Innovation Focus: Call Center Industry 2.0

This August I have been analyzing the competitive environment, the value proposition and the potential customers for SKY-click, an innovative call center solution based on Skype and developed by a Swiss start-up company based in Geneva. This company is really pushing innovation in the call center industry and has created a product that has quite a lot of disruptive potential (disclosure: I was hired by the company for a short-term consulting assignment this August).

What impressed me most about SKY-click was how little time and effort it takes to set-up this virtual call center. No additional hardware investments or software costs are required. This becomes possible because SKY-click runs on a company’s existing infrastructure of computers with Internet access. All that is required is that you have Skype installed on your computers. This ease of set-up is quite a jump from traditional call center solutions, which required hard- and software installations, consultants, complicated configurations and, and, and, …

The new breed of virtual call centers only require the registration of an account, the configuration of a couple of agents/operators, and some simple links placed within your website. Then you are ready to go. It’s done in little more than a blink. In the tradition of Web2.0 companies SKY-click gives you free access for a month so you can play around with and test the solution (after that you pay approx. $10 per call center agent per month). Since it’s so easy to set-up it’s worth a try…

What is interesting about this virtual call center solution is that SKY-click has many characteristics of a disruptive technology or innovation, a concept defined by Harvard Professor Clayton Christensen in the 90’s. An innovation, product or process is considered disruptive when its utilization allows the design of new products, services, and processes at substantially lower prices. Typically, during an initial phase, disruptive innovations are seen as unattractive by established industry players during their emergence because they are not valued by mainstream customers and because they have low projected profit margins. Therefore, products that are based on disruptive innovations are generally proposed by small and innovative companies to niche markets. The proposed products are often cheaper, simpler, smaller, and, frequently, more convenient to use. Yet, during the initial phase they tend to under-perform established products in mainstream markets. However, with their establishment in new small markets, small scale innovations raise the innovation’s performance and they start to invade established markets and conquer a dominant position.

If we look at SKY-click from the angle of a disruptive innovation we can observe:

  • It’s a solution that will first appeal to small and medium-sized companies SMBs with no call center because it’s so easy to set-up and doesn’t require any investments. This is the space where SKY-click could gain a foothold market.
  • It has most of the features of traditional call centers, such as call queuing, routing, agent/operator management, call reporting, etc.
  • It runs at substantially lower costs because it uses new popular Internet technologies, such as Skype and Ajax
  • To a certain extent the features have not all reached the quality of enterprise solutions – a fact that is likely to rapidly change with the adoption of the solution
  • At the same time SKY-click brings new features to the market that traditional call center solutions lack - and that at much lower cost.
  • An important new characteristic of Call Centers 2.0. is the integration between a company’s website and its call center. Visitors click on a button on a website and are seamlessly connected with an agent. In addition video connections are possible.

Of course there are competitors in this field of Call Centers 2.0. The biggest ones are eStara and Liveperson, which have both signed up several corporate giants. However, they seem less disruptive despite the fact that they have also introduced new features to the field. A substantial difference between SKY-click and its competitors is the pricing that runs at a fraction of the both eStara and Liverperson. Then there is the ease and speed of set-up. With SKY-click you can instantly set-up and test, whereas with eStara and Liveperson you have to ask for trials, you have to talk to sales reps and you have to negotiate prices in function of your company’s size. This all is less appealing (and even intimidating) to SMBs…

Personally, I’m curious to see if SKY-click can develop a strong foothold market entry with customer segments that are neglected by the large players. To date almost 1’000 accounts have been created. Early adopters could be big eBay sellers could rapidly adopt the solution since Skype has been swallowed by eBay – this would give SKY-click a boost. Also, an interesting foothold market could be SMBs in India, China, Brazil and Russia, the so-called BRICs countries, which's economies are growing at reckless speed. Many companies in these markets are looking for simple low-cost professional solutions to set-up call centers for the first time. The next step after establishing a foothold market and continuously improving the solution will be the attraction of new lucrative market segments leading to the potential disruption of established players.

To be continued...

The above graphic shows how SKY-click has pushed the value frontier by building on popular Internet technologies such as Skype. Compared to other competitors it can offer more value at a lower price - this is a disruptive innovation at work...