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Summary

The recent announcement that US outsourcer StarTek is buying Accent Marketing Services is the latest in a spate of acquisitions in the front-office BPO space but is also a good strategic move. It will help StarTek shore up its scale of business, give it the benefit of Accent’s customer experience background, and expand the company’s capacity in the all-important American nearshore.

Revenue boost helps StarTek in competitive environment

By taking on Accent Marketing Services, StarTek is increasing its scale in the North American contact center services space. Based on 2014 figures, StarTek will grow its own turnover by roughly a quarter. With recent Ovum research suggesting that enterprises see vendor financial stability as a key factor in their choice of outsourcing partner, this will serve as a point of differentiation for StarTek as it aims to win over prospects and retain existing contracts. This is in addition to StarTek’s improved revenue performance over the past several quarters, which has been pronounced.

Customer experience capabilities are an acquisition benefit

In its statement announcing the acquisition, StarTek highlighted the customer experience capabilities that would come as part of the deal. Indeed, the analytical background that Accent has cultivated with its Customer Engagement Agency model should serve StarTek well, given the intense focus so many enterprises are placing on both strong front-line delivery and data gathering around these interactions. It will be essential for StarTek’s executives to identify complementary elements to their own customer experience program, and to integrate them as quickly as possible.

Jamaica lets StarTek solidify its nearshore positioning

With the Accent purchase, StarTek is also gaining new capacity in Jamaica, which is currently one of the more popular nearshore CRM delivery markets among enterprise contact center managers. StarTek has already established a nearshore beachhead in Honduras (with sites in San Pedro Sula and Tegucigalpa) for Spanish-speaking and bilingual delivery. With Jamaica now one of its delivery options, a pool of North American-savvy English speaking agents will be important for winning more price-sensitive deals in the competitive US and Canadian markets. Nearshore delivery alternatives are proving to be more popular and important than ever in front-office BPO (a point highlighted in Ovum’s recently published 2015 CRM Outsourcing Business Trends Survey); by growing its own presence in this region, StarTek is increasing its ability to win deals.

Appendix

Author

Peter Ryan, Principal Analyst, IT Services

peter.ryan@ovum.com

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