1. January 27, 2015
Global Trends in the Contact Center Market
and Opportunities for the Philippines

2. Proprietary & Confidential. © 2015, Everest Global, Inc. 2
Global contact center market – key highlights
Global spend on contact center services is US$300-350 billion
20% of the global spend on contact center is currently outsourced;
Global CCO market is US$75-80 billion
Global CCO market expected to grow at 6-8% in the next 3-5 years;
offshore CCO market expected to grow faster (10-12%)
Philippines is the leader in the offshore/nearshore English CCO
market with ~36% market share

3. Proprietary & Confidential. © 2015, Everest Global, Inc. 3
There are four disruptive forces that will shape the
contact center market over the next few years
X
X
X
X
1. CCO enabler
technology
4. Contact center-
as-a-service
2. Multi-channel
solutions
3. Changing
CCO solution
characteristics

4. Proprietary & Confidential. © 2015, Everest Global, Inc. 4
Enabler technology is increasingly becoming a
strategic imperative for CCO
40
CRM
technology
Communication
technology
Enabler
technology
62
25%
11%
40%
21%
35%
68%
Up to 2010 2011-2013
CCO technology investment by category
Share of investments by service providers
Sample: Based on 102 technology investments made by 24 service providers
Source: Everest Group (2015)
Key areas of investments in enabler
technologies
Analytics Social media
Workflow
management
1
100% =

5. Proprietary & Confidential. © 2015, Everest Global, Inc. 5
Shift in channel mix towards non-voice
channels is likely to intensify
89%
84%
7%
9%
3%
4%
1% 3%
2011 2013
CCO revenue across channels over time
2011-2013; US$ billion
14-15100% = 16-17
Voice
E-mail
Chat
Social
media
4-6%
25-30%
35-40%
80-90%
Growth
rate
Source: Everest Group (2015)
Non-voice
Single channel
Two channels
More than
two channels
Adoption of multi-channel CCO contracts
Number of contracts
409 626100% =
48%
36%
34%
37%
18%
27%
Till 2011 2013
2

6. Proprietary & Confidential. © 2015, Everest Global, Inc. 6
Buyers will increasingly seek value-driven
solutions from their CCO providers
Traditional
Value
proposition Emerging
Labor
arbitrage
50-60% 30-40%
Process
improvement
5-10% 15-20%
Business
outcome
<5% 15-20%
Cost savings through CCO
Changing solution characteristics
 Focus on quality rather than cost
containment
 Adoption of a balanced onshore-
nearshore-offshore model
Delivery model
 Focus on multi-channel solutions
 Shift from CRM to communication and
enabler technologies
Channel mix
 Focus on advanced learning techniques
(e.g., scenario based)
Technology
Agent training
 Deal scope expanding to include value-
add processes
 Growing focus on industry-specific
capabilities
Value add
 Non-linear, mutually beneficial pricing
structures
Industry
specificity
Pricing models
Source: Everest Group (2015)
3

7. Proprietary & Confidential. © 2015, Everest Global, Inc. 7
Contact Center-as-a-Service (CCaaS) will challenge
traditional CCO value levers, requiring CCO providers
to rethink their differentiators
Source: Everest Group (2015)
Key benefits
of CCaaS
 Cost effective and lower capital expenses
 Rapid deployment and easy integration
 Scalable solutions
 Personalized and localized customer services
Cloud-hosted contact center solution Implications for CCO industry
Tech strategy must evolve
Need clear BPO value prop
Sustaining price points
Core technology now available at
lower costs. CCO providers must
hone in on tech capabilities that
create new value
Clients may migrate towards a
technology-driven solution if they
do not see a clear value
proposition from CC BPO model
CCaaS will put further pressure
on margins. CCO providers must
evolve their offerings to target not
only savings but business
outcomes as well
4
Contact Center-as-a-Service
Automatic Call
Distribution (ACD)
Interactive voice
response (IVR) Real-time
analytics
Quality
management
Reporting
Unified
communications
CRM integration
Multi-channel
solutions

8. Proprietary & Confidential. © 2015, Everest Global, Inc. 8
Philippines continues to maintain its leadership
position for English contact center work
Low
High
Low
Operatingcost
HighAvailability of talent
Note: Everest Group's Maturity, Arbitrage, Potential Matrix. Based on fully-loaded, ongoing operating cost, talent pool, and risk assessment
Note: Based on representative cities in a country; there could be other cities in the country that also offer comparable propositions
Source: Everest Group (2015)
Everest Group MAP Matrix™ for English contact center
2014
Favorable, but some concerns
Significant challenge
Highly favorable
Risk profile
LeadersAspirants
Major Contenders
India tier-1
Philippines tier-1
Philippines tier-2
India tier-2
CairoGuatemala City
Cape Town Buenos Aires
Monterrey
San Jose
Panama City
Santiago
Glasgow
Belfast
Dublin
Montevideo
Bogota
San Salvador
Montego Bay

9. Proprietary & Confidential. © 2015, Everest Global, Inc. 9
The global locations landscape continues to evolve rapidly
with more “viable” alternatives to mature locations
Source: Everest Group (2015)
Philippines
India
China
Malaysia
South Africa
Argentina
Chile
Mexico
Costa Rica
El Salvador
Morocco
Egypt
Bulgaria
Romania
Poland
Czech Republic
Hungary
Sri Lanka
Slovakia
Colombia
Guatemala
Honduras
Nicaragua
Emerging locations
Mature locations
Nascent locations
Uruguay
Mauritius
Brazil

10. Proprietary & Confidential. © 2015, Everest Global, Inc. 10
Push towards a balanced onshore-offshore delivery model
likely to pose some challenges to CCO offshore locations
Distribution of CCO contracts with offshore/nearshore
components
Number of contracts
Predominantly
offshore delivery2
Significant
onshore delivery1
100% = 409 406
1 Contracts with more than 25% of FTEs located in onshore locations
2 Contracts with more than 75% of FTEs located in offshore/nearshore locations
Sample size: 1,035 CCO contracts signed between January 2008 and December 2013
Source: Everest Group (2014)
Onshore leverage in CCO
Percentage of onshore FTEs
16%
29%
37%
2008-2010 2011-2012 2013
220
65%
51%
42%
35%
49%
58%
2008-2010 2011-12 2013

11. Proprietary & Confidential. © 2015, Everest Global, Inc. 11
While the opportunities are significant, Philippines needs
to address some challenges to ensure sustained growth
Philippines
contact
center
industry
Leverage points for the
Philippines
Potential risks to manage
 Global hub for English
language contact center and
strong leadership position
 Niche play beyond voice in
voice-adjacent segments
 Access to multi-lingual skills in
the region and competitive
cost position
 Strong foundation in multi-
channel delivery
 Potential in tier-2/3 cities
 Push towards balanced
onshore-offshore delivery
 Evolving buyer needs in terms
of automation
 Currency attractiveness vs.
other countries
 Attrition and wage inflation
 Geographical concentration
risk and its impact on business
continuity

12. Proprietary & Confidential. © 2015, Everest Global, Inc. 12
Issues to consider for the Philippines contact
center industry
Talent development
 Balance need for generic skills (e.g., communication) versus specialized skills (e.g., care
management, social media) to meet demand from existing and emerging segments
 Invest in career-pathing, alternate talent, and retention to increase talent availability
Moving up the value-chain
 Articulate "moving up the value-chain" in context of Philippines and reorient value positioning
for new offerings (e.g., multi-channel, analytics)
 Balance objectives of growth driven by scale and higher value
Ecosystem development
 Accelerate development of tier-2 locations; closely monitor potential saturation challenges in
tier-2 locations
 Sustain industry initiatives to control costs and substantiate value beyond arbitrage

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