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Argentinean and Chilean Contact Center Outsourcing Markets Experience Growth

By Madhubanti Rudra, TMCnet Contributor

Argentina and Chile’s contact center outsourcing services markets experienced a huge growth during 2010 and 2011. But the story was different in 2012, when the global economic slowdown resulted in the shrinking of offshore revenue. Though there was a drop in the offshore revenues, the contact center industries in both the markets witnessed a spurt in domestic revenues.

A recent Frost & Sullivan report reveals that the domestic markets in both the countries surged to a considerable extent. While the Argentinean contact center outsourcing market earned approximately $906.5 million in 2012, Chile managed to amass revenue as big as $363.2 million during the same period.

A new report entitled, “Analysis of the Argentinean and Chilean Contact Center Outsourcing Services Market” in fact predicts that Argentina’s domestic call center market is poised for further growth and likely to reach $1.87 billion in 2019. This growth will ride on the country’s success in the telecommunications vertical, the report explained.

Last year, Chile lost considerable contact center outsourcing orders to its neighboring competitors including Peru and Colombia. The country’s domestic contact center market is likely to reach $628.8 million in 2019, recording 84 percent growth. Both local and multinational companies will benefit from this huge growth momentum, the report mentioned.

The report also predicts that both Chile and Argentina will continue to dominate the region’s contact center outsourcing market in the upcoming years, offering significant contact center outsourcing services to other Latin American countries.

Overall, the offshoring shares of Latin America are expected to increase to 50.7 percent in Argentina and 6.6 percent in Chile by 2019.

When you have a skilled workforce and a well developed infrastructure, it becomes easy to diversify business and capture new markets.  The contact center industries in both the countries seemed to have accomplished just that. The industry in both the countries took a paradigm shift from being a commodity service provider to the supplier of more sophisticated contact center service packages that come complete with communications and marketing, IT and financial services. This helped the contact centers in these two countries to adapt themselves to more competitive business environments.

 “Both countries have talented, experienced contact center personnel and strong infrastructure, so it is reasonable to expect that the markets will diversify into more specialized services to create more value per contact. Some of these specialized services include software support, financial banking consulting, and health/medical virtual diagnosis,” Frost & Sullivan (News - Alert) ICT Research Analyst Martin Ramirez said in a statement.

Spain has been a major source of business for both Chile and Argentina. In order to cope with the thinning out of Spanish deals, contact centers in both the countries are going to shift their focus in the Latin American markets. With an eye on Portuguese-speaking markets, Argentina’s contact center industry is likely make investments for developing Portuguese speaking resources. However, Spain is the biggest consumer of the Chilean market's offshore services. Though there will definitely be a sharp decrease in the demand of these services, Spain will continue to dominate the Chile's offshore revenues in 2019, Frost & Sullivan predicted.

“Revenues from the telecommunications vertical are likely to decrease in the next two to three years due to the slowing down of Spanish mobile telephony as well as Chile's market saturation and Argentina's unmet portability expectations. This will drive the contact center market to more promising industries such as healthcare, retail, government and education,”   Ramirez added.

Based on its analysis of the retail carrier Ethernet services market, Frost & Sullivan recognized tw telecom (News - Alert) with the 2011 North American Frost & Sullivan Award for Growth Leadership. Each year, this award is presented to the company that demonstrates excellence in capturing the highest compound annual growth rate (CAGR) for the last three years. tw telecom's Ethernet services revenue grew at a CAGR of 28 percent from 2008 to 2010, which is commendable considering the relatively weak economic situation during that period.

New analysis from Frost & Sullivan's, Update on the CRM BPO and Contact Center Outsourcing Services Market in Brazil, finds that the market earned revenues of more than $5.42 billion in 2011 and estimates this to reach $16.21 billion in 2018.