The domestic contact center market in India is looking up, driven by smaller enterprises from less-trodden, services focused verticals like education, healthcare and real estate
By Heena Jhingan
India Inc.’s new-found focus on customer service has given the contact center business a fresh lease of life. After a paucity of international business, the contact center business in India is looking up again, thanks to growth of the domestic call centers driven by a fast growing community of consumers that demand impeccable, round-the-clock service.
As per analysts, the domestic contact center growth story is not unique to India, but the entire APAC region. According to Frost & Sullivan, the Asia Pacific contact center outsourcing market is growing rapidly due to increasing domestic demand for third-party services.
The over all contact center market in APAC clocked revenues of $17.18 billion in 2011 and earnings are estimated to reach $29.72 billion in 2017 In 2011, 60.9 % of the total revenue was from domestic markets, propelled by the upswing in the tele-communications and banking and financial services sectors. The contribution is likely to to increase in times ahead. Going by the research firm IDC’s estimates, the domestic call center market is seen growing 33 % per year.
Parminder Kaur Saini, Industry Manager, Information & Communication Technologies Practice, Frost & Sullivan says, “The contact center market in India has been going through turbulent times since 2010 and by 2011 it was about $110-120 million, which saw nearly 50% decline last year, owing to absence of mega international deals. A significant part of the business last year, came from the domestic market.”
The contact center market in India has been on a rocky ride since late 2009 when buoyed by miscalculation. Nasscom-McKinsey reports several companies set up their international contact center shops, which were forced to shut soon due to lack of business and beating from bigger players. Emergence of newer off-shoring hubs like Philippines and rupee depreciation are other factors responsible for the current state of the market.
However, some of the players pounced on the opportunity of servicing domestic clients with small captive (run by companies for themselves) or small tertiary seat (used by collection agents or direct sales agents) contact centers. With service becoming a priority for even for small businesses, the under 10 seat or single user solutions adoption in catching up.
The new domestic buyers
The domestic contact center market is very demanding and moving away from their Excel sheet processes. As their business volumes have grown, even the small businesses expect structured monitoring of their customers explains Rahul Arora, founder CEO of Netpro Technologies, which later spun out a company called Sunoray Solutions to focus on call center solution needs of smaller enterprises.
Agrees Saket Sethu, CMO, TVT Technologies. He says, today, the call center industry means every other industry, as every business is investing in solutions that help them enhance services to the customers.
He observes that traditionally, sensitivity of data has inhibited a majority of companies from outsourcing their customer-care activities. Now mostly tele-marketing jobs are outsourced, as the database is not so crucial, and no value-added services are provided.
“Nearly 90 out of 100 enterprises would today prefer to have a captive contact center, which they can have a control on,” Sethu says.
Interestingly, the new buyers in the domestic market are not just the big enterprises like the large telecom players, and banks, but in fact, orders are now pouring in from smaller companies like e-commerce and financial services companies that are looking to enhance their customer experience and optimize work flow. At the bottom of the pyramid, the revenues are very small, but the volumes can be high.
This big opportunity in the domestic market, has led the battle between the large players like Avaya that operate in $ 400-500 per seat range and players such as TVT Technologies under $ 300-350 per seat bracket, to get bloodier.
Besides financial services, verticals like healthcare and real estate are increasingly investing in cloud-based contact center offerings from players such as Ozonetel, on a pay per seat model. Analysts believe the benefits of such solutions include the savings on CAPEX as per the requirement. In such cases, solutions could be bought by single users.
Sample this, a Gurgaon-based real estate company has subscribed to Sunoray’s solution to meet its contact center needs and using the services, the owner can manage these calls on his mobile device its self. Similarly, Sunoray has some astrologer clients that do not want to spend money on any IT boxes, but want to subscribe to a contact center application at an affordable price point.
“Usually, our service ranges between Rs 3000-3500 per month for a person. The cloud-based solution not only addresses the burst needs, but in some cases (like in ours), these solutions have the facility of a virtual attendant that forwards only relevant calls to the client,” explains Arora.
Astroyogi.com, an online platform of a celebrity astrologer is yet another example that uses a contact center solution from TVT Technologies.
The opportunities for the domestic solution providers are galore as companies across verticals, irrespective of their size are now keen on spending on these solutions. Educational institutes like Lovely Public University, Mumbai-based dental chain Mydenstist, logistic player Aggarwal Packers&Movers, appliances company IFB, Metro Lifeline Hospitals are some examples that show evidence of investment in the domestic contact center space coming from unconventional verticals. More importantly, all these examples are of small users with just about five seats.
For you, vertically
Even though the contact center solutions have penetrated deeper, beyond traditional verticals, enabling them for specific verticals has become even more challenging for the solution provider.
Each vertical is unique, the solution providers in the market are thus, tailoring their solutions keeping in mind the specific needs of these segments. For instance, the contact center requirements of a healthcare and a e-commerce player are quite distinct.
Sachin Bhatia of Drishti Software that services e-commerce players like Zabong, Myntra and Flipkart, elaborates, “Cash on delivery is a popular practice with the online buyers. In such cases the order needs to be verified before being processed. Usually this is done by making a call to the buyer. A good contact center solution should be capable of making call as soon as the order placed and complete verification, so that the order can be processed with out any delay. The efficiency of the solution plays a critical role here.”
Similarly, the helpline of a hospital might require to be connected to the communication network of its ambulances.
App-lifying the platform
Due to this kind of diversity across the verticals, the solution vendors need to customize the solutions, which in turn has led to the contact center becoming complex with intricate systems interfaces, and a large number of measurements of performance (MoP). Key performance indicators (KPIs) continue to expand.
Sanjay Gupta, Managing Director for India, Middle East and SAARC, Aspect, feels that the a contact center solution today can no more be a vanilla voice based offering, as the end users have become more tech savvy and mobile. Enterprises must keep pace with these developments and gear up to reach out through alternate channels of communication such as social media.
Johnson Varkey, Director-contact center sales, Avaya India feels that the platforms today are loaded with applications. The customer want to invest in productivity boosting applications and capabilities of call recording and monitoring as well. Customer surveys, live recording, launching automated chat, creating a knowledge base are some of the applications that are becoming indispensable across the industry.
The need now, is not only to serve and connect with the customers, but also boost business. Unlike in the past, contact centers today are expected to have a closer integration with the company’s CRM system.
Going forward, analytics also will help companies better profile consumers as well and help companies predict business trends. Gupta says, “Analytics are linked to tools in the performance optimization space, particularly quality monitoring (QM), call recording, and workforce management (WFM) software.”
According to Gupta, despite the huge opportunity that domestic market proposes, the players have a difficult terrain to cross ahead. “The market might slow down soon, as a large number of enterprises have begun exploring Unifies Communications offerings instead of buying a separate contact center solution. At the moment, there is potentially a very large unorganized SME market to be tapped.”
The challenge 
Though large by volume, the domestic market comes with its own set of challenges. CSM Murthy, CEO , Ozonetel feels that the sheer the size of the market makes it challenging for the players in this space the to approach the potential customers.
“To eliminate the challenge on the go-to-market front, a large number of players need to depend on third party aggregators to help them identify the targets.”
Price is a critical factor to stay competitive in the market. “With customers pressing for greater innovation and large number of capabilities, it becomes a herculean task to price it low. Total cost of ownership (TCO) per seat is a key deciding factor while the customers pick a solution,” Murthy added.
The money lies in offering value added applications and services on top of the basic service, points out Bhatia, adding that the Telecom Regulatory Authority of India is yet to open up VoIP. “Once that happens, the cost for these services will further be optimized,” he says.
