Everest Group have been in the industry since 1991 and are a specialist research firm producing c. 2,500 reports per year, these include their assessment of the state of the Customer Experience Management (CXM) market.
Through this latest report they estimate the CXM market to be in the region of between $112 and $114 billion of revenues in 2023 for work connected to customers looking for support assisted through digital or human channels. There is an expectation that revenues will, however, be flat through 2025.
However, this accounts for only one third of the market which if taking in-house operations into account would be c. $330 billion, which presents a continued opportunity for the outsource community.
Other highlights include views around channel adoption and predictions of the death of voice are still not coming to pass, when considering include both agent supported voice and conversational AI driven interactions then, 72% of revenues were still coming from voice-based activity in 2023.
The average number of FTE has reduced by 15% since 2018/19 in the 2022/23 report. We know this has been driven by automation, elimination activities, improvements in efficiency, deployment of technologies especially around agent assist. The impact of generative AI has clear contributed to the ability of agents to be more efficient and reduce AHT. However, a survey of over 200 enterprises showed that 20.6% expected no impact to headcount, the majority (37.3%) expected a moderate impact of 5 to 15% and the smallest proportion of respondents (14.3%) expected a significant impact of greater than 15%.
What are clients or prospects looking for?
What insights can we gather from the session that can be applied in our conversations?
- There is still a strong demand for voice
- Deal cycles are longer than they used to be (as we’ve heard in many discussions)
- Increased adoption of GenAI is happening
- There is a desire to develop strategic partnerships, with longer relationships to enable access to better solutions
- Cost optimisation including movement to offshore locations to balance costs remains a focus,
However, when it comes to locations the list of new ones for global English support is growing. More attention is being paid outside the traditional locations and people are talking more about sub-Saharan Africa. Whilst limited numbers have been signed so far, there is a clear interest here. This could be in part be due to people being keen to understand what talent will be needed in 3 years and what skills those people need should also be a consideration as potential clients are now asking these questions.
Priorities for businesses working with service providers still include looking for smart optimisation, operational efficiencies and the collation of insights and data that can inform decision making in the business.
There is a continued focus on the development of agent experience, driving staff satisfaction and making agent roles easier through the use of technology and GenAI to ensure that talent is retained within business, to the ultimate benefit of customer experience, of course.
What businesses want to know is how you can solve a specific problem or challenge. They are now less inclined to say “this is my volume can you staff to that” and more likely to say “this is the problem, how can we create better outcomes together?”.
Customer experience remains critical and there is a movement from delivering an OK experience at the lowest cost, to instead now looking at the end-to-end experience from marketing through the customer lifecycle and then back into the next phase of marketing.
The impact of technology?
As with all changes, consideration needs to be made as to what is appropriate for the needs of your customer. For example, the use of voice in sales environments means that there 82% of activity is still voice led, whereas in Tech support this falls to 61%.
Technology will be beneficial when used in the right contexts, modernisation of existing solutions, the ability to collate data to make decisions around both customer and employee experience, but it needs to be an enabler not just an offering. We need to be clear as to what problem you are using it to solve.
Some clients will forge strategic partnerships with suppliers bringing the right technology and people to solve an issue. Using an outsource provider can bridge the gap from the migration to emerging technologies as outsource partners have people with the skills, knowledge and experience to support that change and can flex staffing requirements as necessary.
Decision making, however, will take longer as a result of the impact of technology change across the wider organisation. Changing experiences using systems and using better data to bring a consolidated view and benefits across the wider organisation means that there will be more stakeholders in the decision making process and therefore it may take longer to make those changes – which could then contribute to the feeling that deals need to be longer in duration to ensure benefits have time to be realised
“Clients don’t want people just running around hitting things with a technology stick, they need to ensure that they consider the benefits”
Sector specific outlook
Healthcare has grown quickly last year and it appears it will continue to do so, Retail has again grown well this year and is forecast to grow faster in 2025, travel and hospitality whilst flat this year is expected to grow faster next year as the sector starts to look more at connected experiences using generative AI.
There is expected to be some reduction in headcounts in the Telco and Media space as providers look to squeeze costs and use technology to deliver savings.
Of course, the willingness of customers to engage with AI differs by sector. Healthcare and travel and hospitality have been among the slower adopters. As technology has moved faster, BFSI and Retail are embracing these changes too, with a focus on use cases to improve experiences and end to end solutions. Agent assist, post call automation and agent training are all areas where AI solutions are moving into production. Less progress has been made on knowledge management and least of all on the use of sentiment analysis.
Most progress has been made with transitioning to production, where there is a direct impact to the customer. The focus so far in the past 12 months has been to deploy Gen AI into “safe” internal use cases, initially.
Evolving expectations
Clients expect more than ever before from outsource providers. In terms of the top 5 capabilities / requirements, some themes are consistent with those that have always existed, however in some cases there may be more openness or need for support, especially when using new and evolving technologies.
- Uplifting quality
- Elevating customer experience
- Implementing new tools and technologies
- Productivity
- Ability to introduce new ideas
AI skilled agents who are supported by automation allowing them to be more efficient and effective and deliver better experiences as a result, is becoming a standard expectation. Future capabilities will include near real time voice-to-voice translation with minimal lag. The opportunities that this may present need to be considered, but this could support many clients, as a result there needs to be careful consideration.
If you wish to chat about or need support in any of the areas discussed then feel free to contact us.
