New Economic Pressure Triggers Wave of Contact Center Outsourcing

Economic turmoil, primarily in the Euro zone economies, is prompting global companies to take new steps to rely on outsourced call center services, says a new report from  Frost and Sullivan.

“Cost savings for enterprises, multi-shoring options and customer contact expertise offered by providers in the market, together with a large, educated labour pool will promote the outsourcing of contact center services,” noted Frost & Sullivan Senior Research Analyst, Sathya Subramanian.

The contact center outsourcing market in Europe, Middle East and Africa (EMEA) experienced relatively low growth in 2011 in comparison to other major regions in the world. And the trend, the research firm says, will persist over the next 5 years due to the prevailing economic situation and stiff competition from in-house contact centers.

“The current economic situation, which has resulted in enterprises demanding higher quality customer services, will add further impetus to market development,” Subramanian added.

The contact center outsourcing market made revenues of $16 million in 2011 and the figure is likely to reach $19 million  in 2017.

Deteriorating margins in certain sectors due to the economic recession has resulted in the need to revise cost structures. This has been accompanied by a heightened focus on high quality customer interactions. To achieve this, enterprises have started to seek the expertise of third party outsourcers.

“Industry is now being driven by the growing demand for low-cost, high-quality customer contact solutions,” remarked Subramanian. “Multi-shoring capabilities for the various languages in the region and the presence of a large workforce that can offer multi-lingual contact center services will boost the industry’s growth in the forecast period.”

Even as the contact center outsourcing market expands, analyst firm says, it will face a host of challenges such as rising clout of in-house contact centers, economic recession in Euro zone and the increasing demand for more self-service options.

“In-house contact centers are preferred over third-party outsourcers by many enterprises due to quality and security concerns,” explained Subramanian. “Difficult economic conditions have led to enterprises adopting a ‘wait and watch’ approach with contact centers.”

Outsourcers are confronting these challenges by offering multi-shoring capabilities and high quality solutions at optimal costs. Such strategies are expected to help enterprises understand the benefits of outsourcing to third-party specialists.