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Outsourced call centers continue growth in U.S.

Barney Beal
The North American market for outsourced customer service operations is expected to continue along a steady growth path, according to recent research by Frost & Sullivan Inc.

The San Antonio-based research and consulting firm states that the market reached $19.5 billion in revenues in 2005 and is likely to reach $20.1 billion by 2012. Call center agent attrition, companies' continuing to adjust to the

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Do Not Call legislation, and greater specialization by North American outsourcers are driving the market, according to Michael DeSalles, Frost & Sullivan's industry analyst for the communications practice.

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"Call centers are the tip of spear. In a lot of places, it's the only place [the] customer touches the company," DeSalles said. "For some companies, they find that's not their core competency, that's for someone else. An outsourcer can do it cheaper or better. If you're not doing a good job or at least on par with companies with good contact centers, you're at a competitive disadvantage."

Also, the backlash by North American consumers over jobs sent overseas is helping to bolster the on-shore and near-shore outsourcing markets.

The market for North American customer service outsourcing is a fragmented one, with literally thousands of providers. According to Frost & Sullivan, however, it is dominated by fewer than a dozen major, global outsourcers.

The market is growing, but outsourcers are also under increasing pressure to do more than just increase efficiencies. Clients expect outsourced call centers to improve retention, and loyalty as well.

"The way to measure that is not by handle time, which was the prevailing metric," DeSalles said. "Now we're looking at first-call resolution."

Outsourcers are also conducting post-call surveys, measuring the number of transfer calls and up-selling and cross-selling.

Consolidation in the market has also provided companies with the ability to mix and match their outsourced call center needs, using some offshore, some near-shore and some internal resources. The growth of work-at-home agents, who can access CRM systems through Web-based interfaces and phone systems through Voice over Internet Protocol, is also providing outsourcers with a greater talent pool, while reducing facility costs.

There are some significant restraints on growth, however.

"Clients still have concerns over their loss of control over -- one -- people, and -- two -- process," DeSalles said. Outsourcers suffer because many are unable to provide referenceable clients for prospective customers.

"Many keep that activity private," DeSalles said. "We're seeing an uptick in financial services and healthcare, [which] are traditionally conservative because they have so many concerns around security and privacy."

This article originally appeared on SearchCRM.com.


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