Running a contact center was once considered a necessary evil. Necessary, because customers expected – and still do – a rapid response when they have questions, problems or issues. Evil, because of the kind of costs and difficulties involved.
Even for a moderate-sized contact center, costs were often astronomical in the days of all premise-based solutions. Just the basic contact center infrastructure would cost companies six or seven figures to set up. After that, they frequently paid tens or even hundreds of thousands of dollars in annual maintenance. The systems were often difficult to work with, unreliable, and poorly integrated with other contact center systems and solutions. This meant companies often had to build their own customer software that could integrate with the existing platform. This patched “Frankenstein” contact center did not scale at all: in the event of widening contact center needs, companies were often out of luck. Organizations could not scale their systems or widen them to cover multiple locations without huge modifications and additional licenses.
With the advent of cloud-based contact centers, companies solved many of their worst problems in a single solution. In addition, companies that could never before afford to run their own contact center found themselves with options. This has contributed to a boom in the cloud contact center market, which has doubled in size in the past three years, according to research from DMG Consulting. In 2010, only 31.8 percent of companies used cloud contact center technology. By 2013, this number soared to 62.4 percent as more companies adopt the model and bring more applications into the cloud.
The popularity of the cloud-based contact center model is proving a boon both for existing solutions providers and new start-ups such as Miami-based Fenero, recently profiled in the Miami Herald. Company CEO Marlon Williams told the Herald that for many companies, software licenses alone could exceed $900,000.
“That’s when I decided the industry needed a change,” Williams told the newspaper. “I thought these guys were nuts to think they could continue charging these exorbitant prices for contact center platforms in 2013. Fenero can provide an equivalent solution, and in specific cases a much better solution, with no licensing fees — ever. Our software is essentially free.”
The company makes money in an interesting way. It generates revenue by having clients pay for the telecom usage that goes through the hosted software solutions. Companies would have to pay for these charges anyway, and with the Fenero solution, it costs companies only a few cents for each interaction handled by an agent. The company, which was founded in 2013, is currently seeking a second round of venture capital funding.
Given the flexibility and the cost savings offered by the cloud-based contact center model, it’s likely we’ll see even more contact centers move to the cloud in 2014, to the benefit of both existing players such as VoIP contact center solutions provider 8X8 Inc. and its virtual contact center solution, and start-ups like Fenero and others. A contact center in the cloud simply offers too any compelling benefits and cost savings for companies to continue to ignore.
Edited by Cassandra Tucker