The call center industry in the Philippines has rapidly burgeoned into a cornerstone of the nation's economy, earning it the title of the "Call Center Capital of the World." With its blend of cost-effectiveness, English proficiency, and a deep-rooted understanding of Western culture, the Philippines stands out as a prime destination for customer support services.
This sector doesn't just represent an outsourcing hub; it symbolizes the tenacity, adaptability, and customer-centric ethos of Filipino workers, making it an attractive destination for businesses worldwide. In this blog post, you'll gain insights into the evolution, strengths, and opportunities of call center culture in the Philippines. Let's get started!
An Overview of the Philippines Call Center Industry
Call centers began in the Philippines as providers of email response, managing customer response, and managing services. This broadened to industrial capabilities for almost all types of customer relations, ranging from travel services, technical support, education, customer care, financial services, online business-to-customer support, and online business-to-business support. Despite some differences between Western and Eastern cultures, Filipino agents continue to maximize profit on behalf of their hired businesses. In fact, businesses worldwide and across industries are taking advantage of business process outsourcing (BPO services) to operate more efficiently without sacrificing quality.
The Philippine government has tagged the call center industry as the “Sunshine Industry” because of its massive expansion for the last 10 years. The majority of call centers are located in first-tier cities of Metro Manila and Cebu City. The country has remained an outsourcing favorite among various nations. One of the main reasons why call centers are so in demand in the Philippines is the low labor costs. More companies in the United States and Europe are coming to the Philippines to take advantage of low-cost yet high-quality call centers and outsourcing services.
The Philippines has become the call center capital of the world. Philippine call centers cater to clients from the US, Australia, and the United Kingdom. Being the third largest English-speaking country in the world, with a high literacy rate, the Philippines is considered one of the most competitive call center destinations in the world. Call centers continue to grow and surpass employment targets every year because of the high demand for offshore business in any part of the world.
What Is a Call Center?
As you can tell, the Philippine call center industry is robust and offers many positives as a call center outsourcing company, but call centers exist everywhere. If you're not familiar with a call center, it is a physical location where an organization handles a high volume of customers and other telephone calls on behalf of another company. Here are some examples of how call center industry business process outsourcing can help your business:
- Answering inquiries from customers;
- Providing technical support and customer care;
- Market research;
Business process outsourcing such as finding a call center to assist with this aspect of business operations is only becoming more popular with time. Usually, call centers provide voice-only inbound, outbound, and self-service customer interactions. Companies throughout the world are taking advantage of the growing call center industry.
There are different types of call centers that offer varying services depending on the unique needs of your organization. Common types of customer call centers include:
- Inbound call center
- Outbound call center
- Customer service center (contact center)
- Multichannel call centers
- Virtual call centers
- Automated call centers
- Blended call center
The call center industry uses numerous metrics to evaluate the effectiveness of a company and the productivity of its personnel. A successful call center is based on how the workers handle their calls and how the agents work as a team either in an inbound or outbound setting, or a contact center.
Speaking of contact centers, let's explore how contact center services differ from call centers.
Call Center vs. Contact Center
It's important to determine the type of communications technology support that your company needs before making an investment. The main difference between a call center and a contact center is the channel that each one uses. Generally speaking, traditional call centers as we know them rely on legacy phone systems while contact centers instead leverage various digital channels that customers use today to stay in touch with businesses. For example, call center employees take on different tasks compared to contact center employees. A call center agent might rely on a legacy phone system while those working in a contact center might instead take a more omnichannel approach, interacting with customers on platforms such as apps, email, text, phone, messaging, web, and social media.
Today's customers expect top-notch service from the brands with which they interact across platforms and mediums. They expect to interact with brands in a similar way that they do with their friends, often using mobile devices. However, in the case that the majority of your customers interact with your brand over the phone, it might be more beneficial to opt for call center outsourced services to break down communication barriers with your target audience.
You might be wondering if contact centers are just call centers that have more channels. In the past, inbound call centers were designed to help serve a large volume of customers as quickly as possible through voice calls. On the other hand, contact centers are designed to understand what customers want quickly, giving them a timely response from the channel of their choosing. Despite the additional channels, there are more differences between the two. Contact centers act as the central point for customer contact management, and this requires coordinating and the integration of people, technology, and processes across the business.
Why Companies Outsource Their Services
Companies, regardless of the industry, are constantly seeking solutions that will improve the efficiency of their operations which often means making sure customers are taken care of. With only so much time and resources available, many business owners are expanding outside of their in-house teams and instead investing in diverse employment opportunities for part-time employees.
Here are only some of the services that companies are outsourcing:
- Customer service
- Administrative tasks
- Marketing efforts
- IT management
- Bookkeeping and accounting
- Shipping and logistics
If you're looking into finding your first call center for outsourcing purposes, there are many benefits that you can expect. We've outlined only a few of them below.
Hit KPIs and Improve Operational Efficiency
Filipino call centers can help you hit your predetermined KPIs. For example, the right team can minimize hold times for your customers and help them have a more positive experience with your company. The lower the hold time, the more likely your customers will be satisfied. Outsourcing companies can also help improve first-call resolution, meaning we can help resolve the inquiry or problem of your customer during the first time that they call instead of having them call back in the future. The more effectively you can get through your call volume, the better your customer experience and the easier you can hit your KPIs.
Increase Productivity & Reduce Costs
You only have so many resources to spread throughout your business yet you need to continue to keep productivity as high as possible. If your in-house staff is constantly trying to keep up with customer inquiries, they won't be able to focus on expanding the business in other ways. Call center technology is designed to get through a large volume of inquiries in a short amount of time, helping to increase your overall productivity. Any repetitive and manual tasks that your team has been taking on can be passed to the call center staff. Customer service costs will also lessen as more processes are automated and improved.
Focus on Core Business Aspects
The business process outsourcing industry continues to grow, allowing more and more companies to have more time to spend on other areas of the business. For example, maybe you need to focus on building out a better sales process or you need to put more time into creating a pleasant onboarding experience. The Philippine PBO industry can significantly reduce the stress on your plate and free up time.
What Does a Philippines Call Center Agent Do?
Call center agent in the Philippines undergoes rigorous training to become proficient in their designated field. The training modules are meticulously designed to ensure agents acquire expertise across a spectrum of services, irrespective of their initial knowledge. Emphasis is laid on communication skills, product knowledge, problem-solving, and cultural sensitivity, especially catering to Western clients. Once trained, agents can specialize in various tasks based on their skills and the company's requirements.
Here are some of the roles they often perform:
- Phone Answering: Handling customer queries and concerns.
- Appointment Setting: Managing and confirming schedules.
- Data Entry: Inputting information accurately.
- Chat & Email Support: Addressing issues in real-time.
- Order Processing: Managing customer orders.
- Content Moderation: Ensuring content meets guidelines.
- Data Processing: Streamlining business data.
The versatility of tasks performed by these agents makes them invaluable assets to businesses globally.
What Types of Companies Outsource?
The trend of outsourcing is becoming increasingly prevalent across a myriad of business sectors worldwide. Many companies, whether they are established giants or emerging startups, are recognizing the benefits of leveraging external expertise for a variety of services. This move not only optimizes costs but also allows these firms to focus on their core competencies. For instance, prominent Australian corporations such as Jetstar, Optus, and Telstra have turned to the Philippines for their outsourcing needs. Similarly, in the United States, industry leaders like Aetna, Citibank, Safeway, and Chevron have embraced this trend. Here’s a breakdown of industries that commonly outsource:
- Insurance companies: To manage claims, customer support, and data processing.
- Real estate sector: For property management, customer relations, and digital marketing.
- Retail & e-commerce: Handling customer service, inventory management, and online order processing.
- Small businesses: Often outsource tasks like bookkeeping, marketing, or it support to specialists.
- IT companies: Regularly contract out software development, system maintenance, and technical support.
- Other industries: From healthcare to manufacturing, various sectors utilize outsourcing to enhance efficiency and productivity.
Why Is the Philippines Becoming the Outsourcing Capital of the World?
As far as BPO outsourcing destinations are concerned, the Philippines is one of the fastest-growing countries in the world. Here are some frequently outsourced services in the Philippines:
- Customer service
- Administrative tasks
- IT management
Today, the Philippine BPO industry is considered to be the call center industry's crown jewel of success, and it has employed over 1.7 million people with various skill sets. The total revenue is close to $23 billion in this industry and the current growth rate is 16%, meaning that the call center industry is a large contributor to the overall economic growth. Here are some of the main reasons why the Philippines has become the BPO capital.
Impressive Literacy Rate
With over 450,000 graduates annually and a 95% literacy rate, citizens in the Philippines are highly educated and qualified to provide these services. Access to a large employment pool also means more specialization across industries.
The labor costs in the Philippines are low compared with those in the U.S. The cost-to-skill ratio is also ideal for most companies and the performance of these outsourced call centers speaks for itself.
Call center outsourcing is a much smoother process when your customers don't notice any difference in their experience. It might seem small, but another significant positive to Philippine call centers is that the people have neutral accents. This means they're able to speak with your customers in a natural and familiar manner.
Brief Call Center History in the Philippines
The Philippine Business Process Outsourcing (BPO) industry has experienced a remarkable transformation since its inception. Beginning in 1992 with Frank Holz's establishment of the first contact center, the industry quickly garnered the attention of the national congress. By 1995, the Special Economic Zone Act was passed, and the Philippine Economic Zone Authority (PEZA) was formed, both pivotal in attracting foreign investment. By the early 2000s, the BPO sector modestly contributed 0.075% to the nation's GDP. However, with advocates like Mar Roxas and the establishment of the Contact Center Association of the Philippines (CCAP) in 2001, its trajectory soared. By 2013, the industry employed 900,000 full-time professionals, reflecting its meteoric rise. Now, as a global BPO leader, the Philippines continues to thrive in this sector.
Call Center Statistics in the Philippines
To get a better idea of the significance of this industry in the Philippines, here are some noteworthy statistics:
- In 2021, the sector earned $29.49 billion;
- There is an annual compound growth rate of 9.2% from 2016 to 2022 and it will hit $38.9 billion as of this year (2022);
- By 2028, there will be roughly 2.5 million people working in outsourcing;
- As of 2022, approximately 15% of the world's global outsourcing market is served by Philippine outsourcing services.
As you can see, the growth in this market is outstanding.
What Companies Outsource Their Services?
Companies around the world and across industries are relying on outsourced services more and more. For example, there are massive Australian-based companies including Jetstar, Optus, and Telstra that rely on the Philippines for outsourced services. Some examples of American corporations include Aetna, Citibank, Safeway, and Chevron.
If you've been contemplating whether or not to take advantage of outsourced services for your company, now is the time to make the investment! At Hit Rate Solutions, we are a highly regarded call center based in the Philippines and we are happy to help with an array of services for your business. If you're interested in learning more about how we can assist your business, please get in touch with us today!