Introduction

The emerging shift from Contact Center Outsourcing (CCO) to Customer Management Outsourcing (CMO) and the expansion in geographies for service delivery have significant implications for both buyers and suppliers of customer care services. This report discusses the above trends and provides insights and perspectives on the state of the market, potential evolution, and implications for key stakeholders.

Scope

• Traditionally, several companies have outsourced their Contact Center functions for customer service, sales and marketing applications, resulting in a relatively mature Contact Center outsourcing market today
• However, in the past few years, shifting buyer needs and the advent of offshoring are calling into question the efficacy of traditional contact center outsourcing models
• Consequently, there is a need for industry stakeholders to understand these recent market shifts and align their operating models accordingly, in order to derive maximum value from their outsourcing/offshoring programs
• This market update attempts to provide insight on the recent trends impact the Contact Center offshoring market and the key implications for stakeholders going forward. Specifically, this report contains the following:

• Overview of the contact center offshoring market in terms of market size, growth and maturity
• Market evolution, key transformational trends and their impact on offshore delivery models
• Location landscape including costs, capabilities, risks and trade-offs
• Implications for buyers and suppliers

Contents

• The global Contact Center Outsourcing (CCO)  market has grown rapidly to a US$ 55 billion opportunity today. However, there are indications of an impending growth plateau with the market entering a mature phase. In contrast, the offshore Contact Center (CC) market is in a rapid growth phase with key delivery regions (e.g. India, Philippines) experiencing growth rates in the range of 25-60% CAGR compared to 10-12% CAGR growth rates for the global CCO market
• Evolution in the CC market can be viewed along a consolidation paradigm. Consolidation of scale and contact channels were the key imperatives from offshoring in the past. However, going forward, consolidation of processes within the customer management function and across business units within the buyer enterprise will be the primary focus of outsourcing solutions.
• The global CCO landscape is highly fragmented with the top 20 suppliers representing less than a third of the overall CCO market. Leading suppliers are making focused investments in technology and delivery model to align their future strategy towards integrated customer management solutions (CMO, ECMO). Significant mergers and acquisitions have taken place in the last year with suppliers looking to inorganically build capabilities and create differentiation in a fragmented marketplace.
• A number of offshore and nearshore CC location options have emerged, each with different leverage points. India and Philippines have emerged as the leading offshore destinations for English language support. Central and South American represent strong options for Spanish language support. Each location presents a different trade-off point between cost, operating risks, maturity of the supply landscape, and extent of fit with specific customer geographies