Service providers will find ample opportunity in content moderation services, but they must proceed with caution

The BPO industry has been buzzing since Cognizant’s announcement to discontinue its content review and moderation services, reportedly freeing up about $250 million of revenues for the taking. While questions whirl about why and how Cognizant will gracefully exit this market, HFS decided to examine the nuances of this tricky but very critical work that most digital enterprises need help with. Should services firms that don’t have a piece of the content–moderation pie take another look? 

The opportunity: content moderation is an important part of digital CX, and it’s crucial to a company’s brand 

Content moderation is one of the pieces of the larger marketing and sales services segment, often fueled or accompanied by CX design and consulting capabilities, where Cognizant placed No. 4 in our 2019 Top 10. Content moderation is the monitoring of typically user-generated content on the web (such as text, images, and videos) to validate its adherence to a company’s content rules and guidelines (such as for social media, wikis, blogs, and reviews) and often to remove content that does not meet the requirements. The most obvious argument for this services opportunity is the high volume and growth of user–generated content. Opportunity for in-house penetration is hot, where companies running content moderation internally are struggling to scale to keep up with the volume. It’s also an area that’s ripe for tech–savvy service providers to jump in with clever AI and automation capabilities to reduce the reliance on human labor. Most importantly, content moderation is critical work that is inherently tied to a company’s brand safety and social media strategy. 

The difficult (and the ugly): consider regulatory environments and employee discomfort 

With recent general and political sensitivity to the big tech firms and their use of data, and potential legislative changes regulating social platforms, the expectations of what a platform will allow in terms of content will continuously evolve. (Cognizant provided services most famously for Facebook, whose controversial congressional hearings, including the difficult parts of content moderation, were likely a part of Cognizant’s decision to quit this market.) Service providers must be ready to deal with potentially changing guidelines and different expectations across borders.  

There’s also a very ugly side to this work: content moderators must review and make judgment calls on sensitive content, including copyright infringement, major incidents, and viral events, as well as potentially disturbing content such as hate speech and images of violence and terrorism. These sensitive issues, though a small percentage of the work, are an unavoidable element of the employee experience that employers must deal with. In an ideal world, AI–powered visual recognition algorithms would remove this unpleasant aspect of the work, but for now, it remains a primarily manual task.  

Most importantly, from a strategic standpoint for service providers, content moderation remains an FTE-focused service, if not included in a larger engagement that includes strategic work on a company’s CX and social media strategy. 

The marketing services market is ripe with opportunity for services firms that have a blend of strategy, creativity, technology, and operations 

While the work in marketing services for BPOs has largely been on the tactical end of the spectrum, these firms have started to move toward the more strategic, and creative side by bringing in design and consulting capabilities. Traditional agencies are known to lack the business outcomes focus and technology prowess needed for the evolving world of digital CX, and they are known to lack flexibility, so services firms have started to take advantage of needs for services that overlap operations and design (and are making acquisitions to bolster those capabilities). 

Exhibit 1: The marketing services market is ripe with opportunity for services firms with a blend of strategy, creativity, technology, and operations 

^{Source: HFS Research, 2020} 

The competitive landscape includes the usual suspects—plus some dark horses 

Aside from Cognizant as it takes a step back from this market, other players in this space include Wipro, Accenture, HCL, Genpact, and Tech Mahindra. These companies combine expertise, scale, and horsepower to deliver on the increasing volume of content moderation needs. Beyond the usual suspects, emerging work models such as crowdsourcing platforms will make a big impact in this space (such as TaskUS and CrowdSource). It’s likely that front–office players want a piece of the pie (including Teleperformance, Alorica, and SYKES), applying their already employee-focused cultures and social media expertise to these solutions. Technology-led solutions like Conectys and image recognition software players could present competition (Google, IBM, Clarifai), though probably as a partnering opportunity for service providers instead of direct competition.  

If your firm forges ahead with a content management strategy, be sure to consider the following: 

• Put a huge emphasis on trust and safety. There’s the undeniable sticking point that this work is largely brand protection, and therefore critical to your clients’ businesses. 
• Be very sensitive to talent attraction and retention. Make sure employees have the tools and support needed. 
• Be ready to use AI tools. Consider the evolving role of AI, and get ahead of the game in reducing employee exposure to graphic material. 
• Consider starting outside of social platforms. There are less–risky areas, such as user–generated content for retail, travel, and hospitality—think of all the reviews! 

• Be prepared to be agile. Regulatory and guideline changes will be inevitable; be ready to pivot quickly. 

The Bottom Line: Content moderation services should not be a standalone offering: develop capabilities in conjunction with analytics and consulting, and be aware of the risk. 

Most importantly, do not offer content moderation as a standalone service; instead, make it part of a marketing and CX solutions portfolio. Make sure that these services are anchored well up the value chain; use them in tandem with strategy and design as well as content curation, analytics, and sentiment analysis to make this a truly valuable service to your client’s brand.