A Look at Contact Center Technology and Costs

A Look at Contact Center Technology and Costs

There are no shortages of application options — and, with them, technology costs — in the contact center. But the key focus for any spending should be to improve the customer experience.There are a variety of contact center technology options, including contact center software, customer relationship management systems, speech analytics, workforce management software, knowledge management systems and AI-enabled virtual assistants. Decision-makers must ask which technologies will provide the biggest return on investment when it comes to improved business metrics, including higher customer ratings.

Before determining what the must-have applications are for customer service and customer support staff, businesses must determine what they’re trying to achieve in their call centers. Some questions that leaders should ask are the following:

  • Are we trying to sell products and increase revenue?
  • Are we trying to quickly solve customer problems and improve customer satisfaction scores?
  • Do we want to divert simple questions from a phone call to self-service applications or chatbots to reduce operational costs?

Armed with answers to these answers, CX leaders can evaluate contact center platform options and what’s included in a base license. Then, they can determine what additional applications are necessary to meet the business goals.

Contact center costs

On average, companies spend $3,899 per year, per license on all contact center technology that agents use plus the staff to support it, according to Nemertes’ Cost-Benefit Analysis: Workplace Collaboration and Contact Center research study. The costs vary widely based on the size of the organization. Overall, per-agent contact center costs range from $2,891 for companies with more than 500 agents to $4,303 for those with less than 100.

As the size of the contact center gets larger, companies benefit from economies of scale, primarily in the area of the IT staff. It’s must less costly per agent to support a contact center with 500 or more agents — $829 per license per year — than it is to support those with 100 or fewer licenses — $2,423 per license, per year. The number of full-time equivalent IT employees per business ranges from 2.4 to 24.3, based on the size of the contact center.

Unlike technical support costs, contact center technology spending increases per agent as the size of the contact center grows. Smaller contact centers spend $1,880 per agent, per year on the technology, compared to $2,063 for larger contact centers. Larger contact centers tend to bundle more in with their contact center platform on enabling applications. For example, the agent licenses in contact centers might include workforce optimization and multiple AI-enabled applications.

The bulk of the agent license cost is for the contact center platform itself. On average, companies spend $60 to $150 on the platform per agent per month. Depending on the provider, various features, such as social media management, outbound dialer and workforce optimization, may be included with the base platform, which is why it’s imperative to do an apples-to-apples comparison between providers.

AI-enabled customer experience

Additional spending typically comes in the form of artificial intelligence and agent analytics. CX leaders are evaluating a variety of AI-enabled capabilities, including the following:

  • sentiment, agent and predictive analytics
  • virtual assistants
  • natural language processing
  • real-time voice transcription
  • language translation

On average, businesses spent $468,887 in 2019 on the technology to support AI-enabled CX initiatives, and the cost varies based on the size of the company. Those with less than 250 employees spend $53,202 per year, while those with more than 2,500 employees spend $2.3 million. Nearly 70% of companies plan to increase their spending on AI this year.

Moving to a cloud contact center

Many companies are reaching end of life with their on-premises contact centers and are evaluating a move to a cloud contact center. Most small and midsize contact centers — as well as a growing number of large contact centers — are making the move.

Benefits of moving to a cloud contact center include a reduction in operating costs, an increase in communication channels and better preparedness for implementing advanced applications.

Those staying on premises are spending an average of $495,557 on their on-premises system. Again, the spending varies by size. Those with 100 or less agent licenses spend $154,860, while those with more than 500 agents spend $1.9 million — and that figure can rise dramatically with larger deployments.

CX leaders should focus carefully on their call center spending allocations. The most successful companies spend more on their call centers and have the highest measured success — including increased revenue, decreased costs and improved customer ratings — when using advanced technologies in their CX initiatives. The success group spends less, for now, on AI than the non-success group because they are rolling out AI in a limited, per-project fashion. However, more than 80% of the success group plans to increase AI spending in 2020.

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