Zendesk acquires Local Measure CCaaS, CX platform

Zendesk plans to acquire Local Measure, an Australian contact center as a service and customer experience platform, the company said Monday.

Local Measure's customer service features include AI agent-assist tools, AI automations and vertical specializations in retail, telecom, travel and hospitality, financial services and government. Like Zendesk, it is built on AWS.

The acquisition is expected to close in May after a Local Measure investor vote and clearing Australian court approvals.

Terms of the deal were not disclosed. The startup has raised almost $12 million over five rounds of funding since its founding in 2014, according to CB Insights.

Some of Local Measure's high-volume CCaaS features include call routing, AI-powered automation, the unification of inbound service and outbound sales and marketing efforts, and analytics to monitor and improve service quality. Local Measure's voice technologies fill in some gaps in Zendesk's offerings to create a more complete CCaaS platform, which Zendesk first launched in 2011. It will also enable Zendesk to handle higher call volumes and infuse AI deeper into its interactive voice response systems.

Local Measure is a longtime Zendesk partner and it also has tight integration with AWS AI services. Zendesk's planned acquisition will deepen its partnership with the cloud giant to deploy more AI for customer service, said Tom Eggemeier, CEO of Zendesk. It paves the way for Zendesk to serve organizations with larger, more complex service environments.

The acquisition is a "very good move," and the importance of Local Measure's AWS connection should not be overlooked, said Liz Miller, principal analyst at Constellation Research.

"The AWS Marketplace is a very important place to be right now, especially if you are an AI [company]," Miller said. "If you want to deploy AI, you need to be integrated into the rest of that AWS estate and integrated into the rest of that data."

The AI piece is just as important, said Adrian McDermott, chief technology officer at Zendesk. Local Measure has AWS Bedrock-based AI agents that automate customer service and others that assist human contact center agents. Those include generative AI bots that craft responses to customer questions, a writing assistant, multilingual translation tools, call summarization capabilities and form fillers to accelerate processes an agent might perform, such as processing a refund.

Zendesk, McDermott continued, plans its product around projections that 100% of service interactions will involve some AI in the next three years, with 80% of those fully automated and solved without a human agent. The remaining 20% will require a human agent. Acquiring Local Measure fast-tracks the integration of those tools that improve both the quality and efficiency of service Zendesk customers will be able to offer.

"Voice is probably going to see a boost [in volume]," McDermott said. "After we exhaust the automation capabilities, the thing that we really need is to speak to a human synchronously [after] we've obviously tapped out or have a problem that needs an emotional, physical, human connection."

Don Fluckinger is a senior news writer for Informa TechTarget. He covers customer experience, digital experience management and end-user computing. Got a tip? Email him.