Catalogue & online retailer Shop Direct Group has announced today that two of its four customer service centres could close as part of a new deal with professional services firm Serco.
Serco has been awarded a contract to manage the retailer’s contact centres which currently employ around 1,800 staff members, and has opened a consultation on plans to potentially close the sites in Worcester & Preston as part of a move towards more social media-based interaction with customers.
All of the current employees will transfer to Serco as part of a TUPE agreement which should protect their jobs in the short term, and the threatened centres will stay open for at least another year with any proposed closures to be discussed with employee representatives following the transfer.
Shop Direct, which owns retail brands such as Very.co.uk, Littlewoods and Isme, says that though there are likely to be redundancies following the deal, the move should improve service levels and improve efficiency for the business at a time of challenging market conditions.
Over the last six months the number of customers phoning Shop Direct has dropped by 1.65 million year-on-year, according to the retailer, while the number of shoppers contacting it through social media over the last 12 months has risen by 1,400 per cent.
Mark Newton-Jones, CEO of Shop Direct, commented: “The ways in which customers are shopping with us, contacting us and servicing their accounts have changed rapidly, driven by revolutionary advances in digital and interactive technology.
“Unfortunately, this will mean a need for far fewer people to be directly involved in customer contact in the future.
“We have chosen to work with Serco as they are an acknowledged leader in the field. Serco’s expertise, coupled with their investment in technological innovation, will ensure that we have a customer contact programme that is flexible and adaptable for the increasingly online and mobile world that we live in.”
In the last financial year Shop Direct fielded 13.4 million calls from customers but this represented a 45 per cent decline on 2007/08 when then business took 24.2 million calls.
Most of the retailer’s business has now moved online, with sales via their websites representing 75 per cent of its total revenue last year, in comparison to just 18 per cent five years ago, and the retailer imagines that an increasing amount of its customer interaction will also take place online in the future.
Serco will be tasked with using the latest technology to make customer service as efficient as possible but it is clear that these measure will also mean job losses for those working in its contact centres.
Christopher Hyman, Serco CEO, said: “We are pleased to have been selected by Shop Direct Group to deliver their customer contact programme.
“Serco will bring its significant expertise in contact service delivery to Shop Direct, further improving the customer experience through investment in technological innovation and increased efficiency.”