Customer-centric organizations prioritize understanding and addressing customer needs at every level. While many companies claim to put customers first, their actions — including treating customer experience as a cost center — often tell a different story. 

Scaling back CX efforts in pursuit of immediate savings can be tempting, but over-indexing on customer service costs often does more harm than good. 

Downsizing teams, prioritizing efficiency over quality metrics, or outsourcing to the cheapest provider may lower expenses in the short term — but you can’t scale back customer support and expect loyalty (or even satisfaction).

Unhappy customers are likely to churn and switch to competitors who offer better customer support — some are even willing to pay more to do so. 

As a result, many businesses are shifting their perspective on CX, treating it as a profit center rather than an expense.

Profit Center and Cost Center: What’s the Difference?

Cost centers don’t directly generate revenue, they simply incur costs to operate. Cost center metrics prioritize maintaining budget and increasing efficiency.

While they also incur costs, profit centers demonstrate considerably more value for the cost, and in some cases, directly generate revenue as a profit center. Relevant metrics focus on increasing income and maximizing profitability.

Historically, Customer Support Was Just Another Expense

Businesses used to approach customer care as just a cost center to be managed and minimized. The goal was simple: provide service at the lowest possible cost and make it just good enough to keep customers from churning. 

Downsides of this approach include:

• Misguided Metrics — Success in this model often hinges on metrics like shorter handling times and faster resolutions. While companies might successfully optimize these isolated measures, they often fail to track what truly matters such as customer satisfaction, annual recurring revenue (ARR), and customer lifetime value (CLTV). For example, finishing calls quickly doesn’t account for whether the problem gets solved or if the customer has to call back multiple times.

• Over-Reliance on Self-Service — While effective for some inquiries, companies often deploy self-service tools primarily to cut costs rather than to enhance experiences. Relying too heavily on these solutions frustrates customers who need, or may prefer, human support.

• AI Fatigue — AI doesn’t always enhance CX, especially when it’s deployed to replace live support. Many customers would rather wait to speak to a live person than interact with an AI chatbot, and feel frustrated and disregarded when live support isn’t an option.

• Labor Arbitrage — The traditional approach to outsourcing CX prioritizes the cheapest vendor over quality. This often results in hidden fees, excessive change orders, and poor service levels — leading to higher costs in the long run without delivering meaningful improvements in service.

These cost-center mindsets position high-quality CX as optional rather than essential. But perspectives are shifting and many companies now realize that if they’re unwilling to adapt, they risk losing customers and revenue. 

Moving from Cost Center to Profit Center

Companies that focus primarily on reducing CX costs routinely suffer from poor CX quality, which erodes customer loyalty and diminishes revenue opportunities. 

Customer-centricity, on the other hand, contributes to long-term success and research shows that customer-centric companies are 60% more profitable than those who are not.

Recognizing the link between customer-centricity and profitability, forward-thinking companies now prioritize customer success, emphasizing KPIs like NPS, CSAT, customer retention, ARR, and brand advocacy. 

This shift transforms customer success from a reactive cost center into a strategic advantage. CX becomes a source for critical touchpoints to gather data, upsell and cross-sell, and create moments that strengthen customer retention.

A proactive, customer-centric approach includes:

• Leveraging data to personalize interactions and forecast customer behavior. 
• Identifying churn risks early and re-engaging customers before they decide to leave.
• Equipping CX agents with robust training that fosters a deep understanding of the brand, empowering them to significantly boost retention and CLTV.
• Partnering with value-centric outsourcing providers who go above and beyond transactional services to focus on collaboration, innovation, and strategic alignment.

Balancing Technology and the Human Touch

Historically, companies viewed technology like AI as a CX cost-saving measure, often employing automation and chatbots to replace human interaction.

When implemented strategically, automation is an effective first touch, allowing savvy users to find self-service answers before speaking with a live agent. However, an automated system that creates friction — for example, if the process ends without offering live support options — drives dissatisfaction, churn, and negative feedback on social platforms.

Customers value efficiency and convenience, but not at the expense of the empathy, creativity, and problem-solving skills that only human support agents can provide.

In other words, it’s all about balance.

Technology should not replace people, but empower them. For example, back-end AI tools enhance both agent productivity and customer experience by:

• Providing agents with up-to-date information on products and services, policies, and other knowledge base data
• Identifying customer sentiment
• Personalizing interactions based on customer preferences and behavior
• Prompting response suggestions
• Expediting call routing
• Performing data analysis to identify escalation trends and more
• Flagging churn risk customers

For customer-facing AI, like chatbots, transparency is key. Users need clear indicators that they’re interacting with AI, and a seamless path to connect with human support when needed. 

Whether AI is internal or customer-facing, it requires proper setup, integration, and human oversight. Businesses that fail to craft a strategy for AI implementation risk missed automation opportunities, fragmented systems that leave vital data siloed, or even rogue AI incidents that damage customer trust.

Additionally, AI success depends on the quality of your training data, and without comprehensive, high-quality data, the AI’s performance, accuracy, and overall effectiveness suffer significantly.

Increasing Profitability Without Compromising on Quality

The right outsourcing partners do more than just handle tasks — they complement your teams and act as strategic allies, ensuring your CX standards remain strong even during high-intensity periods like rapid growth phases, product launches, and peak season.

Outsourced CX goes far beyond answering phones or handling tickets. The right outsourcing provider collaborates with you to develop and implement strategies that support the entire CX lifecycle, helping you achieve broader goals like driving customer retention and enhancing brand loyalty — not just improving average handling time or reducing headcount.

Outsourced teams can fill in gaps on your in-house team or completely revamp your existing CX strategy by:

• Providing 24/7 customer support, especially if you have a global audience
• Offering specialized skills like technical customer support or expertise on a specific platform, like live chat
• Identifying customers at risk of churn and managing renewal outreach to increase retention
• Optimizing your upselling and cross-selling efforts
• Delivering multilingual support to serve diverse customer bases
• Gathering feedback and taking action based on customer insights
• Conducting data analysis and trend reporting to inform decision-making
• Enabling efficient scaling over time without compromising on quality

Ready to Transform Your CX from a Cost Center to a Value Center?

Achieving the benefits of exceptional CX starts with building a top-tier CX team, and SupportNinja is here to help. 

SupportNinja partners with you to craft seamless, end-to-end customer experiences that build loyalty, drive retention, and support your long-term growth. Together, we transform customer interactions into strategic advantages, empowering your team to deliver exceptional results.

Enhance your customer journey and scale with confidence. Get started.