J.C. Penney Says Drop in Call Volume Means Contact Center Closing

With calls to its contact center down 30% since its transformation plans were announced, J.C. Penney said it would close its Pittsburgh contact center on July 1 – leaving Columbus, OH and Milwaukee as its two contact centers.

Three hundred jobs, mostly part-time positions, will be lost when the Pittsburgh contact center closes, the company announced earlier this month.

J.C. Penney spokesperson Tim Lyons said the Pittsburgh call center handled customer calls for both jcp.com and store customers – helping with placing orders, responding to customer concerns or answering questions about subjects such as merchandise, sales and coupons.

“Since we instituted our ‘Fair and Square’ pricing and simplified returns policy on Feb. 1, calls to our three centers have declined by 30% due to fewer concerns and questions from customers,” Lyons said.

Lyons said Columbus and Milwaukee are similar in size to Pittsburgh and “they all perform the same functions so there won’t be new responsibilities added to the other two. All handle customer service via phone and email.”

Lyons said the Pittsburgh contact center is a stand-alone, leased facility, while Columbus and Milwaukee are housed inside existing J.C. Penney facilities owned by the company.

In the past decade, Lyons said, the call volume to the company’s contact centers had been declining, coinciding with customers ordering more online. But the 30% drop in call volume since February was significant, Lyons said.

“The company is reducing capacity proportionally. The residual impact is both positive and negative, depending on your perspective,” Lyons said. “What it does indicate, at least, is that there are fewer customer concerns and complaints since we moved to the new pricing and returns policy.”

Kathryn E. Jackson, an associate with contact center consultancy Response Learning Corp., said J.C. Penney is doing what it has to become leaner and more competitive.

“I’m sure the overhead was the primary reason for closing the one center. With two centers, they have adequate redundancy,” Jackson said. “I haven’t checked, but I’ll bet the labor and space is cheaper in the areas of the remaining centers.”

J.C. Penney plans to reduce annual expenses by $900 million by the end of 2013.