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How Hotels Can Save Up to 30% on Contact Center Costs This Budget Season

As budget season kicks into gear, hoteliers closely examine every facet of their operations to find cost-saving opportunities without compromising service.

The contact center is one area often overlooked yet brimming with potential for efficiency. Not just a cost center, contact centers can drive significant revenue—if optimized correctly.

According to Sofya McIntosh, SVP of Sales & Customer Success at ComOps, many hotels aren’t fully aware of how much their contact centers cost. Understanding call center pricing is crucial for making informed outsourcing decisions, as various factors like location and skill level significantly influence these costs.

The True Cost of Call Center Costs

While staffing remains the most obvious expense, other hidden costs can add up quickly. Call volume significantly influences the pricing structure of call center services, as the number of calls a company anticipates can affect the number of agents needed and overall costs.

The labor shortage has worsened since COVID-19, forcing hotels to pay higher wages while dealing with turnover rates as high as 45%. Constantly hiring and training new staff can drain resources, but it doesn’t have to be that way.

“We’ve helped hotels reduce contact center costs by up to 30% through outsourcing,” Sofya says. “By eliminating the burden of staffing and leveraging advanced technology, hotels can maintain consistent service levels and achieve operational efficiency.”

Types of Call Center Services

Virtual, In-house, and Outsourced Call Center Services

Call center services can be broadly categorized into three main types: virtual, in-house, and outsourced. Each type offers unique advantages and potential drawbacks, making it essential for businesses to choose the right model based on their specific needs and goals.

Virtual Call Center Services: Virtual call centers allow employees to work remotely, often from home or any remote location. This model is ideal for businesses looking to reduce office-related costs and increase operational flexibility. Virtual call centers can be managed internally or outsourced to a third-party provider, offering a versatile solution that can adapt to varying business demands. The flexibility of virtual call centers can also lead to higher employee satisfaction and retention, as agents can work in a more comfortable and convenient environment.

In-house Call Center Services: In-house call centers are managed and operated by the company itself. This model requires a significant upfront investment in hardware, software, and other necessary infrastructure. However, it offers businesses complete control over their customer service operations. In-house call centers are ideal for companies that have the resources to invest in infrastructure and want to maintain direct oversight of their service quality and performance. This model also allows for greater customization and alignment with the company’s specific processes and standards.

Outsourced Call Center Services: Outsourcing involves contracting a third-party provider to manage and operate the call center. This model particularly benefits businesses aiming to reduce costs, increase efficiency, and focus on their core operations. Outsourced call centers can handle a wide range of services, including customer service, sales, and technical support. By leveraging the expertise and technology of specialized providers, businesses can achieve high service levels without the associated overhead costs. Outsourcing also allows companies to scale their operations quickly in response to changing call volumes and business needs.

Call Center Cost Breakdown

Labor Cost: Making the Most of Your Workforce

Labor cost is a significant component of call center costs, often accounting for 60-70% of total expenses. This includes call center agents' salaries, benefits, training, and recruitment expenses. Businesses should implement strategic measures to optimize labor costs while maintaining high-quality service. Efficient Scheduling and Forecasting: Utilizing advanced scheduling and forecasting tools ensures that staffing levels are adequate to meet call volumes without overstaffing. This helps in reducing idle time and maximizing agent productivity.

Training and Development Programs: Investing in comprehensive training and development programs can significantly improve agent productivity and reduce turnover rates. Well-trained agents are more efficient and provide better customer service, which can lead to higher customer satisfaction and loyalty. Outsourcing Non-core Functions: Consider outsourcing non-core functions, such as data entry or email support, to reduce labor costs. This allows in-house agents to focus on more complex and value-added tasks, improving overall efficiency.

Performance-based Incentives: Implementing performance-based incentives can motivate agents to perform better and increase productivity. Rewarding high-performing agents not only boosts morale but also encourages a culture of excellence within the call center.

Technological Expenditures: Harnessing the Power of Technology Technological expenditures are another critical component of call center costs, typically accounting for 20-30% of total expenses. These costs include hardware, software, and infrastructure investments necessary for efficient call center operations.

Call Center Software and Platforms: Investing in robust call center software and platforms can streamline operations and improve call center performance. Features such as automated call distribution, customer relationship management (CRM) integration, and real-time analytics can enhance efficiency and service quality.

Telephony and Communication Systems: Modern telephony and communication systems are essential for seamless call handling and customer interactions. Investing in high-quality systems ensures clear communication and reduces the likelihood of technical issues that can disrupt service.

Cloud-based Solutions: Implementing cloud-based solutions can significantly reduce infrastructure costs and improve scalability. Cloud-based call center software allows businesses to easily scale their operations up or down based on call volumes and business needs, providing flexibility and cost savings. Automation Tools: Automation tools, such as chatbots and interactive voice response (IVR) systems, can reduce labor costs and improve customer experience. These tools handle routine inquiries and tasks, freeing up agents to focus on more complex issues.

Data Analytics and Reporting Tools: Utilizing data analytics and reporting tools can provide valuable insights into call center performance and customer behavior. These tools help in making informed decisions, optimizing operations, and improving overall efficiency.

By strategically managing labor costs and technological expenditures, businesses can reduce call center costs while maintaining high-quality service and enhancing customer experience.

Outsourcing: A Solution to Multiple Challenges

Outsourcing contact centers may sound like a cost-cutting move, but it offers much more than savings. Various factors influence call center outsourcing costs, such as service type, location, and operational complexities, which can lead to significant price variations.

Sofya highlights a powerful example: “We helped one company reduce their call abandonment rate from 70% down to under 3%. That had a huge impact on their revenues for ancillary services like spa bookings, cabana rentals, and reservations. By answering more calls, we were able to generate significantly more revenue from these outlets.” In another case, ComOps helped a hotel increase its qualified call conversion rate by 60%, directly improving its bottom line. “That’s huge. That’s revenue,” Sofya emphasizes. These operational improvements don’t merely save money—they unlock revenue potential that hotels might otherwise miss.

Another way outsourcing contact centers help hotels is by enhancing guest satisfaction. When agents answer calls promptly and manage reservations seamlessly, guest experience scores rise. Sofya points out that hotels that work with outsourced contact centers often see a significant improvement in their customer experience ratings, driving loyalty and repeat business.

Visibility and Optimization: The Missing Piece

Many hotels still view their contact centers as cost centers rather than revenue generators. It is crucial to distinguish between call center pricing and contact center pricing, as modern contact centers support customers across various channels. This lack of visibility into key performance indicators (KPIs) can prevent management from realizing their contact centers’ full potential.

“Most hotels don’t even know how many calls they’re missing or how well their contact centers are performing,” Sofya says. “That’s where outsourcing can really make a difference. Not only do you gain access to cutting-edge technology, but you also get detailed performance analytics that can help you optimize operations.”

By partnering with an outsourced provider, hotels can ensure their contact centers are equipped with the latest technology, improving efficiency and enhancing the guest experience. These partners can also manage quality assurance, consistently ensuring agents deliver top-notch service.

Outsourced Contact Centers Are Key to Profitability

As the budget season progresses, hotels should reassess their contact center operations. With rising labor costs, high turnover, and pressure to maintain exceptional guest experiences, outsourcing offers a practical, cost-effective solution. The evolving role of contact center agents, who must be proficient in managing various communication channels beyond traditional phone systems, is crucial in this context.

Sofya concludes, “The decision to outsource isn’t just about cutting costs—it’s about transforming your contact center from a cost center to a profit generator. By optimizing staffing, leveraging technology, and focusing on service quality, hotels can unlock significant savings and revenue opportunities.”

Your contact center could be an untapped revenue stream. Let’s find out. Reach out below

Cut Contact Center Costs & Maximize Profit Without Sacrificing Service