Online shopping is much more accessible and convenient than it has ever been. People are always searching for the biggest deals or the newest arrivals, now within reach with a simple button click.
Think about it: How many times in a day have you caught yourself browsing through online shopping apps?
Customers now favor more convenient shopping methods: In the US alone, 94% of the population shops online at least once a month.
People’s preference for convenience has helped the e-commerce and multi-level marketing (MLM) industries grow exponentially in the last several years.
The COVID-19 pandemic also contributed to e-commerce and MLM growth.
Millions of Americans couldn’t leave their homes to shop during the early days of the pandemic, so they shopped online, resulting in an unprecedented boom of e-commerce sales in 2020.
However, this growth is a double-edged sword that presents various opportunities and problems.
Outsourcing can help solve many of these problems.
If you run an e-commerce or MLM business and are interested in outsourcing certain business functions but don’t know where to start, this blog is for you.
We’ll discuss the different outsourcing models, tips for choosing the right outsourcing partner, and common problems in e-commerce and MLM that outsourcing can help solve.
Outsourcing in E-commerce
Outsourcing could be a game-changer for e-commerce and MLM companies as the industry grows and becomes more competitive. Partnering with an outsourcing provider can drive significant benefits to any business. It allows companies to:
- Scale their operations according to changing market demands
- Build teams with specialized skills at a lower cost
- Allow enterprises more room to divide resources into core functions.
These are especially helpful in the e-commerce industry, where there’s a need for solutions that address industry challenges in maintaining competency and security, among others.
The 3 Outsourcing Models: Choosing the Right Fit
Your business’ success doesn’t end with simply choosing your outsourcing partner. You must also consider which outsourcing model works best for your e-commerce platform. Otherwise, you may cause your business more harm than good.
Like any significant company decision, you must come from a place of being well-informed. Understanding each outsourcing model is essential because it helps you determine the right fit by weighing each one’s pros and cons.
Here are the three different outsourcing models:
1. Onshore Outsourcing
Onshore customer support outsourcing refers to partnering with third-party customer support teams based in the same country or region as your business.
Operating in the same area as your outsourcing partner eliminates the need to adjust to different labor and cultural conditions.
However, this model generally has the following disadvantages:
- High labor and production costs
- Limited pool of specialists
- Longer talent sourcing
2. Nearshore Outsourcing
This model refers to when a company works with a foreign outsourcing provider based in a nearby region or a country that speaks the same language.
Companies favor nearshore outsourcing for its cost efficiency, time zone similarities, and accessible travel and labor requirements.
Some setbacks that could occur with this model include:
- Limited options that cater to specific business requirements
- High labor and production costs
- Quality of service
3. Offshore Outsourcing
Offshore customer service outsourcing is a popular outsourcing model that involves partnering with an offshore team from a foreign country or region. Unlike the nearshore model, offshore refers to countries that are farther away.
The most significant advantages of this location outsourcing model are its low cost and surplus of options. This model also allows access to a multilingual workforce with an adjustable schedule to suit your time zone.
Collaboration with an offshore outsourcing partner lets you gain access to partners with years of experience in your specific industry, providing you with a competitive edge.
For example, BPO partners in the Philippines have countless experienced and highly-trained CX teams, while partners in India tend to have some of the best engineering teams in the world.
Conversely, you may encounter cultural and language barriers when dealing with far-away teams. You and your offshore teams must exert more effort to learn and understand each other’s cultures, societal norms, and communication standards.
4 Tips To Consider When Choosing an Outsourcing Model
Once you’re familiar with each location outsourcing model, what comes next? There are many factors to consider when selecting the best model for your business.
Here are four tips when choosing an outsourcing model for your e-commerce business:
1. Clarify Your Business Needs.
First, you need to determine what you want to achieve through outsourcing. Once you have identified specific goals and requirements, it’s time to decide which outsourcing model would work best for your business.
2. Determine the Ideal Level of Control and Managerial Responsibility.
The degree of management outsourcing requirements varies per model. Some require more managerial control than others, and some require almost none.
3. Check Each Model’s Benefits and Risks.
When faced with multiple options, it’s always best to weigh the pros and cons of each one. Doing so will give you an overview of which model would benefit you the most. At the same time, it will also give you an idea of any potential risks.
4. Look for Reputable Outsourcing Partners.
Finding a trusted partner is the next step once you decide on an ideal outsourcing model. Research companies and their portfolios, read client reviews, and compare project quotations.
Critical Challenges in E-Commerce and MLM and How Outsourcing Can Help
Here are some of the most common challenges facing the e-commerce and MLM industries:
1. Maintaining a Competitive Advantage
Constant innovation is essential for any hypergrowth industry. Businesses must remain on their toes and introduce innovative sales approaches to differentiate themselves from competitors. By tapping into resources provided by outsourcing providers, companies can introduce fresh methods and keep up with the competition.
2. Improving Customer Satisfaction
Customer satisfaction plays a role in shaping the success of any retail business. E-commerce companies must maintain and increase customer satisfaction by keeping up with evolving tech and improving every aspect of the customer experience.
3. Addressing Data and Security Fraud
Challenges to security threats and fraud have long been present in the industry. But as e-commerce platforms continuously innovate, so do these bad actors. Decision-makers must make strides in safeguarding their business. By partnering with BPO providers, you gain access to a team with strict security measures to address such threats.
4. Delivering an Omnichannel Experience
Today’s consumers value flexibility and convenience above everything else. Some customer concerns are easily communicated and addressed in certain channels, so having multiple channels open to handle customer concerns is necessary.
A recent study concluded that 9 out of 10 consumers preferred an omnichannel approach to their shopping experience
Implementing a seamless, personalized approach encourages higher customer engagement and loyalty, which also means increased sales and revenue. Businesses will gain more by leveraging outsourcing partners with omnichannel capabilities.
Expert Offshore Outsourcing for Your E-commerce Business
For years, ClearSource has proven its place as a leading outsourcing partner. We have collaborated with companies across different industries, delivering exceptional solutions that we customize according to your unique needs.
We know that customer trust and loyalty are the lifeblood of any business, so we don’t cut corners when crafting exceptional customer experiences.
Want to learn more about how we can grow your e-commerce or multi-level marketing business? Connect with our team today!
