As Hispanic-American consumers become more affluent, they represent a rapidly expanding sector of the business-to-consumer market. American businesses are starting to realize that if they want to reap sales from this increasingly valuable market segment, they need to offer marketing and customer service in both Spanish and English, in whatever combination the customer prefers. And they need to start doing it now.
Call centers that offer support for Spanish are growing by leaps and bounds. Outsourcing to countries with high quality, Spanish-speaking workforces is also on the rise. In terms of U.S. outsourcing, this may put a crimp in the popularity of India as a customer service outsourcing destination, as India does not generally offer European languages other than English, though it may prove a boon to the Philippines, which, as a former Spanish colony, frequently offers Spanish language support.
South and Central American and the Caribbean are also poised to benefit from the increasing need of Spanish-language support.
Once touted as “the little economy that could,” the Dominican Republic’s decision to bet on the high-tech service sector has begun to pay off. By the close of 2006, the Dominican contact center industry boasted more than 40 centers employing more than 18,000 people, gaining the country a growing reputation as an extremely viable destination for business process outsourcing (BPO).
The blossoming of call centers in the country has indeed attracted industry attention as the Dominican Republic focuses on high-tech services more sharply. According to the Zagada Institute, a business development analytics firm, the Dominican Republic is the leading call center location in the Caribbean and Central America, followed by Jamaica, which employs roughly 10,000 agents throughout 16 centers, Panama with 9,500 agents, Costa Rica with 4,500 and El Salvador with 4,000.
Eddy Martinez, executive director of the Dominican Republic’s Center for Investment and Exports (CEI-DR for its Spanish acronym), expects the number of BPO agents to grow to 30,000 by the end of 2007.
“We are bullish on the BPO industry because we have seen the explosive demand for Spanish-language back-office, telemarketing and customer support services,” said Martinez. “We are now starting to reap the benefits of our investments in training and technology, and our positioning as the Spanish-language partner to countries such as India, who are global BPO industry leaders.”
(Note: India, aware of its lack of European language services, in many cases chooses to partner/sub-contract with other countries for support in the languages Indian agents lack.)
There are several other contributing factors to the Dominican Republic’s emergence as a call center/BPO destination. Among them is the country’s convenient proximity to the U.S. mainland, which makes it attractive to U.S.-based companies that want their offshore operations to be “nearshore.” The Dominican Republic is located less than 850 miles from Miami, or about a two-hour flight. Additionally, the country’s cultural affinity with the U.S. makes it easier to find skilled bilingual agents at a time when the labor pool is tight.
This was a key factor for Stream, a global contact center services provider, when the decision was made to expand its contact center operations in the Dominican Republic.
“A lot of our clients like to jump on a plane and come and see the center and see the people who are handling their business,” said Toni Portmann, CEO
Additionally, operating costs are much lower then those of other destinations, such as India, Chile, Puerto Rico or Mexico. It’s easier to find skilled bilingual agents, at a reasonable rate, as competitive wages in the Dominican Republic can be as much as 70 percent lower than the cost for a bilingual worker in the U.S. According to the Boyd Company, an independent location consulting company, costs to operate call centers in the Dominican Republic are the lowest among Caribbean locations.
While industry experts agree that India and China have led the charge in the development of the BPO industry, a geographical competitive shift has already begun to take shape. A.T. Kearney, an industry standard in rating BPO competitiveness, has already stated that for its 2007 report, it will include 15 new countries, among them the Dominican Republic, Tunisia, Ghana and Uruguay.
According to Martinez, the Dominican Republic has everything in place to capture a larger share of this growing market, which last year raked
in approximately US $6.3 billion for India alone.
“We’re prepared for the challenges ahead,” said Martinez. “And because of that preparedness, we’re ready to take our game to the next level.”