Market Overview
The Middle East contact center outsourcing market is estimated to grow at a CAGR of 9.1% during the forecast period (2024-2031) from its current value of US$ 1,632.01 million in 2023 to reach a value of US$ 3,271.51 million in 2031.
Contact center outsourcing in the Middle East is mostly driven by the emergence of the Internet, the reduction in telecom rates and the pool of educated, multilingual agents. Middle East call centers are a great option for B2B lead generation, lead generation, technical support, appointment setting and back office processing as they are 30–40% less expensive than those in U.S. For companies looking for a low-cost, high-value call center solution Middle East and Africa, UAE is an attractive and rapidly expanding outsourcing market. Call centers in UAE provide outsourced services in a variety of languages, including English, French, Arabic, German, Spanish and Italian. Saving cost is one of the main reasons companies outsource contact center services. Businesses can cut operating costs associated with infrastructure, manpower, training and technology expenditures by outsourcing. Companies can increase overall efficiency and productivity by focusing on their core business activities and strategic goals by outsourcing non-essential areas like customer assistance and back-office operations. A lot of Middle Eastern governments, including those in the countries of the Gulf, are implementing economic reforms to diversify their economies away from the mining and processing of hydrocarbons. This is causing a profound shift in the region's economic landscape. In addition, a significant contributing element to the need for contact center outsourcing services in the Middle East is the continuous growth of international corporations operating in several industries. Many Middle East governments are offering specific incentives, such as tax credits and subsidies, to draw in outsourcing corporations to promote cultural diversity.
Market Scope
| Metrics | Details |
| Market CAGR | 9.1% |
| Segments Covered | By Type,By End-User,and By Region |
| Report Insights Covered | Competitive Landscape Analysis, Company Profile Analysis, Market Size, Share, Growth, Demand, Recent Developments, Mergers and acquisitions, New Product Launches, Growth Strategies, Revenue Analysis, and Other key insights. |
| Countries Covered | Saudi Arabia,Israel Egypt,Qatar,United Arab Emirates,Others |
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Market Dynamics
Companies can save a lot of money on operating expenses by outsourcing their contact centers instead of establishing and running their customer service departments. Middle Eastern outsourcing companies frequently give reasonable pricing plans, making use of economies of scale and reduced labor costs to provide affordable solutions. Modern facilities, machinery and infrastructure are purchased by outsourcing companies to support customer service center operations. Businesses can save capital expenditures by utilizing the infrastructure of outsourcing providers to avoid making significant upfront investments in premises, software and equipment. In comparison to Western countries, the pool of workers in the Middle East is more affordable. Companies get qualified multilingual expertise at cheaper labor prices by outsourcing to nations like UAE, which helps to reduce total expenses. Middle East outsourcing companies concentrate on providing simplified and effective customer support services by integrating technology, optimizing business processes and managing performance. Businesses save money by using more resources and being more productive due to this operational efficiency. Businesses can reallocate their resources and efforts towards key operations and strategic goals by outsourcing non-essential tasks like customer care. By concentrating on core capabilities, productivity and overall efficiency are increased, which eventually results in cost savings.
The Rapid Growth in IT Infrastructure in the Middle East
Middle East has increasingly become a crucial hub of the global IT industry over the past decade. Many companies are attracted by the low tax regime, cheap energy prices and the availability of a diverse, multinational skilled workforce. The growth of the IT infrastructure has enabled the development of global contact center operations catering to multiple countries and industries. The Careem Super App has received a significant US$ 400 million investment from e&, a technology and telecoms company located in UAE. With the company's main office in Dubai, this acquisition represents a noteworthy achievement for a company that was founded a little over ten years ago. The IT industry in the Middle East has developed a robust startup environment. Fintech, e-commerce, health tech and edtech are just a few of the technology-related companies that have attracted interest and funding from both local and international investors. The growth of these companies, which has also been fueled by venture capital and government-backed initiatives, has improved the IT sector. Outsourcing businesses now collect, analyze and extract useful insights from consumer data by using business intelligence and advanced data analytics technologies because of the expansion of IT infrastructure. By giving outsourcing companies useful insights into consumer behavior, preferences, trends and sentiment, data analytics solutions enable them to improve customer interactions, streamline service delivery and drive corporate expansion. To protect client data, meet with local data protection laws in the Middle East and adhere to data privacy requirements like the General Data Protection Regulation (GDPR), outsourcing companies make use of encryption technologies, data encryption, secure networks and compliance management systems.
COVID-19 IMPACT ANALYSIS
The Middle East has suffered from the COVID-19 pandemic, a health crisis and a recession. There is a huge impact of COVID-19 on international businesses and domestic businesses in the Middle East. The effect of the Covid-19 pandemic on human life is incalculable and it continues to grow in the world. Many Middle East IT companies have asked their employees to work from remote locations via video conferencing and collaboration tools seamlessly. They are testing their systems before they implement any widespread measure to allow their employees to stay home. However, due to the spread of COVID-19, various cities in the Middle East resulted in a shutdown and due to this growing need for broader work-from-home options. As according to the Twilio report, the COVID-19 pandemic has accelerated the digital strategy of companies by an average of 6 years and 97% of decisionmakers reported that the pandemic has sped up the digital transformation of their companies. Therefore, governments and the private sector are forced to steer towards a digital economy and digital-driven use cases emerge in various sectors, such as smart office/campus, remote healthcare, e-commerce, remote education, home automation, digitized public services and AI surveillance, etc. Consequently, the adoption of digital technologies by both consumers and businesses is sped up due to this pandemic, as a result of tending to ecommerce, remote working, distance learning, online gaming and telemedicine, etc. which in turn led to the information technology sector to achieve gains during the crisis. The pandemic led to fluctuations in demand for contact center services. Customer support services were in greater demand in some industries like healthcare, telecommunications and e-commerce but in others, including travel and hospitality, they were less common. Contact center outsourcing companies have to reallocate resources and change workforce numbers in response to these developments.
The demand for information technology increased as a result of relying on technological applications in learning, holding meetings and working remotely, including; Ding Talk, WeChat Work, Tencent Meeting and Zoom, as well as purchasing products and completing financial and banking transactions via the Internet. The pandemic also creates an increasing demand for information technology which encourages most companies in the Middle East to shift to invest in cloud-based solutions and collaboration tools such as Microsoft Teams, to be able to cope with the need for remote working. Consequently, the overall spending in the ICT sector in the Middle East, Turkey and Africa was expected to grow in 2020 by 2.3% reaching US$ 212billion and regarding information technology (IT) space, it grew by1.3% achieving US$ 80 billion in 2020 compared to US$ 79billion in 2019. IT infrastructure (servers, storage and networks), IT services and software grew by 2.7%, 6.3% and 6% compared to 0.8%, 3.2% and 1.5% respectively. Middle East, the top three countries spending on IT are Saudi Arabia, UAE and Qatar respectively. the e-commerce market in UAE reached US$ 7.40 billion with 18% annual growth. Countries in the Middle East particularly the GCC are making progress in adopting relevant information technology innovations in the health sector.
Segmentation Analysis
Middle East contact center outsourcing market in email support US$ 386.68 million in 2023 and is expected to reach US$ 725.47 million by 2031, growing with a CAGR of 8.2% between 2024 and 2031. Middle East contact center outsourcing industry for email support has been steadily growing in recent years. As businesses in the region strive to improve customer service and efficiency, outsourcing email support functions to specialized service providers is becoming more popular. Middle East has a high need for email support outsourcing services in a variety of industries, such as telecommunications, banking & finance, retail, ecommerce, healthcare, travel & hospitality and technology. Every sector has unique customer service requirements and constraints, resulting in a wide range of outsourcing opportunities. The rising enterprises in the region is expected to increase the demand for email support. In accordance with the Small and Medium Enterprises General Authority (Monsha'at) report, small and medium-sized enterprises in the Kingdom of Saudi Arabia increased by 4.8% in 2023 compared to the fourth quarter of the previous year. Technological advancements like artificial intelligence, natural language processing, chatbots and automation are transforming the Middle East's email support outsourcing market. Service providers are increasingly using these technologies to increase response speeds, accuracy, personalization of client contacts and email management processes.
Furthermore, to promote entrepreneurship, Saudi Ministry of Commerce provided 314,500 commercial registrations for enterprises and establishments in 2022. Rising registrations will eventually fuel need for email support in the region. The widespread usage of digital payments, as well as the advent of new technologies such as artificial intelligence, cloud computing and blockchain technology, are expected to boost growth in the BFSI sector. For example, Barko, a microfinance organization, plans to join the South African retail banking market with a new digital bank based on Temenos Transact and supported by The Temenos Banking Cloud. Riyadh, Saudi Arabia's capital and largest city, is driving the country's digital revolution. The marketing and advertising industries will be significantly impacted by Crown Prince Mohammed bin Salman's Saudi Vision 2030 initiative, which seeks to diversify the economy. It will increase demand for email support during the forecast period. Compliance with data protection and privacy legislation, including the General Data Protection Regulation (GDPR) and local data protection laws in the Middle East, is critical for email support outsourcing companies. Ensuring data security, confidentiality and regulatory compliance is critical to maintaining client trust and meeting industry standards. Outsourcing email support enables businesses to provide prompt, personalized and efficient customer service experiences, resulting in higher customer satisfaction, loyalty and retention.
Country Analysis
Saudi Arabia contact center outsourcing market reached US$ 406.21 million in 2023 and is projected to reach US$ 789.76 million by 2031, growing with a CAGR of 8.7% from 2024-2031. Saudi Arabia is currently undergoing a major economic transformation as the government seeks to diversify away from oil and gas. Previously, government services and BFSI were the two major demand sources for contact center outsourcing the country. With the Saudi government unveiling a roadmap, ‘Vision 2030’ for making Saudi Arabia the defacto hub for high-tech industries and tourism in the region, the demand for outsourcing services is expected to expand to new industries. Under the Vision 2030, the Saudi government has poured massive amounts of capital in new infrastructure projects. One of the major such projects is NEOM, a US$ 500 billion greenfield smart city project based in the northwest of the country on the red sea coast. The new smart city is expected to become a major hub for tourism and high-tech industries. The smart city and its associated service industries are expected to generate major demand for contact center outsourcing services during the forecast period. Following the success of the 2022 football world cup in Qatar, Saudi Arabia is also looking towards developing sports-based tourism. In November 2023, Saudi Arabia was declared as the host of the 2034 football world cup. Sports-based tourism will further boost the demand for contact center outsourcing services, especially from associated sectors including e-commerce, retail and the hospitality.
Saudi Arabia is also looking to develop its aviation industry in order to wrest market share from its more developed peers including UAE and Qatar. In March 2023, Saudi Arabia launched Riyadh Air, a new low cost carrier (LCC), intended to connect major cities in Saudi Arabia with more than 100 global destinations. Earlier, in November 2022, Saudi Arabia announced the launch of the King Salman International Airport project, to develop a new airport for the capital city of Riyadh. The new airport is expected to have an annual capacity of 185 million passengers and will be key in attracting tourists to the country. The growth of the aviation industry in Saudi Arabia is expected to create hundreds, if not thousands of customer and back office support jobs. However, there are some structural factors which could inhibit the growth and development of the contact center outsourcing market in the country. The lack of a business friendly environment has meant that most companies offering contact outsourcing services are based in UAE. In the past multinational companies have been threatened by the Saudi government to relocate their middle eastern operations to Saudi Arabia from UAE or risk discontinuation of business ties. Such developments create a negative perception among investors and are unlikely to be received favorably by outsourcing service providers. Furthermore, to tackle persistently high local unemployment rates, the Saudi government has an official policy of preferring local citizens over expatriates to fill various state and private sector jobs. Such a policy could present challenges for market growth as many outsourcing companies rely on foreign workers to keep operational costs competitive.
Market Share Analysis
Several prominent companies competing vigorously to maintain and expand their market share. Multinational companies are facing stiff competition from regional companies, which are more adept at responding to changing local conditions and also have a decisive advantage in recruiting skilled workforce at lower costs. The top five companies in the middle east contact center outsourcing market companies hold 75.16% of the total market in 2023, whereas the major three players account for nearly 53.56% of the total market. Companies operating in the middle eastern market are increasingly focusing on geographic expansion to drive future growth and are mainly targeting emerging markets such as Oman and Bahrain. Some large contact center outsourcing companies are even contemplating initial public offering (IPO) to raise capital for further expansion.
