer satisfaction (and loyalty) scores were far higher among Latino customers served in their native language compared to their English-speaking counterparts. This difference in scoring was evident in examining satisfaction with a single service event, the customer’s attitudes toward the company and the customer’s likelihood to recommend the company to others. The opportunity to be served in one’s native language resulted in an increase in Latino customer loyalty. The monetary value of this increased loyalty was understood through enhanced average lifetime value of a customer, as well as an increase in acquisition of Latino customers through word-of-mouth.



The study also revealed the cost implications of not allowing this Internet-savvy customer segment serve itself. For centers that chose not to provide self-serve options in Spanish, any question or problem experienced by a Spanish-speaking customer required a call into the contact center. As a result, a far greater percentage of Latino customers (compared to their English-speaking counterparts) required the support of the contact center network and its live agents. The result was an increase in operating costs to meet customer demand for service by an already costly workforce. Based on the average lifetime value of a customer, the increased costs severely cannibalize any benefits experienced through increased customer loyalty.

Implementing self-serve options in Spanish quickly became among the top-priorities for 2008.



A similar study was conducted with a client supplementing a bilingual contact center workforce with self-serve options to Latino customers. This study revealed a similar elevation in customer satisfaction scores assigned by Latino customers served in their native language but showed no significant difference in contact center utilization based on customer language. This second study confirmed other findings that Latino customers are just as likely as their English-speaking counterparts to use self-service options.

Service dilemma

It is projected that by 2010, Latino households may command $1 trillion in total purchasing power. Increasing Latino purchasing power and representation in the U.S. consumer market has made the capture of this market segment a very attractive proposition for many U.S. companies. Attractive and popular, yes. However, the initiative can be potentially costly.

The decision essentially comes to the pursuit of additional revenue by expanding the relationship of your existing Latino customers and finding new customers from the pool of Latino consumers. How feasible is that? The additional revenue is what is garnered by this initiative, at what cost? Servicing this customer base requires that you provide all of the functionalities, add-ons, “bells-and-whistles” and “nice-to-haves” currently in place for your English-speaking customer. The commitment to do so must include a commitment to do it well and to measure its success.

How much of the $1 trillion in total spending power is applicable to your product and service offerings? Considering the number of applicable dollars in the equation, how great is the opportunity? Once you decide that it is a strategic initiative for your organization, you must support the pursuit with an effective service strategy. The cost to implement, manage and maintain that dual-language strategy must yield a positive return.

And if you have made the plunge and embraced and implemented robust Spanish language service channels, has it paid off for you?

LEAVE A REPLY

Please enter your comment!
Please enter your name here