Philippines CRM outsourcing market still attractive

ovumThe Philippines continues to be one of the most attractive destinations for outsourcing, fuelled largely by competitive price points and significant pools of labour with English language skills, according to Ovum.

New research focused on CRM suppliers in the Philippines found potential within the industry as a non-voice and non-English-speaking delivery center. Furthermore, as the country’s economy continues to expand, outsourcers will see greater opportunities to serve the increasingly sophisticated domestic market.

“Following our visit to the country and our on-the-ground research, it is clear to us that the Philippines will remain one of the powerhouses among offshore front-office outsourcing destinations,” said Margaret Goldberg, Associate Analyst, IT Services at Ovum and co-author of the report. “The combination of a significant cultural disposition towards customer service and affinity to Western cultures, strong English language capabilities and competitive price points will ensure that the outsourcing industry in the country will continue to see strong growth for years to come.”

The outsourced contact center market in the Philippines is among the most robust in the world. “Specifically, we anticipate an increase from just over 117,000 agent positions (APs) to nearly 173,000 APs by the end of 2017. We also anticipate annual growth in agent positions will be roughly 10 percent through this period, which is significantly higher than the global growth of approximately 5 percent year-on-year during this period,” comments Goldberg.

The report also reveals that the largest vertical markets serviced by contact center outsourcers in the Philippines are financial services and communications, a trend anticipated to continue for the next five years. Smaller vertical markets are forecast to have marginal increases in APs dedicated to sectors such as retail and travel & tourism, which are driven by growth in consumer spending as Western economies improve. Healthcare will also see growth, notably from transactional work from the US as “Obama-care” is implemented.

“From an outsourced contact center perspective, the Philippines is heavily weighted toward offshore delivery. approximately 10 percent of outsourced capacity is currently devoted to domestic work. This is not anticipated to shift significantly over the next five years. However, should the Philippines consumer space experience growth in volumes and sophistication, these proportions could change markedly, and outsourcers need to watch this space closely to prepare for such an eventuality,” concluded Goldberg.