North American
Contact Centers in 2006:
The State of the Industry
            (1st edition)




      Principal Analyst: S...
Contents

5    Chapter One: Methodology and Background

     6    Definitions and figures
     9    Distribution and use o...
60   Chapter Six: The Use of IVR and Outbound Dialers in North
     American Contact Centers

     61   IVR (interactive v...
List of tables


 Table     Page    Description
number    number

   1          7    Statistical assumptions
   2         ...
Chapter One:
Methodology and Background

“North American Contact Centers in 2006: The State of the
Industry” is the 1st in...
center in a specific small region which has not been included in the North
American Contact Center Directory, multiplying ...
analysts’ estimates would be more difficult for our readers were we to do
so.

The following table shows the size bands an...
Table 2: Vertical market definitions


Vertical market           Sub-sectors

Engineering and           Building suppliers...
Distribution and use of this report

This report is written for the community of people interested in the
present and futu...
Chapter Two:
The Structure of the North American Contact Center
Industry: Market Size


  There are presently 56,900 conta...
US Contact Centers and Agent Positions by Size

As the following graph shows, there are a very large number of contact
cen...
Table 3: US agent positions and contact centers by size of contact
center


Size band           Number of         % contac...
The transport and travel vertical market includes travel agents (both
High Street and web-based), public transport compani...
US contact centers by vertical market
                                       Utilities                         Entertainme...
US agent positions by vertical market

The financial services sector has the most agent positions, at almost
500,000, with...
Table 5: US agent positions by vertical market


Vertical market                          Agent positions   Percentage

Fi...
US contact center size by vertical market

The mean average sizes of contact centers by vertical market are listed
below, ...
Canadian Contact Centers and Agent Positions by Size

As with the US, there are a large number of contact center operation...
Table 7: Canadian agent positions and contact centers by size of
contact center


Size band          Number of        % co...
Canadian contact centers by vertical market
                                Utilities     Engineering and
                ...
Canadian agent positions by vertical market

As in the US, the financial services sector has the most agent positions, at
...
Table 9: Canadian agent positions by vertical market


Vertical market                          Agent positions   Percenta...
Canadian contact center size by vertical market

The mean average sizes of contact centers by vertical market are listed
b...
Chapter Three:
The Structure of the US Contact Center Industry:
Geographical Location


   3.7% of the US’s employed popul...
The US contact center industry structure by region

“Region” is the top-level of US geographical segmentation. Very widely...
The US contact center industry structure by division

This section of the report analyses the US contact center industry b...
Agent positions by US division




                                                                                   ME
 ...
Contact center employment by US division




                                                                             ...
An interesting pattern thrown up here is the North-South divide along the
importance of contact centers to the division. T...
The US contact center industry structure by state

Please note – the following figures are estimations of contact center a...
Agent positions by US state




                                                                                   ME
    ...
Contact center employment by US state




                                                                                ...
Table 13: The US contact center industry by state


                                                                     %...
% employed    Average
                  Agent                        Contact    Working       in contact     size
State   ...
Chapter Four:
Market Forecasts to 2010


  Between 2006 and 2010, the US contact center industry will shrink by
  2.8% in ...
US contact centers, 2004-2010


                                                US contact centers, 2004-2010

           ...
of consolidation, nearshoring (mainly to Canada, although also to Mexico),
and offshoring (the Philippines and India are t...
US agent positions, 2004-2010


                                               US agent positions, 2004-2010
             ...
US vertical market forecasts, 2009

Table 16: US contact centers by vertical market, 2009


                              ...
Table 17: US agent positions by vertical market, 2009


                                  Agent
Vertical market           ...
US employment forecasts, 2009

The public sector will add considerably to its contact center employment
figures, but there...
Canadian contact centers, 2004-2010



                                          Canadian contact centers, 2004-2010
     ...
Canadian agent positions, 2004-2010


                                           Canadian agent positions, 2004-2010

    ...
Canadian vertical market forecasts, 2009

Table 21: Canadian contact centers by vertical market, 2009


                  ...
Table 22: Canadian agent positions by vertical market, 2009



                                    Agent         % of over...
Canadian employment forecasts, 2009

The outsourcing & telemarketing sector will add over 12,000 jobs to the
Canadian cont...
Chapter Five:
Inbound and Outbound Activity


  US outbound activity is currently at just over 30%, with Canada’s
  being ...
US: inbound/outbound activity by size of contact center


                       US inbound and outbound activity by size ...
outbound work is done by outbound-only agents, hence the need for
“outbound agent equivalents”).


Table 25: US: outbound ...
US: inbound/outbound activity by vertical market


                          US inbound and outbound activity by vertical ...
Table 26: US: equivalent outbound agent positions by vertical
market


Vertical market                 Outbound activity  ...
US: inbound call volumes

Table 27: US: inbound call minutes by vertical market


Vertical market                  Minutes...
ContactBabel believes there are around 243 billion inbound call minutes
per year into US contact centers. Outbound call st...
Microsoft Word - North American Contact Centers in 2006 - The ...
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Microsoft Word - North American Contact Centers in 2006 - The ...
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Microsoft Word - North American Contact Centers in 2006 - The ...
Microsoft Word - North American Contact Centers in 2006 - The ...
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  1. 1. North American Contact Centers in 2006: The State of the Industry (1st edition) Principal Analyst: Steve Morrell AUGUST 2006
  2. 2. Contents 5 Chapter One: Methodology and Background 6 Definitions and figures 9 Distribution and use of this report 10 Chapter Two: The Structure of the North American Contact Center Industry: Market Size 11 US contact centers and agent positions by size 12 US contact centers by vertical market 15 US agent positions by vertical market 17 US contact center size by vertical market 18 Canadian contact centers and agent positions by size 19 Canadian contact centers by vertical market 21 Canadian agent positions by vertical market 23 Canadian contact center size by vertical market 24 Chapter Three: The Structure of the US Contact Center Industry: Geographical Location 24 A note on Canadian contact center distribution 25 The US contact center industry structure by region 26 The US contact center industry structure by division 29 The US contact center industry structure by state 35 Chapter Four: Market Forecasts to 2010 28 US contact centers, 2004-2010 30 US agent positions, 2004-2010 32 US vertical market forecasts, 2009 35 US employment forecasts, 2009 42 Canadian contact centers, 2004-2010 43 Canadian agent positions, 2004-2010 44 Canadian vertical market forecasts, 2009 46 Canadian employment forecasts, 2009 47 Chapter Five: Inbound and Outbound Activity 48 US: inbound/outbound activity by size of contact center 50 US: inbound/outbound activity by vertical market 52 US: inbound call volumes 54 Canada: inbound/outbound activity by size of contact center 55 Canada: inbound/outbound activity by vertical market 57 Canada: inbound call volumes 58 The future of outbound calling -2-
  3. 3. 60 Chapter Six: The Use of IVR and Outbound Dialers in North American Contact Centers 61 IVR (interactive voice response) in North American contact centers 66 The future of self-service 68 Use of outbound dialers in North American contact centers 61 Chapter Seven: Contact center management gender 73 Commentary: The State of the Industry in 2006 79 APPENDIX: ABOUT CONTACTBABEL -3-
  4. 4. List of tables Table Page Description number number 1 7 Statistical assumptions 2 8 Vertical market definitions and examples 3 12 US agent positions and contact centers by size of contact center 4 14 US contact centers by vertical market 5 16 US agent positions by vertical market 6 17 Mean average US contact center size by vertical market 7 19 Canadian agent positions and contact centers by size of contact center 8 20 Canadian contact centers by vertical market 9 22 Canadian agent positions by vertical market 10 23 Mean average Canadian contact center size by vertical market 11 25 The US contact center industry by region 12 28 The US contact center industry by division 13 33 The US contact center industry by state 14 36 US contact centers, 2004-2010 15 38 US agent positions, 2004-2010 16 39 US contact centers by vertical market, 2009 17 40 US agent positions by vertical market, 2009 18 41 US contact center employment changes by vertical market, 2006- 2009 19 42 Canadian contact centers, 2004-2010 20 43 Canadian agent positions, 2004-2010 21 44 Canadian contact centers by vertical market, 2009 22 45 Canadian agent positions by vertical market, 2009 23 46 Canadian contact center employment changes by vertical market, 2006-2009 24 48 US: outbound activity by size of contact center 25 49 US: outbound agent positions (equivalent) by size of contact center 26 51 US: equivalent outbound agent positions by vertical market 27 52 US: inbound call minutes by vertical market 28 52 US: inbound call minutes by size of contact center 29 54 Canada: outbound activity by size of contact center 30 55 Canada: outbound agent positions (equivalent) by size of contact center 31 56 Canada: equivalent outbound agent positions by vertical market 32 57 Canada: inbound call minutes by vertical market 33 57 Canada: inbound call minutes by size of contact center 34 62 Use of IVR by vertical market 35 63 Use of IVR by size of contact center 36 69 Use of outbound dialer by vertical market 37 70 Use of outbound dialer by size of contact center 38 71 US contact center management gender 39 72 Canadian contact center management gender -4-
  5. 5. Chapter One: Methodology and Background “North American Contact Centers in 2006: The State of the Industry” is the 1st in a series of annual reports looking at the structure of the industry from an analytical and statistical viewpoint. This piece of market analysis is based upon a foundation of fact: the numerical analysis of a database of over 3,000 US and Canadian contact centers, called the North American Contact Center Directory. The North American Contact Center Directory is one of the largest and most comprehensive databases available of North American contact centers and their management. Furthermore, it is updated and expanded at least twice per year. Further information on the North American Contact Center Directory and how to purchase it can be found at www.contactbabel.com/usccd.html This report, “North American Contact Centers in 2006: The State of the Industry” analyses each record of this database, segmenting by size of contact center, vertical market and geographical location in order to provide the reader with unparalleled accuracy in understanding the industry. However, ContactBabel realizes that while the North American Contact Center Directory is a good starting point for analysis, it does not cover every single contact center operation in the US and Canada. Therefore, we have estimated to the best of our knowledge the proportion of each size of contact center which is included within the database, and multiplied upwards to achieve what we believe to be the most accurate measurement of the North American contact center industry available, as well as using vendor shipments and statements to get to a top-line figure with which we are confident. Considering that most other market sizing reports rely upon “consensus forecasting” or vendor-stated shipments, rather than ‘bottom-up’ counting of the base blocks, it is to be hoped that the reader will acknowledge the superior accuracy of this report. Please be aware that this methodology works best as a relative measure, rather than as an absolute count of operations or agent positions. This is because multiplying everything upwards from a base of solid fact will keep the relative proportions the same, but will miss anomalies which the original figures did not show. For example, if there is a large contact -5-
  6. 6. center in a specific small region which has not been included in the North American Contact Center Directory, multiplying the figures upwards from this region will not take this into account. Therefore, we would ask that readers please use these any absolute figures only as approximations, especially where segments are very small. Although “North American Contact Centers in 2006: The State of the Industry” is not perfect, we are the only analyst firm looking at the North American contact center industry from a sample of over 3,000 contact centers and around 750,000 people. Definitions and figures Throughout the report, the phrase “contact center” will be used to refer to multimedia contact centers (deal with email and Internet contacts as well as telephony), call centers (traditional, telephony operations) and customer service centers, sales centers etc. Although not all of these operations will be dealing with non-telephony customer contact, using “contact center” as the generic term will help to concentrate thoughts on the future of the industry. In cases where figures have not been rounded up or down, this does not imply that figures should be taken to be accurate to the nearest agent position or contact center. Like every other analyst firm, ContactBabel uses a measure of subjectivity and opinion in order to arrive at a conclusion, and we believe that the reader should be aware of the various processes which figures have been subjected to in order to reach a final number. Therefore, numbers - especially at geographical level - have not been massaged in order to seem more authoritative: please bear in mind that most of these figures are products of initial “true” raw data, multiplied upwards and segmented into smaller pieces in order to bring out the patterns or themes which ContactBabel believes are important to show. Each year, we attempt to map the contact center industry as accurately as we can at the time. In some cases, new information comes to light that was previously unavailable: we choose to report data as accurately as possible at the current time, rather than to be forced into supporting old data which may now be proven to be less accurate. A major segmentation within this report is size band. No contact center with fewer than 10 agent positions (seats) was considered within this report. Although the North American Contact Center Directory has around 200 mini contact centers with fewer than 10 seats, it was felt that we could not accurately estimate the number of operations of this size which we do not have within the database, so the veracity of the report would be diminished if this size band were included. Other analysts rarely take this size band into account, so any comparisons between -6-
  7. 7. analysts’ estimates would be more difficult for our readers were we to do so. The following table shows the size bands and the average size that each contact center within the size band was assumed to have. Table 1: Statistical assumptions Assumed average size within range Agent positions (range) (agent positions) 10-24 14 25-50 29 51-100 59 101-150 126 151-200 160 201-250 212 251-500 306 501-1000 602 1000+ 1,206 Apart from contact center size band, the other main segmentation is vertical market, sometimes known as business sector. A brief definition of each follows. -7-
  8. 8. Table 2: Vertical market definitions Vertical market Sub-sectors Engineering and Building suppliers, builders Construction Entertainment and Hotels, ticket booking Leisure Finance Banking, insurance, credit cards, loans, debt collection, credit checking agencies Food and Drink Brewers, food suppliers IT Technology sales and service (external, no internal company helpdesks included); ISPs Manufacturing Manufacturers (often product support and queries) Medical Pharmaceuticals, healthcare Motoring Manufacturers, rental, assistance Outsourcing and Telemarketing companies and large full-service outsourcers Telemarketing Retail and Distribution Home shopping, catalogue, parcel carriers, logistics, support for physical shopping outlets Printing and Newspaper and magazine advertisements, subscriptions etc. Publishing Public Services Government, federal, state, local, agencies, emergency services Services Non-physical service offerings to public and business; other Telecoms Mobile and fixed line operators, sales and support Transport and Travel Public transport information and booking, travel agents Utilities Gas, electricity, water Analysis for this report was started in June 2006 and completed in August 2006. To comply with the usual protocol of market analysis, years are reported as year-end (i.e. the 2006 figures are reporting the state of the industry as it will be in December 2006). All revenues are in US$. -8-
  9. 9. Distribution and use of this report This report is written for the community of people interested in the present and future structure and shape of the North American contact center industry. Amongst others, these may include: • Contact center solution providers: hardware, software & services • Outsourcers • Contact center managers and directors • Customer service directors and those involved in contact center strategy • Consultants • Journalists • Analysts • Real estate companies • Training providers • New entrants to the contact center industry • Government bodies • Academic institutes • Contact center industry organisations • Regional & national development/inward investment agencies Although this report is free of charge, no sharing, swapping, gifting, photocopying or other dissemination of this report must occur without prior written permission from ContactBabel. All figures, text and graphs are © ContactBabel. -9-
  10. 10. Chapter Two: The Structure of the North American Contact Center Industry: Market Size There are presently 56,900 contact centers in the US and 3,950 in Canada The US industry is made up of 3.07m agent positions and the Canadian industry of 290,500 agent positions Large contact centers (with over 250 agent positions) employ 34% of US staff, despite only accounting for less than 4% of physical contact center sites The retail and distribution sector has most contact centers (19%) and with finance, manufacturing, outsourcing & telemarketing, telecoms and utilities also important sectors The mean average contact center size is 54 agent positions in the US, and 74 agent positions in Canada - 10 -
  11. 11. US Contact Centers and Agent Positions by Size As the following graph shows, there are a very large number of contact center operations in the sub-100 agent position size bands, with a significant number of agent positions. Both the numbers of agent positions and contact centers decline as the size band is increased, until the realm of the large contact center (over 250 agent positions) is reached. Here, a relatively small number of large operations employ many hundreds of thousands of people in total, creating a disproportionately large pool of employment in the largest few hundred contact centers: this is how most people think of the contact center industry, and is also the place where any impact of offshoring is having its largest effect. US agent positions and contact centers by size range, 2006 30,000 600,000 25,000 Contact centers 500,000 Agent positions 20,000 400,000 Contact centers Agent positions 15,000 300,000 10,000 200,000 5,000 100,000 0 - 10-24 25-50 50-100 100-150 200-250 500- 1,000+ 150-200 250-500 1,000 Agent position size band - 11 -
  12. 12. Table 3: US agent positions and contact centers by size of contact center Size band Number of % contact Number of % of agent (agent contact centers centers agent positions positions) positions 10-24 25,250 44.4% 358,000 11.7% 25-50 16,750 29.4% 493,000 16.1% 50-100 8,650 15.2% 513,000 16.7% 100-150 1,900 3.3% 239,000 7.8% 150-200 1,400 2.5% 224,000 7.3% 200-250 950 1.7% 201,000 6.5% 250-500 1,200 2.1% 367,000 12.0% 500-1,000 480 0.8% 289,000 9.4% 1,000+ 320 0.6% 386,000 12.6% Total 56,900 100.0% 3,070,000 100.0% US contact centers by vertical market Each business sector (vertical market) has its own distinct character and place within the contact center industry. The retail and distribution sector has the largest number of contact center operations. This vertical market includes catalogue/direct mail retailers (which tend to be the largest in this sector), package couriers, retail support for large physical stores, and niche retailers. This area has been growing rapidly, supported by the massive increase in online shopping, which requires telephone support. Financial services organisations run the second-most contact centers of any business sector. This vertical market consists mainly of banks, credit card companies, insurance companies, building societies, collection agencies and credit reference agencies. The first three sub-sectors are amongst the largest users of contact centers, and many of the largest operations are within this vertical market. Several suppliers of contact center solutions have estimated that the finance sector provides between 40% and 50% of their total revenues. However, this sector has shown the most inclination to move offshore, to take advantage of labour cost differentials. Manufacturing companies account for 11% of North American contact centers, although they are generally smaller operations, dealing with customer support and sales to other companies rather than the public. The US still has a strong manufacturing base, which means that the contact center support required is proportionally larger than that found in other mature contact center industries, such as the UK. - 12 -
  13. 13. The transport and travel vertical market includes travel agents (both High Street and web-based), public transport companies, airlines, and car hire firms. 11% of the UK’s contact centers are run by these types of company. The telecoms vertical market accounts for 8.3% of operations, but has a much bigger impact on the industry as a whole, as many telecoms contact centers are a considerable size (having a mean average of 79 agent positions). This vertical market includes both fixed line and mobile operators. The services sector is a broad category taking in those contact centers which do not fit in easily elsewhere. It includes home security, directory services, legal services and home improvements companies. The IT sector is made up of both technology sales and external helpdesk operations, as well as ISPs (internet service providers). This report does not include the large numbers of internal helpdesks which support employees. The outsourcing and telemarketing vertical market consists of telemarketing companies and full-service outsourcers, both inbound and outbound. Public services contact centers cover a very wide area, from local, state and federal service supply, through to taking 911 and non-emergency calls. The sector is experiencing significant investment in its contact center operations as it tries to catch up with the private sector and allow citizens to benefit from longer hours and shorter wait times. Printing and publishing contact centers include newspaper and magazine subscription and outbound advertisement operations, along with book publishers. The utilities sector comprises those businesses selling water, fuel and electricity, although such companies increasingly try to market new services (such as internet access and telephony) to their customer base. - 13 -
  14. 14. US contact centers by vertical market Utilities Entertainment and Engineering and 2.6% Leisure Construction 2.6% 0.4% Transport and Travel 4.8% Finance Telecoms 17.1% 8.3% Food and Drink Services 2.2% 11.0% IT 5.7% Manufacturing 11.0% Retail and Distribution Medical 19.3% 1.3% Printing and Publishing Motoring 1.3% Outsourcing and 0.5% Public Services 6.6% Telemarketing 5.1% Table 4: US contact centers by vertical market Vertical market Contact centers Percentage Retail and Distribution 11,000 19.3% Finance 9,750 17.1% Manufacturing 6,250 11.0% Services 6,250 11.0% Telecoms 4,750 8.3% Public Services 3,750 6.6% IT 3,250 5.7% Outsourcing and Telemarketing 2,900 5.1% Transport and Travel 2,750 4.8% Entertainment and Leisure 1,500 2.6% Utilities 1,500 2.6% Food and Drink 1,250 2.2% Medical 750 1.3% Printing and Publishing 750 1.3% Motoring 300 0.5% Engineering and Construction 200 0.4% TOTAL 56,900 100.0% - 14 -
  15. 15. US agent positions by vertical market The financial services sector has the most agent positions, at almost 500,000, with the retail & distribution sector close behind. Telecoms, and outsourcing & telemarketing sectors both have over 300,000 agent positions, and between them, these four leading sectors account for over 55% of agent positions. US agent positions by vertical market Engineering and Construction Motoring Printing and Publishing Food and Drink Medical Entertainment and Leisure Transport and Travel Utilities Public Services Services IT Manufacturing Outsourcing and Telemarketing Telecoms Retail and Distribution Finance 0 100,000 200,000 300,000 400,000 500,000 600,000 Agent positions - 15 -
  16. 16. Table 5: US agent positions by vertical market Vertical market Agent positions Percentage Finance 494,270 16.1% Retail and Distribution 475,850 15.5% Telecoms 377,610 12.3% Outsourcing and Telemarketing 313,140 10.2% Manufacturing 245,600 8.0% IT 239,460 7.8% Services 224,110 7.3% Public Services 174,990 5.7% Utilities 159,640 5.2% Transport and Travel 156,570 5.1% Entertainment and Leisure 64,470 2.1% Medical 58,330 1.9% Food and Drink 33,770 1.1% Printing and Publishing 27,630 0.9% Motoring 21,490 0.7% Engineering and Construction 3,070 0.1% Total 3,070,000 100.0% - 16 -
  17. 17. US contact center size by vertical market The mean average sizes of contact centers by vertical market are listed below, although care should be taken when analysing these figures. The mean average may not be the most representative measure of average contact center size: dividing total agent positions by total number of contact centers gives a mean average industry size of 54 agent positions, yet 73% of contact centers have fewer than 50 agent positions. Using a mean average approach, the relatively few very large operations skew the results upwards. Table 6: Mean average US contact center size by vertical market Vertical market Mean average size (agent positions) Outsourcing and Telemarketing 108 Utilities 106 Telecoms 79 Medical 78 IT 74 Motoring 72 Transport and Travel 57 Finance 51 Public Services 47 Retail and Distribution 43 Entertainment and Leisure 43 Manufacturing 39 Printing and Publishing 37 Services 36 Food and Drink 27 Engineering and Construction 15 Mean average (all vertical markets) 54 - 17 -
  18. 18. Canadian Contact Centers and Agent Positions by Size As with the US, there are a large number of contact center operations in the sub-100 agent position size bands, with a significant number of agent positions. Generally, the numbers of agent positions and contact centers decline as the size band is increased, until the realm of the large contact center (over 250 agent positions) is reached. Here, a relatively small number of large operations employ many people, creating a disproportionately large pool of employment in the largest contact centers: this is how most people think of the contact center industry. Canadian agent positions and contact centers by size range, 2006 2,000 60,000 1,800 Contact centers 50,000 1,600 Agent positions 1,400 40,000 Contact centers Agent positions 1,200 1,000 30,000 800 20,000 600 400 10,000 200 0 -0 10-24 25-50 50-100 100-150 150-200 200-250 250-500 500-1,000 1,000+ Agent position size band - 18 -
  19. 19. Table 7: Canadian agent positions and contact centers by size of contact center Size band Number of % contact Number of % of agent (agent contact centers centers agent positions positions) positions 10-24 1,855 47.0% 40,500 14.5% 25-50 1,100 27.8% 45,000 15.5% 50-100 550 13.9% 48,000 16.3% 100-150 125 3.2% 17,500 6.2% 150-200 90 2.3% 16,500 5.7% 200-250 70 1.8% 16,500 5.7% 250-500 100 2.5% 40,500 14.0% 500-1,000 40 1.0% 31,500 10.5% 1,000+ 20 0.5% 34,500 11.6% Total 3,950 100.0% 290,500 100.0% Canadian contact centers by vertical market There are a lot of similarities between the Canadian and US economies (see the section above), which impacts upon each contact center industry in a similar way. However, the outsourcing and telemarketing industry in Canada has a higher proportion of contact center operations than the in US (8.9% vs 5.1%). In large part, this is due to the work carried out by lower cost Canadian outsourcers on behalf of US businesses, as a lower-risk form of offshoring. - 19 -
  20. 20. Canadian contact centers by vertical market Utilities Engineering and Construction Entertainment and 3.8% Leisure 0.6% Transport and Travel 3.2% 5.1% Finance Telecoms 15.8% 7.6% Services Food and Drink 8.9% 2.5% IT 6.3% Retail and Distribution Manufacturing 16.5% 9.5% Medical 1.3% Printing and Publishing 1.3% Outsourcing and Public Services Motoring Telemarketing 8.2% 0.6% 8.9% Table 8: Canadian contact centers by vertical market Vertical market Contact centers Percentage Retail and Distribution 650 16.5% Finance 625 15.8% Manufacturing 375 9.5% Outsourcing and Telemarketing 350 8.9% Services 350 8.9% Public Services 325 8.2% Telecoms 300 7.6% IT 250 6.3% Transport and Travel 200 5.1% Utilities 150 3.8% Entertainment and Leisure 125 3.2% Food and Drink 100 2.5% Medical 50 1.3% Printing and Publishing 50 1.3% Engineering and Construction 25 0.6% Motoring 25 0.6% TOTAL 3,950 100.0% - 20 -
  21. 21. Canadian agent positions by vertical market As in the US, the financial services sector has the most agent positions, at over 45,000, although the outsourcing & telemarketing sector is in second place in Canada, with retail & distribution close behind. Canadian agent positions by vertical market Engineering and Construction Motoring Printing and Publishing Food and Drink Medical Entertainment and Leisure Services Transport and Travel Utilities Manufacturing Public Services IT Telecoms Retail and Distribution Outsourcing and Telemarketing Finance 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000 Agent positions - 21 -
  22. 22. Table 9: Canadian agent positions by vertical market Vertical market Agent positions Percentage Finance 45,250 15.6% Outsourcing and Telemarketing 41,250 14.2% Retail and Distribution 40,000 13.8% Telecoms 32,500 11.2% IT 23,750 8.2% Public Services 21,250 7.3% Manufacturing 17,750 6.1% Utilities 17,500 6.0% Transport and Travel 15,750 5.4% Services 15,000 5.2% Entertainment and Leisure 7,000 2.4% Medical 6,000 2.1% Food and Drink 3,750 1.3% Printing and Publishing 2,000 0.7% Motoring 1,250 0.4% Engineering and Construction 500 0.2% Total 290,500 100.0% - 22 -
  23. 23. Canadian contact center size by vertical market The mean average sizes of contact centers by vertical market are listed below, although care should be taken when analysing these figures. The mean average may not be the most representative measure of average contact center size: dividing total agent positions by total number of contact centers gives a mean average industry size of 74 agent positions, yet 75% of contact centers have fewer than 50 agent positions. Using a mean average approach, the relatively few very large operations skew the results upwards. Table 10: Mean average Canadian contact center size by vertical market Vertical market Mean average size (agent positions) Medical 120 Outsourcing and Telemarketing 118 Utilities 117 Telecoms 108 IT 95 Transport and Travel 79 Finance 72 Public Services 65 Retail and Distribution 62 Entertainment and Leisure 56 Motoring 50 Manufacturing 47 Services 43 Printing and Publishing 40 Food and Drink 38 Engineering and Construction 20 Mean average (all vertical markets) 74 - 23 -
  24. 24. Chapter Three: The Structure of the US Contact Center Industry: Geographical Location 3.7% of the US’s employed population work within the contact center industry The South of the US has most agent positions, yet the contact center industry is least vital to that region in terms of the proportion of the employed population working in the industry The Middle Atlantic and East North Central (aka Great Lakes) divisions have the most contact center staff, with over 900,000 working in each division In terms of the importance of the contact center industry to the division, there is a significant North-South divide, with Northern divisions relying more heavily on the contact center industry for employment Although we advise caution when viewing state-wide contact center estimations, it seems that Texas, New York and California have the most agent positions and contact centers A note on Canadian contact center distribution This chapter does not consider the geographical distribution of contact centers in Canada. This is because the North American Contact Center Directory, upon which this chapter is based, does not contain the volume of Canadian contact centers which we need in order to be confident of distribution by state/province level. Neither is Canada divided up into meaningful and significant regions or divisions, in the way of the US, which would allow better estimations (as in the rest of this chapter). For those requiring some idea of the geography of the Canadian contact center industry, we tentatively hypothesize from our directory of operations that Ontario contains by far the most contact centers and agent positions, with around 75% and 85% respectively. Quebec and Alberta seem to have around 15,000 agent positions each, with British Columbia being the only other significant area of contact center activity at around half of these agent positions. We must again urge readers to note the extreme uncertainty of these figures, which are included only for completeness’s sake. - 24 -
  25. 25. The US contact center industry structure by region “Region” is the top-level of US geographical segmentation. Very widely- used, it divides the US into four distinct large regions. Table 11: The US contact center industry by region % employed Average Agent Contact Working in contact size Region positions Jobs centers population centers (APs) West 583,159 991,370 12,246 32,392,000 3.1% 48 North-East 810,399 1,377,678 13,344 26,359,000 5.2% 61 Midwest 791,838 1,346,125 14,230 32,724,000 4.1% 56 South 884,604 1,503,827 17,080 50,235,000 3.0% 52 TOTAL 3,070,000 5,219,000 56,900 141,710,000 3.7% 54 Although the South has most agent positions and contact centers, the importance of the contact center industry to this region is less than elsewhere, employing only 3.0% of the employed population. Contact centers are especially important in the North-East – especially around New York and parts of New England. - 25 -
  26. 26. The US contact center industry structure by division This section of the report analyses the US contact center industry by nine divisions. A division is a group of geographically similar states, used widely within the US and is a generally recognised official grouping. It has greater granularity than the regional level provides, but this means the possibility of inaccuracy further increases. Contact centers by US division ME WA MT ND MN OR SD WI NY ID MI WY IO PA NE IL IN OH NV CA UT CO Contact KS MO KY WV VA centers TN NC AZ NM OK <2.5k AR SC MS AL GA 2.5-5.0k TX LA 5.0-7.5k FL AK >7.5k - 26 -
  27. 27. Agent positions by US division ME WA MT ND MN OR SD WI NY ID MI WY IO PA NE IL IN OH NV CA UT CO Agent KS MO KY WV VA positions TN NC AZ NM OK <200k AR SC MS AL GA 200-300k TX LA 300-400k FL AK 400-500k >500k - 27 -
  28. 28. Contact center employment by US division ME WA MT ND MN OR SD WI NY ID MI WY IO PA NE IL IN OH NV CA UT CO KS MO KY WV VA TN NC AZ NM OK % of working AR SC population employed in contact centers MS AL GA TX LA <3% FL 3-4% AK 4-5% >5% Table 12: The US contact center industry by division % employed Average Agent Contact Working in contact size Division positions Jobs centers population centers (APs) Pacific 352,292 598,896 8,864 22,536,000 2.7% 40 Mountain 230,868 392,476 3,381 9,856,000 4.0% 68 Middle Atlantic 549,324 933,851 8,746 19,160,000 4.9% 63 New England 261,074 443,826 4,598 7,199,000 6.2% 57 West North Central 256,423 435,919 4,599 10,387,000 4.2% 56 East North Central 535,415 910,206 9,631 22,337,000 4.1% 56 South Atlantic 450,405 765,689 8,609 26,790,000 2.9% 52 East South Central 108,596 184,613 2,241 7,932,000 2.3% 48 West South Central 325,603 553,525 6,231 15,513,000 3.6% 52 TOTAL 3,070,000 5,219,000 56,900 141,710,000 3.7% 54 - 28 -
  29. 29. An interesting pattern thrown up here is the North-South divide along the importance of contact centers to the division. The southern divisions – despite a large number of agent positions and contact centers in the Southern Atlantic division – do not rely on the contact center industry to the same extent as the New England and Middle Atlantic divisions, for example. Unsurprisingly, the raw contact center and agent position distribution seems to follow the general areas of high population – the North-East, Texas, Eastern Seaboard, California and Great Lakes. - 29 -
  30. 30. The US contact center industry structure by state Please note – the following figures are estimations of contact center and agent position numbers at state level. Due to the nature of statistical analysis, operating at such a granular level may decrease the level of accuracy. For example, the presence or absence of a very large contact center may be largely statistically insignificant at the national or regional level, but may play an important part in determining state-wide data. For this reason, we recommend that readers exercise extreme caution when using figures from the following section. We are hesitant about analysing specific state-wide data, due to the nature of the small sample sizes at this level of granularity, so there is no commentary of this section. Contact centers by US state ME WA MT ND MN OR SD WI NY ID MI WY IO PA NE IL IN OH NV CA UT CO Contact KS MO KY WV VA centers TN NC AZ NM OK <250 AR SC MS AL GA 250-500 TX LA 500-1,000 FL AK 1,000-2,000 >2,000 - 30 -
  31. 31. Agent positions by US state ME WA MT ND MN OR SD WI NY ID MI WY IO PA NE IL IN OH NV CA UT CO Agent KS MO KY WV VA positions TN NC AZ NM OK <10k AR SC MS AL GA 10-25k TX LA 25-50k FL AK 50-100k 100-200k >200k - 31 -
  32. 32. Contact center employment by US state ME WA MT ND MN OR SD WI NY ID MI WY IO PA NE IL IN OH NV CA UT CO KS MO KY WV VA TN NC AZ NM OK % of working AR SC population employed in contact centers MS AL GA TX LA <2% FL 2-4% AK 4-6% >6% - 32 -
  33. 33. Table 13: The US contact center industry by state % employed Average Agent Contact Working in contact size State positions Jobs centers population centers (APs) Alabama 30,628 52,068 825 2,069,000 2.5% 37 Alaska 3,079 5,234 80 316,000 1.7% 38 Arizona 75,333 128,066 1,219 2,710,000 4.7% 62 Arkansas 29,717 50,519 570 1,295,000 3.9% 52 California 241,041 409,769 6,722 16,747,000 2.4% 36 Colorado 52,463 89,187 845 2,419,000 3.7% 62 Connecticut 72,811 123,779 1,120 1,728,000 7.2% 65 DC 18,327 31,157 177 277,000 11.2% 104 Delaware 12,645 21,497 138 420,000 5.1% 92 Florida 136,463 231,987 2,476 8,329,000 2.8% 55 Georgia 78,656 133,714 1,395 4,346,000 3.1% 56 Hawaii 2,089 3,551 138 617,000 0.6% 15 Idaho 5,018 8,531 177 711,000 1.2% 28 Illinois 185,074 314,626 3,243 6,101,000 5.2% 57 Indiana 37,279 63,374 924 3,035,000 2.1% 40 Iowa 38,768 65,905 727 1,584,000 4.2% 53 Kansas 13,830 23,510 590 1,401,000 1.7% 23 Kentucky 35,270 59,959 590 1,878,000 3.2% 60 Louisiana 10,972 18,652 334 1,923,000 1.0% 33 Maine 27,953 47,520 431 677,000 7.0% 65 Maryland 20,312 34,531 767 2,814,000 1.2% 26 Massachusetts 97,205 165,249 1,848 3,203,000 5.2% 53 Michigan 38,487 65,429 1,258 4,754,000 1.4% 31 Minnesota 62,585 106,395 1,376 2,829,000 3.8% 45 Mississippi 11,877 20,191 216 1,237,000 1.6% 55 Missouri 86,219 146,572 1,199 2,862,000 5.1% 72 Montana 2,353 4,000 157 474,000 0.8% 15 Nebraska 46,018 78,231 432 949,000 8.2% 106 Nevada 18,599 31,619 275 1,167,000 2.7% 68 New Hampshire 23,513 39,973 373 706,000 5.7% 63 New Jersey 117,255 199,334 1,926 4,236,000 4.7% 61 New Mexico 16,243 27,613 177 887,000 3.1% 92 New York 256,495 436,041 4,619 8,944,000 4.9% 56 North Carolina 53,333 90,667 1,297 4,106,000 2.2% 41 North Dakota 3,962 6,735 177 347,000 1.9% 22 Ohio 128,708 218,803 2,418 5,550,000 3.9% 53 Oklahoma 17,767 30,204 511 1,665,000 1.8% 35 Oregon 48,660 82,721 806 1,746,000 4.7% 60 Pennsylvania 175,574 298,477 2,201 5,980,000 5.0% 80 Rhode Island 28,243 48,014 275 541,000 8.9% 103 - 33 -
  34. 34. % employed Average Agent Contact Working in contact size State positions Jobs centers population centers (APs) South Carolina 29,692 50,476 590 1,939,000 2.6% 50 South Dakota 5,042 8,571 98 415,000 2.1% 51 Tennessee 30,820 52,395 609 2,748,000 1.9% 51 Texas 267,147 454,150 4,815 10,630,000 4.3% 55 Utah 49,612 84,340 413 1,214,000 6.9% 120 Vermont 11,349 19,293 550 344,000 5.6% 21 Virginia 87,651 149,007 1,376 3,798,000 3.9% 64 Washington 57,423 97,619 1,120 3,110,000 3.1% 51 West Virginia 13,325 22,653 393 761,000 3.0% 34 Wisconsin 145,867 247,973 1,789 2,897,000 8.6% 82 Wyoming 11,247 19,120 118 274,000 7.0% 95 TOTAL 3,070,000 5,219,000 56,900 141,710,000 3.7% 54 - 34 -
  35. 35. Chapter Four: Market Forecasts to 2010 Between 2006 and 2010, the US contact center industry will shrink by 2.8% in terms of contact centers, and by 2.0% in agent positions. The Canadian industry will grow by 5.0% and 8.6% respectively The North American contact center industry will experience a net loss of over 55,000 jobs between 2006 and 2010 Within the US, the finance, outsourcing and telecoms vertical markets will shed over 110,000 jobs between 2006 and 2009 In Canada, the outsourcing, public sector and retail/distribution sectors will add almost 26,000 jobs between 2006 and 2009 Investment in technology in US contact centers will increase by 11% over the 2006-2010 period, moving from $3.36bn to $3.73bn Canadian contact center investment will grow more sharply, from $314 in 2006 to $385 in 2010, a growth rate of over 22% in that timescale - 35 -
  36. 36. US contact centers, 2004-2010 US contact centers, 2004-2010 60,000 0.0% 55,000 -0.2% 50,000 45,000 Contact centers Growth rate (%) -0.4% 40,000 Contact centers Growth rate (%) 35,000 -0.6% 30,000 25,000 -0.8% 20,000 -1.0% 15,000 10,000 -1.2% 5,000 0 -1.4% 2004 2005 2006 2007 2008 2009 2010 Table 14: US contact centers, 2004-2010 Year Contact centers % growth Average size (agent positions) 2004 58,300 -1.0% 53.4 2005 57,600 -1.2% 53.6 2006 56,900 -1.2% 54.0 2007 56,300 -1.1% 54.2 2008 55,900 -0.7% 54.4 2009 55,600 -0.5% 54.5 2010 55,300 -0.5% 54.4 The years between 1990 and 2000 saw the greatest increase in the number of contact centers opening. Today, most companies who can benefit from a contact center have already done so, and are - in the main - either adding new agents to existing premises or are looking more or less seriously at offshore as a place to expand and/or move contact center operations. Although there are now many fewer announcements of new US operations opening, numerous studies of existing contact centers show that many are still adding considerable numbers of staff. However, the US is the most mature contact center industry in the world, and there is also a great deal - 36 -
  37. 37. of consolidation, nearshoring (mainly to Canada, although also to Mexico), and offshoring (the Philippines and India are the main destinations). This seems to have created a small net decline within the US contact center industry, which we expect to continue. Some operations will close over the next four years – more likely through consolidation than movement offshore. Many operations are likely to be of a significant size, and will impact on agent numbers. In the main, existing operations will continue to grow very gradually or remain stable, although the increased use of self-service will cause some closures, especially of multi-site operations. - 37 -
  38. 38. US agent positions, 2004-2010 US agent positions, 2004-2010 0.00% 3,000 2,500 -0.50% Agent positions (000s) Growth rate (%) 2,000 -1.00% Agent positions Growth rate (%) 1,500 -1.50% 1,000 -2.00% 500 0 -2.50% 2004 2005 2006 2007 2008 2009 2010 Table 15: US agent positions, 2004-2010 Year Agent positions % growth 2004 3,115,000 -0.3% 2005 3,090,000 -0.8% 2006 3,070,000 -0.7% 2007 3,050,000 -0.7% 2008 3,040,000 -0.3% 2009 3,030,000 -0.3% 2010 3,010,000 -0.7% Consolidation and offshoring will impact agent numbers negatively, although we believe that the growing movement to self-service – whether web- or phone-based – will have a longer term effect. In particular, large parts of the US population are now extremely web-literate and happy to manage bills and technical help online as their first choice. - 38 -
  39. 39. US vertical market forecasts, 2009 Table 16: US contact centers by vertical market, 2009 Contact % of overall contact % change Vertical market centers, 2009 centers, 2009 06-09 Retail and Distribution 11,200 20.1% +1.8% Finance 9,100 16.4% -6.7% Services 6,300 11.3% +0.8% Manufacturing 6,150 11.1% -1.6% Telecoms 4,350 7.8% -8.4% Public Services 3,950 7.1% +5.3% IT 3,100 5.6% -4.6% Outsourcing and Telemarketing 2,650 4.8% -8.6% Transport and Travel 2,650 4.8% -3.6% Entertainment and Leisure 1,520 2.7% +1.3% Utilities 1,400 2.5% -6.7% Food and Drink 1,220 2.2% -2.4% Medical 770 1.4% +2.7% Printing and Publishing 750 1.3% +0.0% Motoring 300 0.5% +0.0% Engineering and Construction 190 0.3% -5.0% Total 55,600 100.0% -2.3% By 2008, the gap will have grown between the retail and distribution vertical market and the finance sector. Financial services businesses have been the main ones to move offshore, and coupled with the continuing consolidation of the industry and its contact centers, we expect to see a stagnation in the number of finance contact centers. The increasing use of account self-management options (voice and web self-service) in the finance industry adds to this effect. Telecoms and utility contact centers are also likely to be under the same competitive pressures, with somewhat more dramatic results, especially due to the round of consolidation caused by “triple-play” companies (TV, Internet and voice traffic) emerging from the telecoms sector. The main area of growth in contact center numbers will be in the public sector, where eGovernment initiatives continue to grow, and the formalization of departmental customer handling leads to the growth in contact centers. The retail & distribution sector will continue to grow, driven in part by the need to support online interactions. The outsourcing & telemarketing sector looks to be in for a decline, as more work moves offshore and nearshore. - 39 -
  40. 40. Table 17: US agent positions by vertical market, 2009 Agent Vertical market positions, % of overall agent % change 2009 positions, 2009 06-09 Retail and Distribution 480,000 15.8% +0.9% Finance 472,500 15.6% -4.4% Telecoms 355,000 11.7% -6.0% Outsourcing and Telemarketing 292,500 9.7% -6.6% Manufacturing 244,000 8.1% -0.7% IT 232,500 7.7% -2.9% Services 230,000 7.6% +2.6% Public Services 191,000 6.3% +9.1% Transport and Travel 162,000 5.3% +3.5% Utilities 155,000 5.1% -2.9% Entertainment and Leisure 67,500 2.2% +4.7% Medical 62,000 2.0% +6.3% Food and Drink 33,500 1.1% -0.8% Printing and Publishing 28,000 0.9% +1.3% Motoring 21,500 0.7% +0.0% Engineering and Construction 3,000 0.1% -2.3% Total 3,030,000 100.0% -1.3% Major growth will come from the public services sector, which is a long way behind the contact center curve that the private sector has been on for many years. The Entertainment & Leisure, Medical and the Transport & Travel sectors will experience some agent position growth as well. Due to offshoring and triple-play-driven consolidation, and a move towards web- or SMS-based contact – the US’s telecoms and utilities contact center sectors will be somewhat smaller in 2009 than today. All told, the US contact center industry will be 1.3%, or 40,000 agent positions smaller in 2009 than in 2006. - 40 -
  41. 41. US employment forecasts, 2009 The public sector will add considerably to its contact center employment figures, but there is little to cheer in the rest of the industry, with a net loss of 68,000 jobs predicted over the next three years. The finance, telecoms and outsourcing & telemarketing sectors are responsible for most of this, with these three sectors alone accounting for losses of over 110,000 jobs. Table 18: US contact center employment changes by vertical market, 2006-2009 Difference in contact center employment, Vertical market 2006-2009 Public Services +27,217 Services +10,013 Transport and Travel +9,231 Retail and Distribution +7,055 Medical +6,239 Entertainment and Leisure +5,151 Printing and Publishing +629 Motoring +17 Engineering and Construction -119 Food and Drink -459 Manufacturing -2,720 Utilities -7,888 IT -11,832 Outsourcing and Telemarketing -35,088 Finance -37,009 Telecoms -38,437 Total -68,000 - 41 -
  42. 42. Canadian contact centers, 2004-2010 Canadian contact centers, 2004-2010 4,500 3.0% 4,000 2.5% 3,500 Contact centers Growth rate (%) 3,000 2.0% 2,500 Contact centers Growth rate (%) 1.5% 2,000 1,500 1.0% 1,000 0.5% 500 0 0.0% 2004 2005 2006 2007 2008 2009 2010 Table 19: Canadian contact centers, 2004-2010 Year Contact centers % growth Average size (agent positions) 2004 3,750 1.4% 73.2 2005 3,850 2.7% 73.0 2006 3,950 2.6% 73.5 2007 4,050 2.5% 73.7 2008 4,100 1.2% 74.4 2009 4,150 1.2% 74.9 2010 4,150 0.0% 76.0 The Canadian contact center industry is at a similar point to the UK’s – still growing, but the rate and amount of growth declining each year. The Canadian industry is still opening some contact centers as it picks up work from the US. Although some operations will close over the next three years – more likely through consolidation than movement offshore – these will be relatively few in number, although the operations are likely to be of a significant size. In the main, existing operations will continue to grow gradually, and there will continue to be a steady opening of new or returning contact centers or continuing formalization of existing operations, especially at the lower end of the industry. - 42 -
  43. 43. Canadian agent positions, 2004-2010 Canadian agent positions, 2004-2010 350,000 3.50% 300,000 3.00% 250,000 2.50% Agent positions Growth rate (%) 200,000 2.00% Agent positions Growth rate (%) 150,000 1.50% 100,000 1.00% 50,000 0.50% 0 0.00% 2004 2005 2006 2007 2008 2009 2010 Table 20: Canadian agent positions, 2004-2010 Year Agent positions % growth 2004 274,600 n/a 2005 281,200 2.4% 2006 290,500 3.3% 2007 298,500 2.8% 2008 305,000 2.2% 2009 311,000 2.0% 2010 315,500 1.4% Growth in the Canadian contact center industry is still definite, although it is at a gentler pace than has been seen before. 25,000 agent positions (over 40,000 actual jobs) will be added between 2006 and 2010. - 43 -
  44. 44. Canadian vertical market forecasts, 2009 Table 21: Canadian contact centers by vertical market, 2009 Contact % of overall contact % change Vertical market centers, 2009 centers, 2009 06-09 Retail and Distribution 705 17.0% +8.5% Finance 610 14.7% -2.4% Manufacturing 400 9.6% +6.7% Outsourcing and Telemarketing 395 9.5% +12.9% Services 375 9.0% +7.1% Public Services 360 8.7% +10.8% Telecoms 285 6.9% -5.0% IT 270 6.5% +8.0% Transport and Travel 210 5.1% +5.0% Utilities 145 3.5% -3.3% Entertainment and Leisure 135 3.3% +8.0% Food and Drink 105 2.5% +5.0% Medical 53 1.3% +6.0% Printing and Publishing 52 1.3% +4.0% Engineering and Construction 25 0.6% +0.0% Motoring 25 0.6% +0.0% Total 4,150 100.0% +5.1% The retail & distribution sector will add some new contact centers over the next 3 years, as the increasing use of web-based retailers and the ineffectiveness of email support opens up avenues for contact center work. The outsourcing & telemarketing sector (driven partially by US work) will increase, as will the formalization of the public sector’s contact operations. Consolidation in the telecoms and utilities industries will create a small decline in the number of contact centers in these sectors. - 44 -
  45. 45. Table 22: Canadian agent positions by vertical market, 2009 Agent % of overall agent % change Vertical market positions, 2009 positions, 2009 06-09 Outsourcing and Telemarketing 48,750 15.7% +18.2% Finance 44,500 14.3% -1.7% Retail and Distribution 44,500 14.3% +11.3% Telecoms 31,500 10.1% -3.1% IT 25,000 8.0% +5.3% Public Services 24,500 7.9% +15.3% Manufacturing 19,250 6.2% +8.5% Utilities 17,250 5.5% -1.4% Transport and Travel 17,000 5.5% +7.9% Services 16,350 5.3% +9.0% Entertainment and Leisure 7,750 2.5% +10.7% Medical 6,500 2.1% +8.3% Food and Drink 4,100 1.3% +9.3% Printing and Publishing 2,175 0.7% +8.8% Motoring 1,350 0.4% +8.0% Engineering and Construction 525 0.2% +5.0% Total 311,000 100.0% +7.1% Major growth will come from the retail & distribution sector, outsourcing & telemarketing and also public services, which is a long way behind the contact center curve that the private sector has been on for many years. Most sectors will see gentle growth, although finance, utilities and telecoms may see some small decline. - 45 -
  46. 46. Canadian employment forecasts, 2009 The outsourcing & telemarketing sector will add over 12,000 jobs to the Canadian contact center industry over the next three years, with the retail & distribution and public service sectors also adding significant employment figures. All told, an increase in employment of over 35,000 contact center staff is expected, with most coming from growth within existing contact centers. Table 23: Canadian contact center employment changes by vertical market, 2006-2009 Difference in contact center employment, Vertical market 2006-2009 Outsourcing and Telemarketing +12,750 Retail and Distribution +7,650 Public Services +5,525 Manufacturing +2,550 Services +2,295 IT +2,125 Transport and Travel +2,125 Entertainment and Leisure +1,275 Medical +850 Food and Drink +595 Printing and Publishing +298 Motoring +170 Engineering and Construction +43 Utilities -425 Finance -1,275 Telecoms -1,700 Total +34,850 - 46 -
  47. 47. Chapter Five: Inbound and Outbound Activity US outbound activity is currently at just over 30%, with Canada’s being slightly lower at 28.8% There are over 1 million outbound agent positions within North America Outbound activity is highest in the outsourcing & telemarketing sector, with the finance and retail & distribution sectors also playing a large part in outbound calling There will be around 266 billion minutes of inbound calling into North American contact centers in 2006 - 47 -
  48. 48. US: inbound/outbound activity by size of contact center US inbound and outbound activity by size of contact center AVERAGE 1,001+ 501-1,000 Agent positions 251-500 201-250 151-200 101-150 Inbound 51-100 Outbound 25-50 10-24 0% 20% 40% 60% 80% 100% Table 24: US: outbound activity by size of contact center Agent positions % of outbound activity 10-24 27.2% 25-50 31.5% 51-100 29.6% 101-150 32.1% 151-200 34.8% 201-250 37.6% 251-500 30.7% 501-1,000 31.9% 1,001+ 28.2% MEAN AVERAGE 30.3% There is little linear correlation between contact center size and amount of outbound calling. However, mid-sized contact centers seem to do somewhat more outbound calling than either small or very large operations, which may use outsourcers and telemarketing firms more. (The term “outbound agent equivalent” describes the number of exclusively-outbound, full-time agents required. In practice, not all - 48 -
  49. 49. outbound work is done by outbound-only agents, hence the need for “outbound agent equivalents”). Table 25: US: outbound agent positions (equivalent) by size of contact center Size band (agent positions) Outbound agent positions (equivalent) 10-24 97,512 25-50 155,250 51-100 151,686 101-150 76,754 151-200 77,961 201-250 75,593 251-500 112,694 501-1,000 92,148 1,001+ 109,006 Total 931,485 Small (sub-100 seat) contact centers have very significant numbers of outbound agent positions, but more as a factor of the overall size of the segment, rather than any focus of small contact centers upon outbound calling. - 49 -
  50. 50. US: inbound/outbound activity by vertical market US inbound and outbound activity by vertical market Inbound TOTAL Outbound Motoring Medical Engineering and Construction Public Services Entertainment and Leisure Vertical market Transport and Travel Utilities Telecoms Retail and Distribution Finance Services Manufacturing Food and Drink IT Printing and Publishing Outsourcing and Telemarketing 0% 20% 40% 60% 80% 100% - 50 -
  51. 51. Table 26: US: equivalent outbound agent positions by vertical market Vertical market Outbound activity Outbound FTEs Outsourcing and Telemarketing 49.6% 154,427 Finance 29.8% 146,594 Retail and Distribution 26.7% 126,054 Telecoms 25.4% 95,341 IT 36.1% 85,902 Manufacturing 30.4% 74,193 Printing and Publishing 38.6% 67,164 Services 30.0% 66,917 Utilities 24.0% 38,044 Transport and Travel 23.2% 36,043 Entertainment and Leisure 22.0% 14,069 Food and Drink 33.3% 11,177 Medical 13.3% 7,727 Public Services 21.1% 5,794 Motoring 7.3% 1,559 Engineering and Construction 15.8% 481 Mean average 30.3% 931,485 The outsourcing and telemarketing sector has the biggest focus on outbound calling, with half of activity being aimed outwards, rather than being connected with inbound customer service. When considering the amount of offshoring that this sector has weathered in recent years, it is testament to the size of this industry segment that it still has more outbound FTEs (full-time equivalents) than any other sector. The finance vertical market has the largest number of outbound agents, involved in debt collection, persuading customers to change financial products (e.g. credit cards) and increasingly, cross-selling and up-selling to existing customers. Businesses are aware that one of the key moves towards increased profitability is to get customers purchasing multiple products, e.g. a personal loan, a current account, a credit card and insurance from the same provider. A significant proportion of outbound calling is now being done offshore (especially for lower value products), so we expect to see the number of outbound FTEs in this sector in the US decreasing significantly over the next two to three years. - 51 -
  52. 52. US: inbound call volumes Table 27: US: inbound call minutes by vertical market Vertical market Minutes inbound per % of all inbound year (billions) activity Retail and Distribution 38.8 16.3% Finance 39.6 16.0% Telecoms 35.6 14.6% Outsourcing and Telemarketing 19.4 8.0% Manufacturing 13.7 7.8% Services 15.0 7.1% IT 13.6 6.2% Public Services 19.0 5.6% Utilities 13.2 5.6% Transport and Travel 17.4 5.4% Medical 5.6 2.3% Entertainment and Leisure 5.6 2.3% Food and Drink 2.5 1.0% Motoring 1.9 0.9% Printing and Publishing 2.2 0.8% Engineering and Construction 0.3 0.1% Total 243.2 100.0% Table 28: US: inbound call minutes by size of contact center Size band Minutes inbound per year % of all inbound activity (agent positions) (millions) 11-24 27.3 11.2% 25-50 36.6 15.0% 51-100 40.6 16.7% 101-150 19.0 7.8% 151-200 17.9 7.4% 201-250 15.8 6.5% 251-500 30.3 12.5% 501-1,000 23.1 9.5% 1,001+ 32.5 13.4% Total 243.2 100.0% The preceding tables are estimates of the amount of inbound call minutes per year into US contact centers. They are based upon proportions of inbound and outbound activity and agent position numbers from this report, with averages of call time and duration applied to them. - 52 -
  53. 53. ContactBabel believes there are around 243 billion inbound call minutes per year into US contact centers. Outbound call statistics have not been included, as it is more difficult to estimate the number of outbound minutes. Opinion is divided on whether to count unconnected calls and calls to answerphones, and the length of outbound calls also varies enormously, making average outbound call lengths misleading. The retail & distribution and finance vertical markets have around 16% of all inbound traffic each, with the telecoms sector also playing a significant role. By size band, the smallest contact centers are most important, with around 43% of inbound traffic terminating in contact centers with fewer than 100 agent positions. However, the very large contact centers (over 250 seats) are the most visible and make an attractive target for suppliers, handling over 35% of all inbound calls. - 53 -

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