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North American Contact Center Outsourcing MarketsProduct Type: Market Research ReportPublished by: Frost & Sullivan Published: October 2007 Product Code: R1-6125 Description This Frost & Sullivan research service titled North American Contact Center Outsourcing provides an overview of this subset of the business process outsourcing (BPO) industry. It includes a complete analysis of key industry challenges, market drivers, restraints, and trends that are impacting market penetration as well as growth. In this research service, Frost & Sullivan's expert analysis thoroughly outlines market size, market share of major providers, and pricing strategies.
This analysis is available through our Contact Centers Growth Partnership Service program. With this program, clients receive industry-leading market research such as this, along with technical and econometric data and many interactive features including Analyst Inquiry Time and Client Council. Market Overview Greater Acceptance of Outsourcing across Business Verticals Aiding Growth Spurred on by strategic, financial, and technological forces, the North American contact center outsourcing market continues to see impressive growth. Buoyed by growing demand and stable prices, market participants reported solid organic revenue growth in 2006, with overall revenues increasing by 7 percent year over year. Frost & Sullivan believes that the current positive U.S. economic climate, coupled with greater acceptance of outsourcing across business verticals, will give rise to continued market growth in the next three to five years. However, outsourcing firms must continue to contain cost in the face of high agent turnover and a weakening U.S. dollar, in order remain competitive and profitable. It is becoming increasingly common for clients in North America to require "blended" delivery models, using a combination of onshore, nearshore, and offshore customer contact centers. This strategy not only mitigates risk, but also serves to lend support for multiple language capability and better cultural alignment for specific client requirements. "The offshore option provides clients with lower labor costs and 'follow the sun' service provisioning," notes the analyst of this research service. "Too much agent capacity in a single geography is considered risky. Political instability, reliability of suppliers on the ground, exchange rate fluctuations, infrastructure reliability, labor pool size, and accent neutralization are important offshore considerations." Home Agent Explosion The concept of home agents is fast gaining popularity in the United States, as voice over Internet protocol (VoIP) and Web-based applications make the deployment of work-at-home agents (WAHA) no more difficult than placing them in traditional call centers. Furthermore, workforce management technology and remote monitoring remove barriers for measuring productivity and adherence to key performance indicators (KPIs). Largely due to these technology developments, incoming customer calls can now be routed anytime and anywhere on a large scale. Critical to the mix is high-quality agent training, which can be delivered to the agent’s desktop via e-learning modules, thus eliminating the need for live instructors or training facilities. Going forward, offshore contact center services will continue to grow throughout the forecast period. This will exert a downward effect on margins in the short term, as pricing per agent hour is lower in offshore locations. Offshore services represent a range between 25 and 35 percent of the total North American outsourcing revenues by the end of the forecast period. Growth of offshore services will be mitigated by consumer preferences for domestic services and the increased availability of high quality U.S.-based agents through the increasingly popular WAHA model. "Outsourcing providers in North America must become solution partners that can counsel clients on the best ‘rightshore fit’ to meet market demand, determine agent sourcing, self-service options, and the most favorable site locations," says the analyst. "Enhancing the customer experience, strong data security, and strict regulatory compliance will be vital for market success." Table of Contents
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