Logo
BodyBGTop
Ovum Expects Home-Based Agents to Soar by 2017
The annual growth rate is twice that of the brick-and-mortar contact center outsourcing market.
For the rest of the June 2014 issue of CRM magazine please click here
Page 1



Globally, the number of customer service reps working at home will exceed 100,000 this year and climb to 160,000 in 2017, according to a report from analyst firm Ovum. This represents approximately twice the rate of growth expected in the brick-and-mortar contact center outsourcing market.

The biggest reason for the growth in the home-based model comes down to simple economics, according to Peter Ryan, principal analyst in Ovum's IT Services Practice. In the United States, the average cost per agent in a contact center is $26 per hour, and home-based agents cost between 5 percent and 10 percent less than that, he says. "You're taking away a huge amount of overhead."

Additionally, home-based agents tend to be better educated and more experienced and average between 35 and 45 years of age, according to Ryan. "And with home-based agents, you tend to have less of a problem with retention, so you're not factoring in costs associated with recruiting and training new agents all the time," he adds.

Home-based agents still can't compete on cost with outsourced agents in some foreign locations, such as India and the Philippines—where the average per-agent cost per hour is $13 to $15—but Ryan says they don't have to. "Where home-based agents compete and win is in the quality of the service interaction," he states.

U.S. third-party contact center outsourcing services providers make up about 90 percent of the global at-home agent market, but Ryan has seen interest growing in western Europe, Canada, and Australia.

Forrester Research, in a report released last year, projected that 34 percent of U.S. contact center outsourcing companies will be investing in the work-at-home area this year "to provide their clients with greater business agility to respond to peaks and troughs in demand," according to principal analyst Kate Leggett.

So far, these firms have had no problem recruiting high-caliber agents for their work-at-home programs, but Ryan says there are signs that attrition within this customer service segment is starting to creep up, for reasons that are not quite clear. "To maintain a sizable pool of available agents, Ovum recommends that outsourcers seek out otherwise unexplored potential pockets of workers," Ryan contends.

Among the companies that are contracting with outsourcing firms for their at-home agent programs, Ovum's analysis points to the healthcare vertical as one of the most aggressive. Currently, home-based agents account for about 8 percent of the total healthcare agent pool, but Ovum expects that to increase to 13 percent by 2017. In the financial services sector, the proportion of total home-based agents is slated for modest growth, from 11 percent in 2013 to 13 percent in 2017. Firms in the retail and telecommunications spaces are also expected to increase their use of home-based agents, according to Ryan.

And as the industries hiring home-based agents change, so, too, are the types of services home-based agents are being asked to provide. "Outsourced home-based agents are starting to diversify beyond strict customer care functions to managing more complex inquiries across multiple channels," Ryan says.

Technical support is likely to see pronounced growth over the next four years, as is the need for home-based agents to handle interactions on non-voice channels, such as email, chat, text messaging, and social media, Ryan suggests.

Despite its promise, enterprises must fully investigate and understand the risks of adopting an outsourced home agent strategy. The use of third-party home agents is a viable alternative to traditional delivery methods for some firms, but this move requires significant reflection on the part of prospective enterprises. "They need to decide if that model is right for their business, their market, and their company culture," Ryan says.

Then, you need to decide if you want to hire your own agents or work through a third-party contact center services provider. It's certainly easier to let a third-party firm handle all the specifics, but even then, lingering perception issues around data security, supervision concerns, broader cultural concerns, and infrastructure worries have hampered the ability of outsourcers to grow their prospective client lists. Ryan doesn't expect this to be a problem for very long, though.

"The more companies become comfortable with the idea, the more willing they will be to take the risk," he says. "If you are comfortable with that business model, there is a lot that agents at home have to offer. It's a win-win for the businesses that are willing to do it."


Page 1
To contact the editors, please email editor@destinationCRM.com
Every month, CRM magazine covers the customer relationship management industry and beyond. To subscribe, please visit http://www.destinationCRM.com/subscribe/.
Related Articles
The company maintains high standards with telecommuting agents using Envision's Click2Coach.
Maximize contact center results with seven best practices.
Labor rates are no longer the main concern as companies consider outsourcing their contact centers.
At-home agents can be as productive, if not more so, as those in the contact center.
 
Search
Popular Articles
 

BodyBGRight
Home | Get CRM Magazine | CRM eWeekly | CRM Topic Centers | CRM Industry Solutions | CRM News | Viewpoints | Web Events | Events Calendar
DestinationCRM.com RSS Feeds RSS Feeds | About destinationCRM | Advertise | Getting Covered | Report Problems | Contact Us