Amazon’s Potential, Disruptive, (and Welcome) Customer Contact Market Entry

Mar 10, 2017

Amazon is apparently considering directly entering the customer contact market. Its Amazon Web Services (AWS) subsidiary is looking at offering chatbots/virtual assistants (VAs), based on technology that drives its popular Alexa product, according to published reports such as this Channel Partners news story.

If realized, Amazon’s move is good news for customer contact organizations. Amazon brings to the table its immense resources and its proven ability to create and implement successful services.  But more critically, Amazon has a fine-tuned understanding of what customers need through its extensive and phenomenally successful experience of providing excellent customer service. Indeed Amazon owes its success by imaginatively meeting and exceeding customer expectations.  As a result, Amazon has built a strong brand that will popularize and give credibility of chatbots/VAs to a wider audience. 

There is a bright future for chatbots and VAs. Customers, particularly Millennials and GenYers appear to like using them.  According to a Frost & Sullivan research report, “Virtual Assistant Invasion—Will They Take Over the Contact Center”, these solutions “can play a significant part in improving the Customer Experience and creating brand recognition for a business. [They] also can impact companies’ bottom line by reducing costs and increasing revenue. “

There is presently no indication that Amazon will want to compete directly against the mainstream contact center solutions vendors for IVR, ACD, outbound, and web chat applications. AWS has been powering hosted contact center solutions for leading suppliers, such as Genesys.  Amazon would conceivably be hurting its own business model if it turned on its cloud platform customers and partners. But don’t rule Amazon out should it decide to make a big play for the contact center market to light its servers. The shuttering of brand name department store and specialty retail storefronts provides stark testimony to Amazon’s market-disruptive power.

Perhaps it is happenstance that when Amazon’s contact center market entry reports began circulating that Avaya announced the sale of its $100 million networking business to Extreme Networks.  The sale gives Avaya a timely and much-needed injection of resources to further develop its core contact center and unified communications businesses, either internally and/or through strategic acquisitions.  

The Avaya networking sale is also good news for customer contact organizations. They will benefit from enhanced or new Avaya solutions, which, in turn, will prompt Avaya’s competition to respond with equal and possibly superior products.

Avaya has long had one of the industry’s strongest brands with a large install base. What Amazon is to eCommerce Avaya is to customer contact organizations.  While most customer interactions begin online, it is how customers’ subsequent calls are handled, Avaya’s prime competency, that makes or breaks customers’ experiences with companies, and which drives their opinions of them.  Therefore every customer contact channel: voice, text-based, and video, must be tightly integrated with each other.

As the Frost & Sullivan VA report points out: “VAs can offload a lot of tasks. But that last 10-30% of an inquiry that requires nuance, intuition, judgment, or in some cases, “tribal knowledge” not found in a database or captured in best practices, can make all the difference in customer satisfaction.” 


Brendan Read

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Brendan Read is Senior Industry Analyst with over 25 years’ experience covering business, communications, staffing, and technology. He has worked in, prepared reports, and blogged on a wide range of topics including customer contact, CX, CRM, IoT, social media, supply chain, and BC/DR. He also has backgrounds in construction, manufacturing, materials, resource extraction, site selection, and transportation. He examines the broad economic, environmental, innovation, political, and social mega trends, and their impacts on businesses, markets, and society.


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