Slowdown in West boon for city KPO firms

India's IT capital Bangalore is also turning into a major location for 'market research outsourcing' (MRO) though firms expanding their marketing related back-office operations in the city in a big way. Much of these jobs are high-end, though non-core.

Companies such as Empower Research and Markelytics are expanding as more and more companies from the US are outsourcing.

The days of outsourcing low-end, low-returns jobs to India may be numbered. The ones that have a greater chance are the high-end, high-return outsourced jobs as they command better margins, hence a greater cushion during the present economic slowdown in the US.

While, till now many Fortune 500 firms outsourced their non-core low-end jobs, many of them are beginning to outsource their high-end non-core activities as well.

India today has become the lead location for offshoring knowledge processes. Most of the outsourcing is to captives set up in India. The US, which has a $25 billion 'market research' industry, is now seeing increasingly greater MRO back-office work being done in India.

"With much of the MRO work today being done over the Internet or over the phone, it is feasible to conduct market research from anywhere," said Jasal Shah, CEO, Markelytics. Markelytics lives on market research work offshored to Bangalore.

Markelytics claims to have successfully delivered over 300 projects for over 30 customers across the globe, including SAP, BBC, Gallo and Gallup. Cost-arbitrage is again the reason for the outsourcing of this type of work to India. The job that costs $100-300 per hour in the US costs $25-30 a day in India, he adds.

Firms have little logic in clinging on to the most recent type of market research work as they have little control over it. Messaging and the task of setting the communications agenda is now controlled by customers. Weblogs or blogs often play an increasingly important role compared to the traditional media.

EmPower Research, a New York-headquartered business research and information consulting firm, provides blog analysis focussed on insights rather than just data, as also data mining for firms. Through blog analysis, it provides a method to synthesise and comprehend the blog environment. This is done by identifying key trends and analysing them for a particular brand and company.

When a US firm plans to enter a market, say South America, and wants to know more about the market for a product, it can now turn to a firm that would do the work for them. Earlier, such work used to be done by the companies themselves.

Or, the companies would like to know if it has been able to communicate to the market effectively enough. Research of this type requires carrying out processes that demand "higher end, much more advanced research, analytical, interpretation and technical skills, which require judgement and decision-making skills to deliver value," said Debjani Deb, Co-founder and Managing Partner, EmPower.

One of its customers is Panasonic and another is a global mobile handset firm.

EmPower helps global firms to outsource parts of their market research and media monitoring work by offering business research and information consulting services. It operates three practices "" business research, media services and information support services.

"We do a part of the work that consulting firms do," said Shoma Bakre, co-founder and Managing Partner, Empower.