“The contact center outsourcing market is currently still benefiting from the aftermath of the COVID-19 pandemic and the increased demand for agent-based services. However, influenced by current crises, the market is gradually compelled to sustainably change and optimize its costs and revenue structures.”
Matthias Riveiro, Partner, Customer Transformation, PwC GermanyStatus quo and outlook on the developments and trends of the global contact center outsourcing market
The global contact center market has evolved into a central element of the modern business world and is estimated at $353 billion. An annual growth of 3.7% is anticipated between 2021 and 2025. This momentum is driven by several factors, including economic recovery post-pandemic, the increasing complexity of consumer goods, and the growth of online commerce.
North America dominates the outsourcing market, holding a 42% share. This is primarily attributed to the increasing adoption of outsourced contact centers and the deployment of innovative technologies that enhance both efficiency and the customer experience.
“Thanks to the growing adoption of digital transformation, the global CRM and contact center market is benefiting from improved customer experiences and higher levels of customer satisfaction. The resultant efficiency gains, increased scalability, and reduced costs have further supported business success throughout the sector.”
However, there are also challenges. Service providers feel cost pressure due to macroeconomic factors such as rising wages in the European corridor, inflationary pressures following the COVID-19 crisis, and geopolitical tensions, especially the Russian-Ukrainian conflict. At the same time, a shortage of qualified professionals in certain regions is prompting companies to shift their contact centers to more cost-effective areas. It is crucial to focus on language proficiency and cultural understanding—both key aspects for delivering excellent customer service.
“Companies seeking to remain competitive must ensure their contact centers balance the benefits of technological advances with the value of investing in their human capital by upskilling employees and providing comprehensive training to equip staff with the knowledge and skills needed to deliver outstanding customer service. German companies are currently heavily piloting in the generative AI domain, aiming to save qualification and personnel costs, for example, through the implementation of supportive applications for their agents.”
Market trends and technological shifts
In a dynamic market landscape, 88% of customers consider the company's customer experience equivalent to its products. Customers demand constant accessibility, swift solutions, and personalized experiences. Hyper-personalization is crucial, as 60% of customers exhibit less brand loyalty when hyper-personalization is not offered. The digital transformation and technological progress drive these heightened expectations but provide a solution through the use of innovative technologies. Predictive analytics, AI tools, chatbots, and RPA are revolutionizing the service, with the symbiosis of AI and agents being central. Contact centers must optimally blend technology and personnel development to remain competitive. The following trend tree provides an overview of the market trends and technological changes currently to be observed.
Increasing market consolidation
To keep pace with the speed of this digital transformation, many providers are responding with mergers and acquisitions. The main focus is primarily on expanding their own technological and digital capabilities. These strategic measures to strengthen digital competencies and expand global reach result in increased dynamism and significant market consolidation.
The 5 key action areas
A customer-centric approach is essential for companies to differentiate themselves from competitors and meet the rising customer expectations.
Customer loyalty is steadily decreasing, making it more important than ever for companies to invest in excellent customer service and provide personalized, customer-centric experiences to build long-term customer relationships.
Faced with rising costs, cost-saving measures are essential to remain competitive. Options such as outsourcing, reducing office space, and M&A transactions may be considered as viable courses of action.
Advanced technologies such as Predictive Analytics and AI are transforming the world, we work in. It is crucial that employees undergo continuous training to effectively utilize these technologies.
The working environment has undergone significant changes, particularly since the COVID-19 pandemic. Both service providers and in-house operations must offer flexible work models, such as remote work, to remain competitive in the race for skilled professionals.
The approach
To comprehensively cover the CRM and contact center outsourcing market, the study is divided into two sections. First, it will provide insights into the current status and developments from a global perspective. This includes industry metrics, current top players in the market, M&A transactions, relevant top trends, and technological developments. Subsequently, the contact center outsourcing market will be analyzed through various regions and deep dives, with a focus on the corporate perspective, including examination of market participants and market penetration.
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