Marketing services new BPO avenue: Nasscom

The country's premier industry body has said companies are slowly beginning to outsource their sales and marketing activities. Indicating that Indian companies will soon reap the benefit of "marketing BPO", Nasscom has said the highest growth in this sector is expected in Asia-Pacific (including Japan).

The primary objectives of marketing services are to accomplish tasks such as brand building, interaction with customers, strengthen existing customer relationships and deliver targeted, customised information and messages, on behalf of the client.

According to the Nasscom, marketing services within BPO is showing signs of growth on account of advances in technology coupled with changes in perception of the role of marketing. "Increased strategic importance of marketing, with focus shifting from short-term under pricing tactics to generate long-term customer loyalty as well as the drive to gain efficiencies and economies of scale with marketing services have also fuelled this emerging opportunity," Nasscom has said in the journal.

Stating that increased prevalence of multi-channel campaigns is another key factor for outsourcing of sales and marketing activities, Nasscom has quoted the IDC on the world wide opportunity for marketing BPO, which is estimated to be $76.7 billion in 2001.

This is expected to increase at a compound annual growth rate (CAGR) of 7.2 per cent to $108.3 billion in 2006. The US marketing BPO services reached $46.9 billion in 2001 and is expected to touch $60.8 billion in 2006, representing a CAGR of 5.3 per cent.

Currently, US holds the largest market share for outsourced marketing services as it is more open to outsourcing overall compared with international markets. However, this is set to change as Asia-Pacific prepares itself to take lead.

Meanwhile, Nasscom has also gone a step ahead to identify market inhibitors in emerging BPO marketing services.

Issues such as privacy, need for customisation, lack of precedence are a cause for concern. "While new marketing techniques and technologies have brought about a wealth of customer data and information, there are natural concerns and questions about allowing a third party to access it. Although companies may turn to third parties to help them address the challenges associated with integrating technology and multi channel marketing efforts, the fact is that e-marketing services are still emerging and, to date, have been somewhat isolated from traditional, offline world," Nasscom has said.

Drawing parallels from the dotcom burst, Nasscom has said that even though commercials were clever, few of those big spenders are still around. "As a result, marketing services are still feeling an overall identity transition," the industry body said.