Cloud Contact Center: What Is It & How Does It Work?

October 27, 2021 | 13 min read

What Is a Cloud Contact Center? How They Work, Features & Benefits Compared.

Cloud-based contact centers help businesses manage the customer experience across phone, email, text, and social media. It offers advanced functionality that goes beyond inbound and outbound calls.

As organizations add more support channels, a cloud contact center solution helps them stay on top of every customer request and optimize agent productivity.

Choosing the best contact center software can be tricky. So we’ve curated a guide that covers the differences between call centers and contact centers, how they work, and noteworthy features. Finally, we’ll wrap with advice to help you select the best contact center.

Introduction to contact centers

For decades, call center software exclusively used the phone to resolve customer concerns. While this is still the primary customer engagement method, additional channels have emerged as a mainstay of the customer experience.

Since about 2012, social media has become a noteworthy consumer choice for customer care. Now, the digital channel is a universal instinct to criticize a product or service publicly. These fiery social media posts hurt brands and can escalate if they go unaddressed.

As social customer care evolved into a public support forum, call centers needed a quicker solution to respond to customer concerns. However, not everyone wants to dial in or wait on hold. Organizations once boasting about agent performance were being thrashed in the headlines for customer journeys gone awry.

For this reason, the omnichannel, cloud-based contact center was born.

Contact center agents use powerful tools to address customer concerns and respond via phone, email, text, social media, and video. Of particular note, these solutions provide official branded touchpoints securely via social media APIs. As a result, these cloud contact center platforms elevate customer satisfaction regardless of where the customer needs help.

Contact center definition

Many companies operate a contact center as a business unit to handle customer requests across multiple channels such as the phone, email, tickets, and chat. This functional group may work from one or more locations, including working from home or office.

Such departments use contact center software to manage inbound and outbound customer communications. Today’s contact center solutions include:

  • Omnichannel capabilities across phone, email, SMS, and video.
  • Data integrations with CRM, helpdesk, and marketing software.
  • Analytics and reports on cases, calls, quality management, and self-service.
  • Customer interaction tools for agents and supervisors to reduce call volume using workflow automation.

How does a cloud contact center work?

A cloud contact center provides inbound and outbound voice, text, social media, and video communications over a high-speed internet connection. Contact center providers handle all the technical setup, equipment, and maintenance of the servers.

Unlike an on-premises PBX, there isn’t any telecom hardware to purchase, install, and maintain. Instead, phone calls are established using Voice over Internet Protocol (VoIP) technology.

Once you connect the cloud contact center software to your other channels like social media or email, it does all the work. Each interaction is tied to an account and assigned to the right agent to avoid conflicts. Then, a contact center syncs data with your CRM software in the background, so everyone is on the same page.

Since a contact center works entirely over the internet, it means you just need to provide workstations, headsets, and an internet connection for your team. Then, when agents log on, they can receive calls, emails, or chat messages. As a result, your brand interacts with customers consistently across various contact methods.

Cloud call center and contact center differences

The most significant distinction between call centers and contact centers is how agents interact with customers.

Cloud-based call centers handle a heavy volume of inbound and outbound phone calls. Agents talk with customers over the phone in real time. Since it’s in the cloud, it’s scalable, and employees can work in the office, remotely, or a hybrid of both.

A cloud-based contact center manages inquiries across phone, email, social media, text message, and video. In addition, support agents can view customer data and past interactions. As a result, customers can get support regardless of where they seek it. Agents may reply via an online message or initiate an outbound call with a software-based dialer.

The role of a contact center has expanded from fielding customer service inquiries to driving customer success initiatives and equipping salespeople with multichannel tools to engage their leads.

Secure data integrations and endless customizations make cloud contact centers the ideal solution for service and sales teams to hit their growth targets.
Related: Customer Success Process: How to Drive Revenue & Lower Churn

Comparison: Cloud contact center vs. call center PBX

FunctionCloud contact centerCall center PBX
Setup Time1–4 weeks6–12 weeks
ScalabilityFeatures delivered on-demandRequires extensive hardware upgrades
IntegrationsNumerous API-based integrationsLimited middleware integrations
FlexibilityEmployees can work in the office and remotelyEmployees must work within an office
AnalyticsReal-time customer journey analyticsLimited to agent dispositions
(Assumption: 75 seats)
Approx. $100 per agent per month that grows with you.Approx. $75,000 upfront per agent, plus software licenses, trunks, and maintenance
ReliabilityRedundant upstream carriers monitored 24/7Less susceptible to jitter over the internet

12 noteworthy benefits of a cloud-based contact center

There’s no avoiding this reality: on-premises call centers are quickly becoming outdated. Here’s why.

On-prem contact centers require employees to be physically present, perform maintenance, and finding hardware is scarce. On-site call centers revolve around phone conversations, which don’t address the modern customer experience. For these reasons and more, cloud-based contact center solutions are the right approach for high-growth companies.

Gartner predicts that spending on contact center solutions will reach $15.2 billion in 2023. Additionally, IDC reports that business cloud solutions continue to outpace (54%) on-site technology investments (46%).

Cloud contact center spending versus on-premises forecast (IDC)
Analysts forecast cloud-based infrastructure continues to unseat on-prem solutions. (IDC)

Cloud contact centers are entirely different. They offer accelerated setup, improved flexibility, and real-time analytics. In the end, this means lower operating costs, gains in customer experience, and faster time to market.

Here are the top advantages cloud contact centers have over traditional call center deployments.

1) Lower setup and ongoing costs

Our comparison between VoIP and landlines shows that businesses stand to save up to 65% when they switch from analog. It’s not just the monthly cost that matters.

Organizations that opt for a cloud-based contact center won’t need to budget for real estate, redundant power (diesel generators), multiple network carriers, security audits, and the staff to troubleshoot client software.

A recent Microsoft report found that 82% of businesses reported cost savings when they moved to the cloud. Why is that? Without the hard costs of hardware or expansive IT workforce, a cloud-hosted PBX system is more affordable.

The best part? The cost savings of a cloud-based system don’t stop there. There are likely several apps you pay for that can be replaced by cloud contact center software, too.

2) Built for remote work

With many companies now working from home and the office, cloud contact centers provide the ultimate flexibility. Everyone stays connected no matter the location. Supervisors and call center directors can keep up with the team wherever they work.

Cloud-based contact centers are engineered to work across a variety of devices and operating systems. They also provide real-time reporting to provide greater transparency into productivity and customer experience.

When people work remotely, end-to-end security is essential for customer and employee privacy. Cloud call center solutions are audited routinely to avoid unwanted data breaches.

Employers and employees largely satisfied working remotely. (PwC)
A vast majority of employers and employees indicate remote work has been successful. (PwC)

3) Rapid installation and setup

The setup window is much shorter with cloud contact centers. While there’s typically no hardware involved, you can customize anything in a matter of minutes, not months. Onboarding employees is instant, and you won’t need to meddle with endless IT support requests.

Besides handling inbound and outbound calls, contact centers can start associating customer interactions from past emails and CRM connections.
And when your supervisors need to pull stats on calls, cases, customer surveys, and employee performance, they can do it in minutes. Cloud-based contact center solutions are explicitly made for sales and service teams rather than cobbled together.

Celebrate! That means no need for SQL queries, terminal access, or four-inch thick admin manuals.

Teach your contact center new tricks.

Check out the Nextiva Contact Center today.

4) Superior performance

When you add more employees and handle more customer inquiries, cloud-based systems are pretty resilient. It’s because they use virtualization technology to spin up more server resources instantly. No matter how many calls, cases, or employee interactions you have, you’re covered.

Cloud contact center leaders have invested in their network to ensure maximum redundancy. Since customer interactions travel through the internet, providers use multiple network backbones to provide noticeable gains in uptime and responsiveness.

If your internet service goes down, you can deploy messaging to customers and route incoming calls to agent’s cell phones as a backup.

With on-site physical phone systems, you have finite resources. And when you need to upgrade, you must take it offline. To maintain them, you need a full-time staff dedicated to server upgrades, backups, and planning around your schedule.

5) Improved agent productivity

Example of cloud contact center software from Nextiva.

With the right toolset, employees can provide an excellent customer experience. Let’s get specific for a moment.

The uncomfortable truth is that many companies use several — make that, dozens of — internal and external tools cobbled together to address fragmented workflows. This inefficiency saps productivity.

Ask any customer service agent, and they’ll surely mention their sluggish tools. Cloud contact centers like Nextiva put agents in the driver’s seat with an optimized dashboard tuned for each type of customer inquiry. It can save hours of context switching and lets your team anticipate customer needs.

Another victory here is the click-to-call functionality that minimizes misdials and places outbound calls faster.

But that’s not all. Cloud contact center platforms leverage artificial intelligence to resolve customer concerns before they even reach the agent. At a minimum, they can intelligently direct incoming calls to self-service to improve the customer experience.

6) Plenty of room for growth

Cloud-based call centers let you add as many users, calls, or cases as you want. So there isn’t any additional wiring, complicated configuration, or pesky IT requests to submit. The best part here is that you can start small and grow when you’re ready.

With on-prem voice solutions, you need to go big on day one. And you’ll need to upgrade when you hire, add new locations, and support more customers.

You have a couple of options to consider for each user. We suggest you stick with a VoIP phone setup for the most comfort and familiarity. Otherwise, employees can use their browser or a VoIP app to field inbound calls and tickets. Don’t forget that you can offer employees both hardware and software options!

7) Enterprise-grade reliability and uptime

Traditional phone systems are more susceptible to localized outages than cloud-based ones. Common risks include severe weather, building hazards, and even regional network outages. They’re no fun for anyone. For some firms, their network sits atop telephone networks, so when they’re down, you’re down.

Nextiva cloud data center locations.
Nextiva has one of the most reliable business voice networks in the U.S.

Cloud phone systems adopt a different tact. They are built for reliability from the ground up. Cloud communication providers like Nextiva monitor the network 24/7 to ensure everything runs smoothly. It’s no small feat. Many offer an enterprise service level agreement (SLA) upon request.
Related: Is VoIP Reliable? Nine Facts To Know Before You Switch

8) Industry compliance with hardened security

Conventional wisdom suggests that moving your communications in the cloud opens you up to more attacks, but that’s not the case in practice. With call encryption (TLS and SRTP), permissions management, and extensive logs, you can neutralize potential threats.
Only a handful of cloud contact centers undergo audits to ensure they meet the rigorous standards to process credit card payments, discuss private health information, and handle sensitive personal information. Accreditations to look for include PCI-DSS, HIPAA with business associate agreements, and SOC 2. And if you do business in California, look for CCPA compliance as well.
On-prem solutions require you to perform regular, costly audits. But more importantly, it places confidential customer and employee data at risk. In particular, security updates depend on IT staff to deploy regularly.
Cloud contact centers provide you with the assurance you need to work safely and securely.

9) Vibrant integration ecosystem

Cloud data integrations by Nextiva

Most companies use essential systems that they can’t let go of. Contact centers use approved third-party integrations to bridge the digital divide between critical business applications.
In Salesforce’s State of the Connected Customer study, they uncovered some intriguing trends around consumer sentiment. Almost two-thirds of consumers have to repeat themselves to different representatives. Similarly, 54% felt that sales, service, and marketing teams don’t share information.

Integrations extend and multiply essential functionality on the front-end for agents and supervisors; it also syncs data continuously in the background for system admins.
Here’s a scenario of where these integrations can help.
Let’s say you’re helping someone out over Twitter. You can identify which account belongs to “@TotallyRadPerson” if they received help before. The CRM integration pulls up purchases, calls, ticket history, surveys, and potential upsell opportunities. At a glance, you’ll see that the customer prefers you call their cell phone instead of their work phone.

10) Tracks real-time analytics

One of the underrated advantages of cloud contact centers is the simplicity of measuring every stage of your customer experience. This strength comes in two forms: real-time dashboards and custom reports.
For agents and supervisors, they can see at a glance how they’re progressing. It also helps with scheduling and workforce optimization, so people aren’t too stressed or careless with their time.
Call center managers and directors can use the historical data to forecast trends, satisfaction scores, and dissect cross-sections of customer data.
A common complaint among contact center staff is when they track stats using two sets of numbers. This breeds mistrust and finger-pointing. Since cloud-based contact centers keep everyone on the same page, you can instill trust and achieve growth.
On-site contact centers can provide these data points, but it’ll take work. You’ll need to export the raw data and assemble various charts and graphs in Excel. Not impossible, but complicated, yes.
For more sophisticated on-prem call center reports, you’ll likely need a data analyst savvy with SQL who can compile ad hoc reports and remind them to pull them for you regularly. That’s not very efficient, is it?

11) Ease of management

Adjusting the settings in a cloud contact center is easier for both experienced IT staff and business professionals. Don’t overlook this advantage.
When you want to make a quick change or modify permissions for users, you can carry out those changes instantly. This freedom lets you truly manage the system, not the system managing you. (We’ve all been there.)
Administrators can manage every setting from a secure web portal. It’s accessible from anywhere on any connection, in case you need to make changes in the middle of the night.
Since a contact center touches more than phone calls, admins can adjust incoming cases, post-interaction surveys, agent views, and more. This flexibility comes in handy as companies grow and add new services or product offerings.

12) Delivers a better customer experience

The goal of a contact center is to solve problems for your customers. You want to make it easy for them to get in touch. Lasting customer relationships require seamless customer experiences.
Traditional customer support tools struggle in multichannel environments. For example, online ticketing tools are designed for online interactions, but what happens when they pick up the phone? Or reply to an order confirmation email? Or respond to a promotional text message?
Consider the communication channels your customers prefer. For example, Microsoft’s Global State of Customer Service report cites that almost half of customers use up to five different communication channels to resolve their issues. Therefore, offering an omnichannel routing approach is key to keeping your customers happy.
Take to heart that cloud contact center tools reduce the burden on the customer and equip agents with the means to solve their issues.
As you perfect your contact center experience, you can add more outbound channels to serve customers proactively.

Tips for choosing the best cloud contact center provider

Getting acquainted with the best contact center software takes time because you have to hop on product demos, compare requirements and capabilities, and settle on pricing.
So, here are recommendations to keep in mind as you scope out cloud contact center software.
Uptime: Proven performance and reliability are paramount in the contact center industry. Look beyond a service level agreement (SLA) to see its status updates are posted publicly.
Analytics: Solving customer concerns is just the beginning. Measuring resolution rates across contact channels, accounts, teams, and individuals are essential to growth. Ensure that this data is accessible and intuitive for most users.
Supervisor Dashboards: In the world of remote work, ensure that team supervisors can track the real-time performance of their teams, intervene if someone needs help, and maneuver around easily. With enhanced workforce management features, they can plan out agent schedules and anticipate customer cases.
Smart IVR: This type of interactive voice response (IVR) system responds differently based on caller ID, account status, and when there’s a known issue. Look for a contact center solution that adapts to evolving business needs and customer experiences. And when the Automatic Call Distributor (ACD) directs calls to the right agent, they can see the keypresses from the IVR.
UCaaS Integration: Managing two communication systems can be a beast for almost any organization. Check into a cloud contact center’s Unified Communications partnerships for seamless integration across the enterprise. Moving your communications to the cloud ensures you have increased business continuity. (Psst! Five9 has partnered with Nextiva for this deep integration.)
Related: Snag Our Checklist To Move Your PBX to the Cloud

Scale your sales and support organization with Nextiva

Based on customer reviews, Gartner Peer Insights named Nextiva the Customers’ Choice for Midsize Enterprise and North America. Thousands of companies rely on Nextiva for scalable communication solutions to grow their businesses.
Here are three reasons why Nextiva stands out from the rest:

  • Excellent network reliability: Nextiva offers eight data centers across the United States that have reliably connected billions of calls every year.
  • Amazing Service: Every account benefits from our award-winning customer service, with 24/7 support, monitoring, and hands-on guidance whenever you want it. Our onboarding takes care of everything so you can focus on serving customers.
  • Ease of use: Take the guesswork out of meeting your growing needs with powerful tools for your team. Not only are they easy to use, but they’re also easy to set up as well!

Here’s the bottom line. A contact center solution is ideal for those facing a rising tide of customer and sales requests. Nevertheless, the benefits of moving your contact center to the cloud far exceed those of an on-site solution.
You can’t go wrong with a cloud call center — it offers unmatched scalability. And when you’re ready to move to an omnichannel contact center, we’re ready.
There’s a reason why companies in industries like healthcare, logistics, and finance trust Nextiva. It’s dependable and enables them to grow faster.

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Chris Reaburn


Chris Reaburn

Chris Reaburn is the interim Chief Marketing Officer for Nextiva. He embraces the nontraditional. He was a sailor for years before I went to B school. In between roles leading public company marketing organizations, Reaburn ran a regional wireless carrier and an IT managed service provider, led enterprise sales groups, and led business divestiture, acquisition,…

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