OVUM VIEW

We attended the annual Turkey Call Center Expo held this month in Istanbul. While we feel that the conference’s overall theme of e-commerce is salient from a strategic operational angle, we are more convinced than ever that this country holds significant value for CRM outsourcers. The Turkish economy is performing strongly, denoting ongoing consumer demand that requires a more sophisticated level of customer service. The extent to which offshore services can be delivered to the European nearshore from Turkey is also becoming clear. As such, the possibilities for Turkey over the long term are significant, and we believe it would be a mistake for global and regional contact center service players to overlook this market opportunity.

Domestic opportunity in Turkey should not be missed by outsourcers

One of the most compelling aspects of the Turkish contact center outsourcing value proposition is the amount of potential business located in its domestic market. Turkey’s CRM professionals feel that the overall market size of the country (approximately 80 million people) is being compounded by a rate of economic growth that cannot be ignored. According to the IMF’s most recent forecast, Turkey is predicted to post GDP growth rates of between 3.5% and 4.5% through 2014. This constitutes an economic expansion well in excess of many Western European locations, and is almost certain to have a positive impact on domestic demand for products and services, in terms of both volume and sophistication. As a result, Turkey-based enterprises will require the services of CRM vendors to manage contact center call volumes and provide high quality service in an ever-competitive marketplace, particularly in light of increasingly discerning Turkish consumers.

A growing nearshore alternative

The delivery of contact center services to the European nearshore was another proposition that emerged during discussions with CRM players. While this idea has been explored by some local players over the past several years, the fact that that global outsourcer Teleperformance has identified Turkey as one of its key emerging European nearshore delivery options indicates that it may be on the cusp of becoming (at the very least) a niche market for European language delivery. In addition, with a notable multilingual hub in Istanbul, we believe that there is potential for CRM outsources to leverage European languages such as English and Dutch from this location.

Contact center outsourcers should seriously consider this market opportunity. Not only does it offer significant domestic value, but nearshore possibilities could also provide outsourcers with diversified revenue streams should they wish to look at multilingual support. With only one global vendor currently operating in Turkey, the early entry possibilities are solid. We acknowledge that CRM players need to conduct due diligence checks into this market in order to determine whether the cost of establishing a Turkish operation is within their capabilities, and to mitigate against geo-political risk (a process that has taken on new scope since the Arab Spring in 2011). In our view, there is compelling evidence that Turkey is a real market for the CRM outsourcing community. As such, it would be a competitive mistake for vendors to ignore its potential.

APPENDIX

Author

Peter Ryan, Practice Leader, IT Services

peter.ryan@ovum.com

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