iStock.com/ARK NEYMAN
L.L.Bean Axes Call Center Staff and Hours
L.L.Bean is laying off some of its customer service reps and reducing call center hours by four hours each day in response to fewer customer calls as more orders are being placed online.
Beginning July 15, call center hours will shrink to 8 a.m. to 8 p.m. daily from the current hours of 7 a.m. to 11 p.m. The outdoor retailer said in a statement attained by USA Today that more than 90% of customer calls come in from 8 a.m. to 8 p.m.
“As more of our customers choose self-service and shop through our digital and retail channels, customer contacts have declined over the last four years,” the retailer said. “Simply put, L.L.Bean customers shop differently today than in the past and we must adapt.”
L.L.Bean added that “these changes are not a reaction to current business conditions or part of a larger workforce reduction, but rather a strategic response to long-term customer trends.”
The number of call center workers to be laid off was not disclosed, as the retailer is offering voluntarily retirement packages to some employees before final cuts are made. L.L.Bean has more than 500 call center employees, most working remotely.
The layoffs follow the 2021 shutdown of its call center in Lewiston and its 2020 job cuts, which impacted its customer service team and eliminated 200 jobs.
In other industries, American Airlines and Verizon recently announced massive call center layoffs in a continued shift of the function to lower-cost foreign agents. In general, the customer service rep function has received a lot of attention over the last year. The role regularly lands on lists of jobs threatened by artificial intelligence as technologies like ChatGPT elevate chatbot interactions and capabilities.
Speaking recently to the Financial Times, K Krithivasan, head of Indian IT giant Tata Consultancy Services, said AI will result in a “minimal” need for call centers. He stated, “We are in a situation where the technology should be able to predict a call coming and then proactively address the customer’s pain point.”
Best Buy is among retailers planning a blended AI and human approach to customer service.
On April 9, the consumer electronics chain announced plans to introduce a GenAI-powered virtual assistant to help customers troubleshoot product issues, make online order changes, and manage subscriptions. At the same time, a new suite of GenAI-enabled tools will help service agents “assess customer conversations in real-time, providing them with in-the-moment, relevant and human-focused recommendations.”
In February, Best Buy announced a restructuring involving layoffs of Geek Squad field agents and phone support personnel in part to better capitalize on AI investments.
Discussion Questions
What’s likely the primary reason L.L.Bean’s call centers are receiving fewer calls?
Should L.L.Bean be reducing call center hours?
Do you see foreign agents or chatbots as the bigger threat to in-house customer service rep jobs?
Poll
Loading …BrainTrust
Carol Spieckerman
President, Spieckerman Retail
David Spear
VP, Professional Services, Retail, NCR
The phone ordering service used to be big for LL Bean, as did the catalogue operation. Over time both have become much smaller parts of the business as consumers have shifted to buying online or visiting stores, effectively serving themselves via both channels. This naturally necessitates a change in resourcing with the call center being downscaled and the times of operation reduced. I don’t see this as diminishing customer service; it’s just aligning business operations with consumer behavior. In other areas, especially stores, LL Bean still offers great service. As for AI and using overseas call centers: the jury is out on both things. If they are not managed carefully, they can result in dissatisfaction.
While the jury may be out on AI, it is going to get to a point where it will be indistinguishable whether or not it is a human or an AI chatbot. How well the AI assisted training is done and how efficiently the chatbot can resolve issues may end up the the determinant of satisfaction. Give me a pleasant chatbot that can solve my problem anytime over a unhappy rep that doesn’t have the answers.
The jury’s not out. The technology isn’t ready.
Maybe not yet. But it will be.
And so we lay off the people now because….?
Putting my comments in context – I wasn’t saying that the AI was correlated to these specific layoffs (actually was saying when we get to the point where AI is indistinguishable, later, that this will likely lead to layoffs). I agree with Neil’s assessment on the reasons for this specific case – it’s time to adjust resourcing for business change reasons.
The positioning of the news article, that L.L.Bean “axes” their call center staff and hours, has a negative implication, but as noted by the company, customers are choosing self-service and digital channels, and the need for a traditional call center has declined. Like many other companies, L.L. Bean are making adaptations, accordingly. That’s what smart companies do, they adapt to changes in consumer behavior.
The real issue for me, is how well is digital set up to handle sales, customer issues, returns, and other customer service needs. Some companies make their products and services easy to like when customer service systems are properly designed.
But all too often, consumers are unable to find the right answers to specific needs, and they must resort to chat, which often becomes even more frustrating because the user isn’t having communication with a real person.
If it were my brand, I would make the same steps as L.L. Bean, with adjusting to changed behavior and needs. But I would be damn sure that my digital customer service is pinpoint perfect and well-tested. – Db
The positioning of the news article, that L.L.Bean “axes” their call center staff and hours, has a negative implication, but as noted by the company, customers are choosing self-service and digital channels, and the need for a traditional call center has declined. Like many other companies, L.L. Bean is making adaptations, accordingly. That’s what smart companies do, they adapt to changes in consumer behavior.
But it’s really all about how well is digital set up for handling customer service, sales, and issues. When customer service systems are designed properly, some companies make their products and services easy to like.
Often, however, consumers can’t find complete answers to specific questions, and they must use chat, which becomes even more frustrating since the user can’t communicate with someone directly.
If it were my brand, I would make the same adjustments as L.L.Bean in order to meet the changing needs and behaviors of consumers. But I’ll be damn sure my digital customer service is flawless and well-tested. -Db
Technology – in this case online – eliminates jobs (LLB even told us that in their press release) So while this is sad for those let go, it’s evidence that their online works (’tisn’t always so: I can now speak from experience about QSR kiosks…and it isn’t good)
More intelligent online service enables all retailers to reduce call staff. Fewer issues all around would be the best of reasons for cutting call center staff. A reduction of staff and hours should be commensurate with the measurable use by customers; fewer calls, fewer staff. Off-shore options? A bad idea for more than one reason.
L.L. Bean’s explanation seems reasonable – call volume is down and their customers are engaging with them in ways that do not require call center reps. It’s a sad reality for the workers being let go, but chatbots and automated attendants are a fact of life, and generative AI will only make them even more capable over time – many are still pretty bad in my experience. Ultimately, all businesses must adapt to changes in the market and sadly, this will necessitate some people losing their jobs.
This development feels like a “sign of the times,” not a sign of troubles at L.L.Bean. If shopping habits have changed due to technology, then retailers need to adapt too.
If they’re not being utilized as much, reduction makes sense. LL Bean and other brands will have to be extremely careful that where AI does replace human customer service, it actually does a better job. Currently it’s still extremely frustrating to end up on the phone with a bot that doesn’t get anything correct.
Another investment in CX (nope!). People don’t just call to take orders. They call to deal with issues. The whole world is going to become Xfinity or Facebook with bots making endless irrational decisions.
Bad move.
Exactly, it’s not only incoming orders by phone. It’s bigger than that. They’d better hope customers don’t perceive this move as eroding built up goodwill and the hassle-free experience.
A big fan of LL Bean’s duck boots, I’ve always had a great experience with their call center, but the landscape is constantly changing, and businesses must adapt to differing consumer needs and wants or they’ll find themselves in a precarious financial situation. So, this move should not be a surprise. In fact, I applaud LL Bean for testing AI functionality and how it could enhance the customer service experience. LL Bean just needs to understand that AI won’t solve all ills and won’t drive returns immediately. AI needs lots of training and refinements. It’s a 10K, not a sprint.
It isn’t realistic to assume that people-powered customer service will remain at current levels given the massive investments retailers are making in AI-driven automated solutions. The last sentence in the article gets to the heart of the matter: Best Buy laid off Geek Squad and phone support personnel “…in part, to better capitalize on (its) AI investments.” Even so, if justifying investment is the primary driver for these decisions, retailers run the risk of unleashing half-baked technology on consumers when it counts most. Striking the right balance between high tech and high touch is retail’s core conundrum these days.
Oh, there is so much talk about AI. For those who are truly interested, there is a fascinating NOVA episode called The A.I. Revolution. It speaks to applications, capabilities, and, most importantly, the future. Surprisingly, to me, developers don’t totally know exactly how it works.
Very few companies have the ability to measure “what happens next”. Because the answer whether or not they should reduce call center hours is not solely dependent on the other tools available to their customers nor when customers regularly call — they should also look at how their customer’s journey changes after communication with an actual “live” CSR — data shows that authentic live CSR engagement – while expensive – in many verticals actually pays for itself over time due to changed customer behavior.
Sounds like LL Bean is reducing staff because they can, not because they have to or want to. They can because of the evolution in the shopping habits of their customers. And they can because the reduction in hours will not significantly reduce customer service. Pretty straightforward stuff in the name of cost savings and efficiency. Will AI help more than it hurts? Hope so. But why call it “axing”? Why give it that spin when this seems like a perfectly logical move? This is a good news story about a company evolving in a changing market. I’m sorry for the people losing their jobs, but this is a positive development in a healthy business, not a signal of underlying business weakness.
This headline gave me the impression that L.L. Bean had gotten rid of its call center completely, blasphemy for a retailer celebrated for its legendary customer service. Fortunately, that wasn’t the case.
Cutting call center hours and releasing staff as a “strategic response to long-term customer changes” makes sense. It appears that L.L. Bean is indeed minding the store.
Staffing to fit the demand is retail 101. LLbean should not feel any noticeable pain from this change. The demographics continue to shift to self service and less and less from the Catalog / contact center model that is in LLBean roots. They might have a little west Coast impact but most of the people shopping via catalog and call center are used to finding time during the day to make the call.
Most contact centers are inundated with simple transactions like “where is my order” or “Help me find a product”. When these calls get routed to a live Agent it is very expensive & an unnecessary level of service. It makes sense that AI (or self service) would take over these type of simple transactions, & the customer may walk away happier. However, when a customer calls in with questions about a cell phone contract, they are still going to want/need to talk to a human at least while AI figures out what it wants to be.
Completely agree with this tiering of support concept. AI use can as level one support can deliver a superior service level. AI will be trained, current and consistent. No guessing. Today a lot of your service level depends on the rep you get, their training and their experience. For custom requests, you are redirected to someone with experience and unique expertise. Still some risks of differences in performance among reps, but as these are higher level representatives, your odds of having a better customer experience increase. This allocation of service levels is a model that works.
Companies are already hiding behind call center automation and have introduced the “customer service prevention departments” consisting of decision tree-based bots, offshore agents, with gradually more and more AI enhancing the bots. Try to find a phone number, or a real person if perhaps you are elderly and don’t want to navigate through the online help. (Your wait time is estimated to be 90 minutes….) Some of these AI services are already better than the poor-quality help at the call center. Comcast as a good example had a completely automated diagnostic process that quickly went through the same steps as a call center rep, (but faster), and scheduled and dispatched a real tech service call within minutes (and didn’t try to clumsily sell a different plan). However there still needs to be an easy and quick path for those issues that can’t be solved by AI, or for people who can’t navigate the online help.
As a private company, LLBean certainly isn’t accountable for reporting how it is really doing. But every good retailer, whether sales are up or down, should continually evaluate its bottom line and assess profit and loss, reacting accordingly. Retailers experience increased sales numbers, grow the size of their organization, and, over time, have to rightsize. The dramatic tone in the title is to get people to click on the article, nothing more.
Consumer behavior changes and good companies adapt to those changes. It doesn’t mean the business is moving towards AI (lower service level) or performing poorly. If you understand your customer than you are always looking at the best way to service them while maintaining a healthy business. If what LL Bean is saying is factual, then this is a smart move.
The math may add up, showing they should dramatically cut phone service hours. And AI tech is getting better every day. Yet LL Bean has been a brand known for removing the hassle factor, in being customer centric. If the company still believes in the brand promise and the values haven’t changed, they ought to move carefully in this change.
Making a change like this must be met with an explanation to customers as to how it will improve their experience, make things quicker, easier, better for them. Otherwise it will look like a bottom line move.
Fewer calls require fewer agents. It’s that simple. If the changes in consumer behavior – in the way the purchase from L.L.Bean (and any other retailer) – change, the company should change with them. Reducing contact center agents because of a better CX that requires less support is a good thing.
Do foreign agents or chatbots threaten in-house CSRs? A short answer: Yes. Options that are less expensive but don’t erode – and can possibly enhance – the experience are worth considering. However, the moment the experience “goes south,” the company is at risk of a customer moving to a competitor. So, a caution to those making serious changes to an existing and successful contact center experience: Change MUST BE good for both the company AND the customer!
Many people, particularly older adults, are not tech-savvy and may struggle with navigating digital platforms or interacting with AI-powered bots. These customers often rely on traditional call centers where they can speak to human representatives who understand their communication needs and nuances.
Additionally, there are significant concerns about privacy and security with automated systems. These systems, while efficient, can lead to unintended consequences if a user miscommunicates their needs or mistakenly selects the wrong options. This risk is particularly acute for individuals with disabilities or those uncomfortable with digital interfaces, which could lead to unauthorized transactions or privacy breaches.
Call centers offer more than just solutions to customer issues; they provide a human touch that AI and automated systems cannot fully replicate, serving as a critical empathetic and reassuring point of contact for customers, even finding myself needing from time to time. As businesses continue to adopt more AI in customer service, it’s crucial they also maintain and enhance their human service options. A balanced approach that combines technological advancements with accessible, human-centric service is essential. Companies must ensure they do not alienate a significant portion of their customer base by shifting too quickly from traditional call center support, instead adopting a dual approach that meets the diverse needs of all customers.