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Brazil is considered a unique market in the contact center space. This large Portuguese-speaking country has its own technology-related history; telephone access is still seen as a luxury here, whereas most countries have already commoditized contact lines much earlier. Despite the limitations, the contact center market in Brazil is being pushed to a global stage given its large size in terms of workforce strength and the number of companies in this space. Just the outsourced operations of contact centers, which accounts for one-third of all available positions, employs more than 1 million people in a wide range of companies.
The contact center services market in Brazil is primarily dominated by local players. A few global service providers, mostly from Europe, are disrupting the local market. Some global companies run local operations to serve their global clients. However, the impact of withholding taxes, along with the economic downturn, seem to make the region a less favorable destination for global and U.S.-based players.
At the same time, digital transformation, digitalization of channels and a focus on customer experience are growing trends and preferred investment areas. As a result, modern technologies such as intelligent interactive voice response (IVR) systems, voice and chatbots are increasingly adopted in these areas. Artificial intelligence (AI) and machine learning (ML) applications are being implemented in larger use cases. However, there remains a shortage of trained and experienced resources in data science, statistics and AI-programming, which, including the relative high cost of technology, hinders the speed of adoption. Brazil is witnessing an increase in the usage of deployed channels such as chat and email. Millennials generally lead the adoption of digital channels, including social media. Voice remains the most popular channel, primarily attributed to the high number of the cellphones (more than 230 million active lines), but is losing out to the text channel. WhatsApp has gained immense traction after voice and is being considered a complete omnichannel solution. The integration with this communication channel can now be executed by an official API and end most of the unsupported workarounds. Voice messaging is also increasingly delivered through WhatsApp. SMS messaging, based on relatively high costs, never have been really a very strong channel, even though the base of SMS has grown over a couple of years, and it is now deployed often for special purposes, like two level security features, satisfaction surveys or collection and recovery use cases.
Contact centers cover a broad range of services ranging from customer service, sales, research, support, tracking, loyalty and retention to collections and other high-value transactions. At the same time, the services are often not well perceived by customers due to their frequent misuse. This often involves making unsolicited sales, involving innumerous contact attempts from predictive dialer systems, which are insistent even when the wrong contact is detected, as well as the historical use of services to build a bulwark to separate the contracting company from its customers.
This perception is gradually changing. Customers are expecting homogeneous treatment, irrespective of the channel or whether it is outsourced. Today, poor brand reputation is easily echoed through social media channels and the dominant millennial population does not hesitate to cancel contracts over a low-quality customer experience.
LGPD, the Brazilian privacy control act that is equivalent to European GDPR, is increasingly gaining prominence and will soon be put into effect. This will have a considerable impact on contact center operations put a wide range of common services and practices into risk.
Customers are increasingly demanding better privacy laws, clustering and segmentation, a more customer-centric approach, leveraging omnichannel technologies and asynchronous communications techniques, as well as digital personalization. To ensure an effective and successful transformation, whole chains of processes must be redesigned, systems should be integrated, scripts to be adapted, KPIs must be reassessed, and agents should be effectively trained to resolve problems.
The design and implementation of these requirements require consultancy services such as design thinking, change management and high levels of specialized technology consulting. Objectives such as personalization in massified operations can only be achieved through heavy deployment of automation and analytics powered by AI and ML.
In a highly emphatic and people-oriented environment such as the one in Brazil, the human touch remains an important factor for the success of business operations. Investment should thus be directed toward training and empowering human agents with behavioral tactics. Operation should be structured in such a way that humans and machines work together seamlessly.
The concentration of service providers is equally observed in Brazil as in other regions. This could be attributed to the economic downturn in the country, leading to increased costs of technology, mainly when bought from abroad. This has in turn resulted in bigger operations being diluted by a larger client base. Despite this, more leading players are establishing spin-off companies or units to accelerate digital transformation and client experience related-consulting services in this space.
After years of an economic downturn, there were expectations of growth in 2020. However, the COVID-19 pandemic and the correlated lower economic activity in many sectors is estimated to lead to reduced revenues of around 20 percent in the contact center space. Additional pressure can rise from from the revocation of relief from labor-burden taxes still under discussion at the moment, and it may accelerate the substitution of humans by technologies.
In general, the response to COVID-19 has been positive in the region. Most players have been able to put 60 to 90 percent of their workforce in the home office model in a matter of weeks, sometimes in just days. This requires unconventional measures such as acquiring more computer systems and installing links for the remote working environment as per requirements.
The current pandemic has accelerated digital transformation to a considerable extent and new cloud-based technologies, sometimes deployed in a pilot/project environment, should be managed and cope with the immediate shift to heavy, industrial-size workloads. Given the benefits such as higher productivity and reduced need to commute, more companies are keeping large parts of their operations permanently in the home-office model. However, to be sustainable, programs should be developed on how to maintain company culture, address employee retention, assess the impact of labor laws and create psychological assistance to prevent employee fatigue and other negative long-term effects.
The current contact center-as-a-service (CCaaS) offerings have now become widely accepted in the market. Technical infrastructure has improved substantially and concerns about latency, quality, security and scale are diminishing. On-premises installations will be substituted as per new investment cycles around CCaaS and cloud technology. On the other hand, self-provisioning and serving models are still facing issues due to high integration with session initiation protocol (SIP) trunks, public switched telephone networks (PSTN), and payment methods involving credit cards.
In conclusion, through contact center and customer experience offerings in Brazil are replicating and adapting to various market trends, the market demonstrates uniqueness with its own set of players, strategies, scenarios and challenges.
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