Having overcome the pandemic-incurred decline in the workforce, the global call center market is expected to surge as a customer service powerhouse, conquering an impressive $500-billion threshold by 2027. With customer calls remaining critical to the conversion journey, it’s crucial to align your call center with the needs and wants of your callers, however whimsical they might sometimes be.
From simple information requests to complaint resolution to sales, a modern call center must solve the full spectrum of goals while guiding callers toward a purchase.
- A call center is no longer a place where operators simply take calls but rather an all-encompassing business hub for collecting and interpreting caller data into profitable marketing decisions. Whether on-premise or cloud-based, your call center must unlock caller, call, and marketing data.
Your call center is as good as the insights it provides.
To fully comprehend the value of a call center and whether you need one in the first place, you need to understand what a call center is, how it operates, and what specific business advantages it uncovers.
You’re in for a treat: below is your exhaustive guide to a call center business.
Let’s make a foray into the multiverse of call centers so you can get a crystal-clear idea of a call center and whether you need one.
What Is a Call Center?
Converting up to 15 times more users than web interactions, phone calls are a goldmine for online businesses. At least 30% of consumers contact brands using phone calls, with some industries relying on calls even more heavily — around 75% of insurance seekers book their policies by calling.
- A call center is an on-premise or virtual office for handling incoming and outgoing customer support and sales calls. Depending on the complexity, call centers range from basic to the most sophisticated with advanced functionality and integrations.
While an entry-level call center may only include basic telephony systems, its advanced counterpart may run state-of-the-art call center software and integrate with countless third-party call management tools, creating a comprehensive ecosystem for calls, clicks, and other marketing activities you can measure and improve.
Want to know more about call center technologies? Give this read a try.
Luckily, today’s market has it all and then some for you, from traditional call centers to economical virtual solutions like Cloud PBX that provide the best of both worlds for only a fraction of the price. The world is your oyster – all you have to do is understand what you need.
On-Premise vs. Virtual Call Centers: Which One Do You Need?
By no means is choosing a call center for business easy.
You have two major options:
- On-premise call center: To commit to an on-premise call center, you must envision your call center environment, purchase relevant call center equipment, and hire and train customer service agents, among many other things (not to mention you must possess a budget of a few hundred thousand dollars).
- Cloud-based call center: Cloud-based phone systems like cloud PBX are a win-win. Not only are virtual call centers superior in features, but they only cost a few hundred dollars a month, posing minimal financial risks. If you decide to close your call center company, you won’t have to spend months finding a buyer for your costly and unique equipment.
On-Premise vs. Cloud-Based Call Centers
| On-Premise | Cloud-Based | |
| Ownership | Full ownership | Rented from a provider |
| Features | Theoretically unlimited set of features, yet limited by initial design | Wide range of ever-updated features |
| Integrations | Subject to infrastructure limitations | Unlimited integrations with CRM systems and lead management solutions |
| Scalability | Requires infrastructure upgrades | Requires switching to a new subscription plan |
| Maintenance | Handled by an owner | Handled by the provider |
| Security | Ensured by an owner | Ensured by the provider |
| Price | Starting from a few dozen thousand dollars | Starting from $100 a month for the fullest software package |
On-premise call centers mostly suit large businesses with the resources for hardware, licenses, and customer service representatives. You will likely need at least a few hundred thousand dollars to set up a fully-fledged on-premise call center.
But why even commit if you can get a better infrastructure for mere pennies?
Cloud-based call centers surpass their predecessors in many dimensions, propelling online businesses of all sizes. For example, Phonexa’s business phone system Cloud PBX is available starting from $100 a month, with free inbound calls, and outbound calls costing $0.01 to $0.1 per minute.
Are Call and Contact Centers the Same?
Before we proceed to the types and features of call centers, let’s mention that call centers and contact centers are not the same, although these terms are often used interchangeably. This is partially done for SEO purposes — businesses are so eager to improve their rankings by both terms that they prefer to equate them.
In reality, though:
- Call centers only handle inbound and outbound calls, whereas contact centers process all types of communication, including email, text, SMS, and more. Not every call center is a contact center, but almost all contact centers handle phone calls.
Types of Call Centers
| Inbound | Focused exclusively on incoming calls, an inbound call center can guarantee high-quality service and even be the only solution for some service and subscription-based businesses. More often than not, though, inbound call centers complement a bigger inbound-outbound call ecosystem.
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| Outbound | Like inbound call centers, outbound call centers only handle a single type of call. Whether a customer needs a callback, follow-up, or guidance, an outbound call center is designed to help and trigger or cement the purchase if possible.
But then again, it’s hard to imagine a business that only does outbound calls. Most outbound call centers are not conclusive solutions. |
| Blended | Universal and versatile, blended call centers utilize integrated call management systems, allowing operators to switch between calls. Likewise, you can customize your call distribution tree, implement solutions like interactive voice response (IVR), and transfer data in real time to your call center employees. Learn why IVR is a must-have technology for your call center. Advanced blended call centers unlock the caller’s persona before the call, increasing the conversion odds. As a result, you can grow your bottom line effectively and adjust call campaigns on the fly. |
| Customer service | Resolving requests and providing guidance and assistance, customer service call centers avoid a “hard sell” approach at all costs to inspire a sense of genuine care. Customer service call centers increase customer loyalty while addressing the caller’s needs and wants.
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| Automated | Automated call centers handle calls without human intervention, relying on self-service options and technologies like IVR, speech recognition, and chatbots. Automated call centers enable round-the-clock availability and reduce call load. In most cases, though, the human touch is needed: most automated call centers still enable a switch to a live operator alongside self-service options. |
| Omnichannel | Omnichannel call centers are, in fact, contact centers that, on top of calls, also process social media, live chat, text, SMS, app communications, and more. They ensure an integrated and personalized user experience, which is quite valuable in an age when 79% of people switch devices during a single online session.
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If you need a cloud-based omnichannel call center that embraces automation features like IVR, automatic call distributor, call forwarding, call transfer, caller ID, and more, there’s no way around it. To convert more callers, you must make them happy. To make callers happy, you need to know who they are, what they need, and what you can offer them that your competitors can’t.
How a Call Center Works: Three Crucial Steps
Whether a sales or customer support call, chances are it undergoes three key stages:
- Initiation
- Distribution
- Conversion
Let’s review these stages briefly so you can understand how a call center works.
Step 1. Call Initiation
First things first. Customers dial one of your business numbers to initiate a call, giving you immense room for real-time and post-call tracking and analytics.
- By strategically placing call tracking numbers across your traffic sources, you can collect exhaustive information on the caller before the call and transfer it immediately to a live operator that handles the call.
Explore call tracking in detail in this definitive guide on call tracking.
Step 2. Call Distribution
Source: Phone System for Small Business – What Is It and Why You Need It
As a caller dials your phone number, your call distribution system kicks in to route them to your IVR system, voicemail, or a sales/customer support operator. Routing callers is a double-edged sword, though. On the one hand, you want to collect the maximum information on callers. On the other hand, you don’t want to bombard them with excessive questions.
- Well-thought-out call routing is crucial to retain callers. According to the Talkdesk Report, the average call abandonment rate is 5.91%, with around 30% of abandoners being first-time callers.
At the same time, it’s important to allow callers to choose their interaction channel, enabling omnichannel experiences across all touchpoints. In fact, 76% of customers want to be allowed to pick their preferred interaction channel and freely switch between communication media.
Wonder how call routing works? Spend 20 minutes to unlock the power of call routing.
Step 3. Call Conversion
Finally, whether through the call center’s IVR or directly, the caller is connected to a customer support rep who already knows the caller and how to solve their problem.
- Knowledgeable sales agents are more likely to satisfy callers.
Upon the conclusion of the call, the relevant data is added to the analytics data pool so call analytics software can re-interpret patterns and update your marketing, sales, and customer service department on the changes.
Wonder whether call analytics is a good match for your business? Here’s how you can maximize your business potential with call analytics software.
Source: Phone System for Small Business: What Is It and Why You Need It
How To Understand Whether You Need Cloud Call Center Solutions
Your call center model doesn’t necessarily have to revolve around a dedicated call center, as there are at least three alternatives: direct phone lines to every department, a receptionist or front desk member, and a callback system. But then again, nothing beats dedicated technical support call centers in the quality of support and depth of caller insights.
- According to Invoca Digital Marketing Report, 65% of customers prefer a phone call to an online form, having an incredible 30% to 50% conversion chance. Phone calls convert times more customers than any other communication channel.
Having a dedicated call center is beneficial all around. For only a few hundred dollars a month, you can revolutionize your customer services and sales by learning about your customers and customizing your services.
5 Signs You Need a Dedicated Call Center
| Lack of caller data | You can’t generalize your callers unless you want to lose a significant portion of them. As per Zendesk CX Trends 2023 Report, 70% of customers spend more with companies that offer a personalized and seamless customer experience. From call tracking to IVR, modern call centers have multiple tools to uncover actionable caller insights, such as demographics, location, history of requests, and more. |
| Too many concurrent calls | There are only so many calls your call center representatives can process manually. Even dedicated tech support at call centers heavily relies on IVR to solve requests and qualify callers. |
| Clogged voicemail | With only around 4.8% of users responding to voicemail, sending too many callers to voicemail is not the best idea either. A good old heart-to-heart conversation is still King. |
| Abnormal call duration | Short or long calls usually leave a caller dissatisfied: either you quickly give up on the caller, or you drag it out while searching for answers. In both cases, a dedicated call center that relies on call center metrics rather than guesswork can help. |
| Compliance Requirements | In some industries – healthcare, finance, telecommunications, etc. – running a dedicated call center is mandatory. Here are some related regulations:
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Source: Dialogtech
Top Features of a Professional Call Center
When it comes to calls, time is of the essence. According to HubSpot, 90% of customers want an immediate response, which is less than 10 minutes for 60% of them. On a similar note, Zendesk has established that 54% of consumers expect they won’t have to answer the same question twice, seeking omnichannel experiences.
As over-pampered as today’s customers might seem, you still have around five minutes to satisfy their cravings: the timespan of an average phone talk. For that, you need an advanced call center packed with tracking, distribution, and analytics features.
Below are the seven cornerstone features you might need within your cloud phone system.
1. Interactive Voice Response (IVR)
As the number of voice assistants grows – Statista forecasts 8.4 billion digital voice assistants by 2024 – callers are getting increasingly comfortable with technologies like IVR.
- For callers, IVR enables precise routing or independent request resolution.
- For businesses, IVR collects caller data and qualifies callers to a matching live operator.
Learn how professional voice recording for IVR can elevate your call center.
2. Automatic Call Distributor (ACD)
Working hand-in-hand with an IVR system, an automatic call distributor (ACD) routes callers based on collected data and the expertise of a live operator on the other end.
A typical call center’s ACD supports call forwarding and call transfer, so callers can get the second-best option if a specific customer call center is currently offline or the primary customer service representative is a bad match.
Explore how ACD can help you route calls.
3. Caller ID
Displaying your phone number or name on a caller’s device upon a call is a surefire way to familiarize the caller with your brand. At the very least, caller ID will reaffirm to your callers that they are dialing the right number and department.
Source: HubSpot
4. Call Routing
Arguably the most important aspect of your business, call routing defines how fast your callers get to the destination point and whether their journey is frictionless. According to the Microsoft Global State of Customer Service Report, 58% of consumers will abandon a business with poor customer service. On a similar note, consumers rank issue resolution as their top priority.
The good news is that you can design any routing and distribution system based on your unique business criteria and customer data like demographics, psychographics, history of interactions, agent availability, performance, location, and more.
Your basic call routing system may look as follows:
Of course, you may not limit yourself to basic automatic call distribution but employ sophisticated technologies like speech recognition and natural language processing, or you can combine objective and intelligent routing.
Here is more about how to set up a phone system and route inbound calls for a small business.
5. Call Forwarding
Call forwarding – auto-redirecting calls to another department or call center office under predefined criteria – may be your best contingency feature if your business can’t operate uninterruptedly round-the-clock at all times and locations. A well-thought-out call forwarding architecture will improve the balance between your offices and departments.
The best part is that you can choose which calls to redirect where. For example, you may limit the number of concurrent calls your primary office can take, redirecting the rest to a secondary office.
6. Call Transfer
If call forwarding redirects a caller before the call, call transfer does it midstream. Whether a call was directed to the wrong officer, department, or agent, the latter can transfer the call on the fly without the need to redial.
In fact, customers hate recalls even if they are the ones being called. According to the OECD Global Recalls portal, some industries face a recall response rate as low as 3%.
7. Number Portability
Among business phone numbers, some are portable and some are not. Make sure your numbers are portable if you want to keep them when expanding locations or switching providers. With unportable numbers, though, you will nullify brand recognition every time you are forced to abandon your numbers.
Get the latest update on how virtual business phone numbers work.
How To Measure the Performance of Your Call Center
| Average Speed of Answer (ASA) | ASA is the duration of a call queue – how long your callers must wait before an operator answers the call – excluding the routing time and the time spent interacting with your IVR. ASA rates lower than the average of 28 seconds usually translate into satisfied customers and better agent performance. On the other hand, waiting for longer than a minute will force most callers to abandon the call. |
| Average Handle Time (AHT) | According to HubSpot, an effective call must last four to ten minutes, the time needed for an operator to qualitatively handle a request. At the same time, the average ATH gradually declines as call agents get caller data before the call. |
| First Call Resolution (FCR) | Resolving the call on the first try is how a well-oiled call center must operate. The average call resolution rate hovers around 70%, varying slightly by the industry:
Unlike AHT, FCR is expected to grow over time as more customer support and sales reps get caller insights in advance. |
| Hold Time | Callers hate being put on hold – as per Dialogtech, 15% of them will abandon the call after 40 seconds of waiting – but you can’t escape it. As powerful as real-time data transfer is, sometimes your operators need extra time to process the request or even transfer the call. The average hold time is 56 seconds, with small businesses keeping their callers on hold two times longer – around 107 seconds – and medium-sized companies boasting a lower hold time of 39 seconds. |
| Call Transfer Rate | Switching departments or operators midstream is another inconvenience you can’t avoid. Some research indicates that up to 10% of all inbound calls are transferred, with a typical caller transferred at least twice before the issue is resolved. Naturally, you should try to place your calls correctly in the first place. |
| Abandonment Rate | Poor call quality, complex IVR, or irrelevant call center manager may force a caller to hang up, growing your abandonment rate. According to HubSpot, The average call abandonment rate is between 5% and 8%, with some industries suffering more than others:
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| Customer Satisfaction (CSAT) | CSAT estimates how happy callers are with their call center experience on a scale from 0 to 100. The average CSAT is around 80, with only a handful of businesses surpassing 85. |
Source: Dialogtech
Why Is Cloud PBX Your Best Solution for Calls?
Leveraging the VoIP technology, cloud PBX can take your call center to the next level through:
- Data-driven call routing
- Near-infinite scalability
- Detailed call scoring
- Real-time data transfer
- Integrations with CRM and call management solutions
Virtual phone systems like Phonexa’s Cloud PBX are integrated solutions with built-in redundancy and multiple contingency mechanisms that ensure uninterrupted service round-the-clock and dig deep into caller data.
Make Your Call Center Work to the Fullest With Phonexa
A successful call center is an integrated one. Phonexa’s all-encompassing marketing software suite features eight proprietary solutions for clicks and calls, making up a winning automation mix for calls, clicks, email, SMS, and other communications.
Starting from only $100 a month, you get access to eight customizable solutions at once:
- Cloud PBX – cloud phone system
- Call Logic – call tracking and distribution
- LMS Sync – lead tracking and distribution
- Lynx – click tracking
- E-Delivery – email and SMS marketing
- HitMetrix – user behavior recording and analytics
- Books360 – automated accounting
- Opt-Intel – suppression list management
Upgrade your call center now or schedule a consultation to learn more about Phonexa.
Frequently Asked Questions
What is a call center?
A call center is a specialized unit – on-premise or virtual – for handling inbound or outbound customer phone calls. Modern call centers utilize a vast range of technical features and integrations, including integrating with CRM software, lead management systems, and other call tracking and analytics tools.
Are call centers the same as contact centers?
Contact centers are a broader term than call centers since, in addition to handling phone calls, they handle text, email, and SMS communication. However, these terms are mixed so often that even renowned sources use them interchangeably.
How do call centers work?
Whether on-premise or cloud-based, call centers rely on three key components:
- Hardware
- Software
- Network infrastructure
The technical components of a modern call center can include telephony systems (landline, cloud-based, or PBX), automatic call distributor (ACD), interactive voice response (IVR), call management software, and more.
What are the types of call centers?
| Call Center Type | Primary Focus |
| Inbound | Incoming calls |
| Outbound | Outbound calls |
| Virtual | Inbound and outbound calls |
| Inbound and outbound calls | Simple requests like shipping updates or status check |
| Omnichannel | Calls and other communication channels |
Likewise, you can differentiate call centers by hosting model (virtual and on-premise), type of calls (inbound, outbound, or mixed), automation (non-automated and automated), and so on. At the end of the day, though, what really matters is how well your call center copes with its business objectives.
What is a customer service call center?
A customer service call center is a call center that provides comprehensive customer support and assistance, including resolving issues, providing product information, handling complaints, offering guidance, and more. In other words, a customer service call center focuses entirely on providing customer support while excluding or minimizing the marketing and sales objectives.
What is a call center agent?
A call center agent – known as a live operator or a customer service/support representative – is a person that handles incoming and outgoing phone calls. While the primary focus of call center agents is providing callers with quality support, they can also partake in marketing and sales as a company’s frontline personnel.
What is call center tracking software?
Call center tracking software, sometimes called call center monitoring software, is a set of tools that collect and interpret heterogeneous call data into strategic marketing insights. Call tracking software can help you understand who your callers are, where they came from, what triggered the call, and how you can serve them best.
Where to get call center solutions for small business
You need to decide which type of call center solution you need in the first place: on-premise or virtual. For a small business, the best choice might be a cloud-based phone system like Cloud PBX alongside virtual solutions like Call Logic. Likewise, you can get a comprehensive virtual software suite for calls, leads, clicks, email, SMS, accounting, and more for the same price.
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