The Pros and Cons of Live Chat Outsourcing in the Philippines

Many consumers prefer live chat customer service channel because it lets them quickly send inquiries and receive replies. According to Help Scout, customers view live chat positively, with more than 90% rating the touchpoint as “great." Learn more.
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Recent technological advances have enabled people to send quick messages wherever they are and whatever they are doing. Hence, live chat has become the ultimate tool for businesses wanting to meet customer needs in real time without human agents. 

Although companies can integrate this channel into their in-house customer service process, most rely on third-party providers for reduced expenses. Specifically, they turn to live chat outsourcing in the Philippines to guarantee cost efficiency. 

Before you hire an offshoring provider from the Philippines, let us discuss the positive and negative outcomes you should expect when outsourcing this scalable channel. 

The Benefits of Philippine Live Chat Outsourcing

Live chat outsourcing is when businesses hire a third party to provide real-time chat support. Many consumers prefer this customer service channel because it lets them quickly send inquiries and receive replies. According to Help Scout, customers view live chat positively, with more than 90% rating the touchpoint as “great.”

Its English-proficient workforce, cost-effective services, and high cultural compatibility drive many businesses to outsource live chat support to the Philippines. Of course, companies want to work with a Filipino contractor due to other advantages; we will discuss them in detail below.

Cut Operating Costs

Businesses of all sizes contract a live chat outsourcing agency from the Philippines due to reduced labor, infrastructure, and real estate costs. The country is a developing nation in Southeast Asia. So it has a lower cost of living and lower wages than the United States. 

Based on recent data from Payscale and ZipRecruiter, the average hourly rate of chat support representatives in the Philippines amounts to approximately ₱101 or $2. Their U.S. counterparts take home nearly ₱790 or $15. Thus, you can save between 50% and 90% on labor costs alone if you delegate your live chat support to a Filipino service provider.

Maximize Skilled and English-proficient Professionals

The Philippine business process outsourcing (BPO) industry houses highly skilled and English-proficient professionals. The country recognizes English as an official language and requires related linguistic studies in schools. As such, English communications come easy for a significant portion of the population.

As a result, the Philippines takes the second spot out of 24 Asian countries in high English proficiency. It garnered an Education First English Proficiency Index score of 578, with a global average of 502.

Filipino workers value continued learning and upskilling. They constantly undergo comprehensive training for both voice and non-voice customer service. They also have the following work qualities that attract most foreign companies to try live chat outsourcing in the Philippines:

  • Quickly adapt to varying work rules and regulations
  • Show optimism, friendliness, and hospitality when interacting with customers
  • Know the latest news and market trends
  • Uphold a global mindset for more personalized customer experiences
  • Work the night shift to accommodate the different time zones
  • Explore innovative ways to meet consumer needs fast

Optimize Advanced Technologies

Front- and back-office outsourcing providers from the region use robust technologies to provide superb live chat support. They optimize artificial intelligence (AI) solutions to enhance non-voice customer experience, improve worker productivity, and boost response speed.

  • Machine learning (ML) analyzes consumer interactions and identifies patterns in inquiries to improve customer service speed, accuracy, and efficiency. This frees up time for support agents to focus on more complex problems.
  • Robotic process automation (RPA) automates consumer responses, data entry services, and customer account updates. RPA includes chatbots that can answer basic questions and address common issues 24/7. They also perform simple tasks such as appointment scheduling and order processing.
  • Natural language processing (NLP) helps computers understand and interpret human language. NLP categorizes consumer inquiries and forwards them to the appropriate live chat support agents.
  • Sentiment analysis involves using AI to make sense of customer messages and pinpoint the ones feeling negative emotions such as frustration and anger. This way, agents know who to prioritize and what resolutions best fit their problems.
  • Predictive analytics identifies customer needs and provides proactive solutions based on chat history. BPO firms use the resulting insights to study risks, opportunities, and trends to inform their next moves.

Besides AI, live chat outsourcing providers from the Philippines use cloud technology to deliver services such as contact center as a service (CCaaS) over the internet. They use this solution to host the live chat platform and securely store sensitive customer data.

Ensure High-quality Service

Given the labor and technological benefits discussed above, Philippine-based contractors provide high-quality service. Because they possess all the required talent and advanced technology, they deliver the following types of live chat support with excellent outcomes: 

  • Customer service (e.g., contact centers and non-voice accounts)
  • Technical support (e.g., help desks and desktop assistance)
  • Healthcare support (e.g., telemedicine)
  • Financial service support (e.g., online appointment setting and customer support)
  • E-commerce support (e.g., non-voice consumer assistance and order processing)

Increase Scalability and Productivity

As mentioned, the country’s BPO providers have the workforce and technology necessary to help clients increase productivity while addressing customer inquiries. Filipino workers are highly trained to execute tasks efficiently and quickly. Their modern solutions streamline repetitive tasks.

In addition, live chat outsourcing providers in the Philippines help scale operations by adapting to changing needs, customer demands, and industry shifts. They constantly modify their work strategies to match their clients’ policies and procedures.

Benefit From Government Assistance

The Philippine government implements rules and regulations to acknowledge and maintain the BPO industry’s vast contribution to the national economy. This helps make outsourcing to the Philippines sustainable. The policies and procedures enumerated below are tailored to benefit local providers and their foreign clients.

  • The Department of Information and Communications Technology (ICT) Act of 2015 simplified access to affordable and reliable ICT and technical support outsourcing services.
  • The Data Privacy Act of 2012 protects personal data confidentiality in compliance with international security standards. It oversees the proper management of a foreign client’s outsourcing requirements and alignment with the nation’s data privacy rules.
  • The Special Economic Zone Act handles special economic zones. Ecozones have set tax benefits and exemptions, so businesses purchasing live chat support from BPO companies in these regions can further reduce their costs.
  • The Telecommuting Act lets BPO employers allow telework under a mutual agreement with their employees. This makes live chat outsourcing to the country more affordable.

The Drawbacks of Philippine Live Chat Outsourcing

Although outsourcing live chat support to the Philippines offers many advantages, businesses might encounter certain inconveniences. You must understand the drawbacks beforehand to help you prepare a concrete action plan.

Check out the following disadvantages of hiring a BPO provider from the region:

Lack Quality Control 

Whether you outsource tech solutions, live chat support, or other non-core functions, you have limited quality control when working with service providers from another country. Businesses cannot monitor the BPO partner’s every move as they have to prioritize continued expansion.

Filipino service providers specialize and excel in this field, as you can tell from their accolades and client testimonials. Still, you must establish good communication with your provider to guarantee high-quality output. Otherwise, unresolved issues result in poor live chat experiences and dissatisfied customers.

Overlook Hidden Fees

Philippine BPO companies offer fixed and subscription-based service packages. You can choose between a monthly billing cycle or a pay-as-you-need setup when acquiring their services. However, you might pay more than expected if you ignore hidden costs. 

Note that currency conversions and value fluctuations incur additional charges on your BPO bills. Monitor these aspects when hiring a live chat outsourcing provider from the Philippines.

Encounter Data Security Risks

According to IBM, 45% of data breaches occur in the cloud. Breaches happen due to ransomware attacks, hacking incidents, and unauthorized data access.

This figure reflects customer data’s susceptibility to cyberattacks, especially when collaborating with third-party companies. Live chat support providers usually use the cloud to collect, store, and share sensitive information with clients in real time.

Although Philippine-based providers observe strict security guidelines, they remain vulnerable to malicious activities. Expect to encounter data privacy and hacking risks if you do not cooperate closely with your BPO partner. Also, prepare for expensive threat mitigation efforts if you do not take a step to resolve cybersecurity challenges beforehand. 

Experience Transparency Issues

Delegating your live chat function to a Filipino service provider involves exchanging confidential data. However, some contractors might be reluctant and refuse to share relevant information. Some businesses might also hesitate to share their insights.

This lack of transparency and trust weakens the foundation of your working relationship with your BPO partner. Slow and ineffective problem resolutions, revenue losses, and high mitigation costs arise when both parties are unwilling to share each other’s working strategies. 

Face Technology Flaws

Although advanced technologies previously tackled helped boost live chat support, issues can still happen at any time.

If you and your Philippine-based provider ignore system monitoring and maintenance, technical problems will only complicate situations and heighten burdens. The high cost of project delays and mitigation expenses can afflict both teams.

The Bottom Line

Working with a live chat outsourcing provider from the Philippines brings many advantages to improving your customer service. Disadvantages still exist to challenge your growth progress, though.

Understanding such benefits and drawbacks helps you develop a well-structured BPO plan. This action assures your investment returns in the long run.

Connect with Unity Communications now if you want to experience the convenience discussed. The award-winning BPO provider has a well-rounded team in the Philippines to assist you in overcoming your live chat support struggles.

Picture of Joyce Ann Danieles
Joyce Ann Danieles is an SEO content writer from Manila, Philippines. She’s comfortable writing outsourcing-focused articles, helping you clarify the confusing concepts surrounding the BPO industry. With her experience in news writing and copywriting, she’s always ready to feed your brain with random facts and creative insights.   Outside work, Joyce explores the world of literature. She tries to write fiction she hopes to share with everyone someday.
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Joyce Ann Danieles

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