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Clarifying Contact Center Channels to Market for Success (Review Report)Product Type: Market Research ReportPublished by: Datamonitor Published: December 2006 Product Code: R313-18814 Description IntroductionVendors are trying to determine the optimum mix of direct and indirect channels in both developed and developing markets. Meanwhile, growth in managed and hosted services is creating a whole new range of business models, partners and competitors. Scope *Alternative Hosted US Contact Center Providers (Strategy Focus) *How to price contact center solutions (Strategy Focus) *Solutions Providers a proactive channel to market for contact centers (Strategy Focus) *Global Hosted Contact Centers Update (Market Focus) Highlights This report combines all four briefs from the contact center and technologies theme for Q4 2006. The theme looks at the core go to market drivers within the contact center industry. It identifies the markets that are the fastest growing, how particular pricing methodologies affect go-to-market strategies, how vendors and service providers are re-inventing themselves, and what the key factors in the next phase of hosted contact centers. Reasons to Purchase *Discover the impact of different pricing methodologies, as price is seen as the main factor in a contact centre's decision to purchase technology. *Understand the evolving role of solutions providers and vendors, and how this development can influence a relationship. *Discover what are the catalysts that will drive the second wave of hosted contact center growth. Table of Contents DATAMONITOR VIEW 1CATALYST 1 SUMMARY 1 METHODOLOGY 1 EXECUTIVE SUMMARY 3 Introduction 3 Alternative Hosted US Contact Center Providers (Strategy Focus) 3 How to price contact center solutions (Strategy Focus) 3 Solutions Providers - a proactive channel to market for contact centers (Strategy Focus) 3 Global Hosted Contact Centers Update (Market Focus) 4 ALTERNATIVE HOSTED US CONTACT CENTER PROVIDERS (STRATEGY FOCUS) 7 Summary 7 How the low end of the contact center market is shaping up 7 The real reduction in overall costs gives rise to a revenue generating center 11 New applications for new opportunities 12 Service reliability is both important and attractive 12 Vendors - heed these concerns as they inhibit on-demand uptake 13 Security concerns hinder the uptake of a hosted solution 13 The cost of hosted solutions is a deterrent to purchase 13 A major disincentive to opting for a hosted solution is an existing arrangement 14 Closing thoughts 15 Where does IP feature? 15 Geographical footprints increase presence in hosted contact center virgin territory 15 Outsourcing as a revenue stream 15 MacDonaldization of the hosted contact center business model 16 Contact center in a box should include an integrated CRM package 16 Non-hosted vendor competition 16 An alternative choice of hosted service providers distinct from traditional carriers 17 Cincom 17 Contactual 17 Echopass 18 Five9 18 Siebel 18 UCN 19 HOW TO PRICE CONTACT CENTER SOLUTIONS (STRATEGY FOCUS) 20 Summary 20 Role of the Contact Center 21 Cost center vs. Value Center 24 CapEx vs. OpEx 24 CapEx helps to plan for the long term 25 OpEx has the advantage of flexibility 25 General contact center technology pricing 26 Production costs and sales costs play an important role in vendor and reseller margins 27 Regional variations has an impact on the price 27 Discounting schemes can be complex but help push sales 28 Maintenance does help end-user efficiency and competitiveness and provides a steady revenue stream 29 Value added services 29 Managed services offers flexibility to the end-user 29 Vendors need to find the right balance when selling consulting services 30 Sources of finance for the end-user 30 Attractions of financing options for SMEs 32 As hosted services are gaining traction in the market pricing them correctly is key 32 Usage - based pricing for contact centers 32 Concurrent verses log-in pricing 33 Bundled minutes and contact center services 33 CRM and Contact Centers 33 SOLUTIONS PROVIDERS - A PROACTIVE CHANNEL TO MARKET FOR CONTACT CENTERS 34 Summary 34 The Evolving Role of Soltions Providers 34 The challenge facing specialist SIs 35 Services offered by SIs 36 Reselling and integration of software is more profitable but harder to sell 36 Maintenance of contact center technologies is unavoidable 38 The flurry of M&A activity can confuse customers when it comes to maintenance contracts 38 A managed service provides end-user flexibility and lots of opportunities for the vendor 39 Professional services and business consulting are sweet spots for solutions providers 40 Vendor - Solutions Provider relationship 41 Vendors as implementers can be constructive to the end-user but destructive to a solutions provider relationship 41 Vendors, SIs and the importance of Workforce Optimization is increasing in prominence 42 Consulting is a hot trend that is gaining traction amongst Vendors 42 Hot Solutions areas for solutions providers to be aware of 42 Migration, convergence and virtualization are areas that are gaining in prominence 42 Workforce optimization is not just marketing hype anymore 43 Self service / multi-channel are areas that improve a contact centers reach with its customers 44 GLOBAL HOSTED CONTACT CENTERS UPDATE (MARKET FOCUS) 45 SUMMARY 45 To host or not to host - the first question that is asked 45 Clarifying the hosted contact center 45 Early adopters of the hosted contact center are primarily driven by cost control 47 There are still barriers to the initial uptake of hosted contact centers 48 Security and reliability 48 Control 48 Risk 48 A major disincentive to opting for a hosted solution is an existing arrangement 48 The second wave of hosted contact center uptake will be focused on business transformation 49 The real drivers in implementing a hosted contact center in a bid to transform the organization from a cost to a profit center 51 Reason number 1, Distributed contact centers become a reality with hosted technologies 51 Reason number 2, Accessibility to WOTs in a hosted environment can make better use of operational and customer data 51 Reason number 3, SIP - is it really a successor to CTI? 52 Reason number 4, Mobile workforces are altering the dynamic of the contact center 52 The hosted contact center market will continue to grow strongly in particular markets 53 APPENDIX 56 Further reading 56 Ask the analyst 56 List of Tables Table 1: US APs by technology location (000s) 8 Table 2: Typical contact center costs in developed markets 24 Table 3: Global hosted APs, 2004 - 2010 54 Table 4: Global Hosted contact center spend 2004 - 2010 55 List of Figures Figure 1: Evolution and size-bands of US Hosted Contact Center services 10 Figure 2: What are the three main drivers to purchasing a hosted solution? 11 Figure 3: What are the three main barriers to purchasing a hosted solution? 13 Figure 4: How would you rather pay for a hosted contact center service? 14 Figure 5: Enterprises consider a number of criteria as important when selecting a vendor 21 Figure 6: Enterprises expect their IT budgets to increase further in 2007 22 Figure 7: Changes to software and hardware spending are at opposite ends of the IT budget spectrum 23 Figure 8: Raising efficiency dominates over increasing revenues 27 Figure 9: Services offered by Solutions Providers 36 Figure 10: Changes to software and hardware spending are at opposite ends of the IT budget spectrum (Q: "How are you spending your external IT budget in 2006? How will it change in 2007?") 37 Figure 11: The network elements to a hosted contact center 46 Figure 12: Which of the following statements best describes your contact center, and how do you think that this will change over the next 12 months and 3 years? 50 Figure 13: Total Global hosted contact center APs 53 |
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