On July 11, 2016, SYNNEX Corporation and Minacs announced a definitive agreement in which SYNNEX will acquire Minacs and integrate it into its wholly owned subsidiary, Concentrix. In 2013, Concentrix catapulted from a small-sized to a Top 10 call center outsourcing (CCO) player following its acquisition of IBM’s contact center business. This most recent move will establish Concentrix as the fifth largest contact center provider worldwide, with a combined CCO revenue in the US$1.7 billion range and approximately 90,000 contact center agents worldwide.
Everest Group’s recently released CCO PEAK Matrix™ Assessment 2016 identified Concentrix as a Leader. With this acquisition, Concentrix will be able to expand its capabilities across the following dimensions, and further strengthen its position in the Leaders quadrant.
- Geographical presence – Concentrix has a well-balanced buyer portfolio and delivery footprint. Minacs helps it expand its presence within North America, providing access to Canada-based buyers interested in onshore delivery. It also helps its strengthen its play in the growing India market and establish delivery footprint in Tier 2 and Tier 3 Indian cities.
- Industry presence – Minacs has complimentary set of industry focuses, and will help Concentrix establish a market leading position within the automotive sector, and expand its presence in telecom and technology verticals.
- Multi-channel solutions – Minacs has a strong understanding of the social media channel, which complements Concentrix existing e-mail and chat capabilities. Both Concentrix and Minacs have built significant multi-channel capabilities, and this acquisition allows them to leverage their complimentary non-voice capabilities to gain significant market share.
- Value-added services – Minacs has a strong set of value-added channel management services capabilities (driven by a high-level focus on the non-voice channel) as well as customer retention services (driven by a strong suite of analytics tools and technologies)
- Digital solutions – Minacs has invested in marketing optimization capabilities along with Internet of Things (IoT) services. These will supplement Concentrix’s current investment around automation. Given the adjacency of marketing and contact center sales services, building these capabilities will provide Concentrix with a solid ground to prepare for consumers’ future needs.
What does this mean for CCO market?
The rise of digital consumers and their need for a more holistic and complete contact center experience has significantly changed the market dynamics within the CCO industry in recent years. The move toward the digital customer experience means that service providers can no longer rely on their key strengths within a set of domains, and need to make sure they have capabilities across the board.
Not surprisingly, to ensure they have capabilities to fulfill digital consumers’ needs, and to be at an advantage as buyers consolidate their portfolio of CCO partners, service providers are actively look at the inorganic route. Indeed, this announcement, the second of this summer, follows Alorica’s acquisition of Expert Solutions Group (EGS) in June, and further highlights the ongoing consolidation trend in the CCO market place, as discussed in our earlier post. We think this market consolidation phase will continue as the battle amongst the large CCO players for the top slot intensifies, with acquisitions being modeled around capability enhancements beyond just scale.