February 28, 2008, 12:00 AM

10 tips for employing live chat profitably

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Relevant invitations can help sell customers add-on items, says Scott Carlin, vice president of sales at InstantService Inc., a chat provider. If a customer buys a fishing rod but doesn’t look at reels, a retailer can extend an invitation to chat about reels that match the rod, Carlin says.

“The customer now knows they can lean on the retailer’s expertise about the products they’re looking at,” Carlin says. “They’re more likely to click a chat invitation like that.” Overall, about 15% of visitors to retail sites accept proactive chat invitations, according to Kohn of LivePerson.

5. Don’t offer chat when it’s not available

While some retailers extend invitations to chat, the proactive approach, others put chat buttons on their site, letting the customer choose when to initiate a chat. Retailers that choose the reactive approach must decide what to do when no agents are available, either because they are busy or because the contact center is closed. Approaches vary.

Ritz Interactive, operator of web photography, fishing and boating web sites, and Day-Timers Inc., which sells pocket planners, briefcases and handbags, both use “smart button” technology from InstantService that hides the chat button when agents are not available. Orvis, another InstantService client, leaves the chat button up, but adds text saying that live chat is temporarily closed if agents are unavailable.

At Improvement Direct, if chat is unavailable a customer who clicks on that button will get a message asking them to send an e-mail or to try again when chat is available. Chat agents typically are available from 6 a.m. to 6 p.m. daily, says Ryan Brewer, vice president of operations at Improvement Direct, which uses chat technology from Velaro.

Retailers that have many repeat customers are better off having the button visible all the time, advises Talisma’s Lowy. “You don’t want your most profitable, repeat customers to look for the button, not find it and get frustrated,” he says. When agents are not on call, he suggests the chat button link to an offer of another source of help, such as phone or e-mail.

6. Give agents the information they need

Agents should have access, at a minimum, to all the information the customer can see on a retailer’s web site, Lowy says. And the information should be consistent across channels. “Customers are smart and will keep going until they get the answer they want, instead of the right answer,” he says. For instance, if the web site says there is a restocking fee on returned items, a customer might seek a better deal from a chat agent.

Agents should also have access to information on inventory and order status. “All our agents on chat are tied into our ordering system, warehouse system and inventory system,” says Fred Lerner, CEO of Ritz Interactive. Agents can also query supervisors for answers, then provide them to the customer. Ritz, which made chat more prominent on its web sites this past holiday season, found customers who chatted converted at a rate of 10%, well above the rate of non-chatters.

Another tip is to provide agents with information about the purchase history of returning customers. That can generate add-on sales, especially for retailers selling complex products like computers, says Louvat of inQ.

For instance, if the customer bought a computer recently, but didn’t buy a popular software package, that’s a prime selling opportunity. “Within three months of a purchase, that’s the sweet spot,” Louvat says. “The further you go from a purchase date the less likely the customer is to buy add-ons.”

7. Customers won’t wait long, but will chat a while

Most retailers want agents to respond to chat requests within 20 seconds, lest customers give up. One retailer’s average response time for a week during the holidays was 15 seconds-and 10% of customers were already gone.

Ritz found customers were more patient during the holiday season, in some cases waiting up to 2 minutes and 20 seconds for a response before clicking off, compared with 1 minute before and after the holidays. To keep customers from losing hope when seconds tick by with no response, some retailers send automated messages periodically to assure a customer that an agent is working on his request.

Once engaged, customers will stay on a while-chats averaged 8.11 minutes in the E-Tailing Group’s mystery shopper survey last fall-and agents have to learn how to gently say goodbye.

Chats go on in part because customers, once engaged with a knowledgeable human being, often think of additional questions to ask, Lowy says.

He suggests the following four tactics agents can use to bring a chat to a close: try to cross-sell or up-sell, which often leads the customer to end the chat; offer a friendly “Have I answered your question today,” a subtle hint the chat is ending; less subtly, say the chat is over and invite the customer to return if she has more questions; and offer more information through e-mail, a less costly channel.

8. Find agents who are up to the task

What kind of person makes a good live chat agent? For starters, someone who can handles calls on the phone, says Steve Addy, project center manager for the contact center at Day-Timers. Once someone is qualified on the phone, the retailer gives a writing test to see if the agent can handle e-mail and chat, Addy says.

Wolansky of Orvis looks for a special type of communication skills along with product knowledge. “The type of people who are the most successful chatters know the product, know the site inside and out and are very clear and succinct communicators,” Wolansky says. “They can get their ideas across in as few words as possible and type quickly.”

Retailers must train their agents to convey the warmth of a smile in their typed responses, just as a phone agent uses inflection to convey empathy on the phone, says Jeff Fettes, chief operating officer of 24-7 INtouch. Ways to do that include: say “please” and thank you” often, personalize canned responses with the customer’s name, and pay close attention to what customers say so they don’t have to repeat themselves-a challenge when agents are handling several chats at one time.

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