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APAC Fastest Growing Region for Contact Center Services

Asia Pacific Fastest Growing Region for Contact Center Services, Finds
Frost & Sullivan

New Zealand market to rebound strongly in 2012, 3% CAGR through to

Auckland, 11 July, 2012 – The Asia Pacific (APAC) region recorded a 9.7
percent growth in contact center agent seats to reach 2.5 million in 2011
and is expected to grow at a compound annual growth rate (CAGR) of 8.1
percent to touch 4.0 million by 2018.

To meet rising customer demand, enterprises are reviving expenditure on
customer service and APAC is expected to demonstrate the highest growth in
the global contact center outsourcing in 2012 and beyond.

Frost & Sullivan’s new analysis, Assessment of the Asia-Pacific Contact
Center Market, (, finds that the Asia
Pacific region had 3.48 million agent seats in 2011 and estimates this to
reach 5.9 million in 2018.

The New Zealand contact center market was estimated to boast close to
30,000 seats at the end of 2011, a mere 1% decline from 2010. Frost &
Sullivan ICT Industry Manager Krishna Baidya says this can be contributed
to a lingering effect of the economic slowdown resulting in cut backs in
outsourcing or exploring a lower cost base in line with reducing
operational costs.

However, the industry is expected to rebound strongly in 2012. “New Zealand
continues to serve the Australian market as the near-shore destination
competing against other APAC offshore destinations. Agent seat numbers are
expected to witness a compound annual growth rate (CAGR) of 3.0 percent
through 2018” says Baidya. The domestic outsourced seats and captive
contact center seats are expected to witness a marginal increase in numbers
during the forecast period. The number of agents working from home is also
on the rise.

“While Australia addresses the demand for technical support to customers in
New Zealand, other cost-intensive outbound operations are outsourced from
Australian enterprises to the New Zealand market” added Andre Clarke,
Country Manager, Frost & Sullivan New Zealand.

Domestic demand accounts for over 90 percent of contact center seats in New
Zealand currently, and this trend is expected to continue throughout the
forecast period. Telecom continued to be the vertical with the highest
contribution to the contact center outsourcing revenue, followed closely by
Banking and Finance. Retail, Government & Education also has been a
significant contributor as they focus on improving customer service.

The intensifying focus on quality customer service has piqued the interest
of domestic enterprises. “Customer service enhancement continues to receive
priority, as enterprises are investing more capital in contact centers that
offer superior client satisfaction” said Krishna Baidya.

While agent numbers are likely to escalate across the region, the market
will also experience significant attrition. The attrition rates in the Asia
Pacific contact center market will be higher than the rates in other
markets due to high stress levels and career opportunities in other
industries. In 2011, the average attrition rate for the Asia Pacific
contact center market as a whole was approximately 19.1 percent.

Baidya states that one of the main reasons for agents’ lack of stickiness
with the job is that with most organizations attempting to cut costs, the
wages of contact center agents have remained relatively low in the past
three years.

“Many enterprises were investing more on system upgrades rather than in
improving agents’ interpersonal skills and domain knowledge,” noted Baidya.
“Fortunately, this trend is changing as outsourcers recognize the
importance of having well-trained and well-recompensed agents.”

Contact center service segments including consulting, implementation,
management, and agents’ training services have risen in importance for
vendors and system integrators. Consequently, contact center providers in
the region are slowly expanding their offerings to include non-voice,
back-office operations such as knowledge process outsourcing (KPO),
financial and accounting outsourcing (FAO), and human resources outsourcing

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