August 1, 2007, 12:00 AM

Let’s talk

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The cost of live chat depends on how many agents use it and who hosts the service. Jupiter’s McGeary estimates a hosted chat service will cost about $70 per agent monthly for basic text chat, and about $100 for proactive chat that reaches out to consumers. An in-house operation will pay a one-time software license fee of about $1,250 per seat, going up to $1,500 for proactive chat, plus about 18% per year in maintenance fees.

Vermont Teddy Bear Co. has live chat bundled with its customer-facing e-mail service from InstantService. Live chat costs no more than e-mail in slower months when the gift retailer does not use its full allotment of customer response units, says Chris Powell, call center manager. In busier months, there is an additional charge per chat, which Powell did not disclose.

An extra cost of proactive chat is the creation of business rules for when to offer a chat, notes Fettes of 24-7 INtouch, which provides chat through agreements with chat specialists InstantService and LivePerson. That process can cost $10,000 to $20,000, including a 90-day test; he says it makes sense only for online retail sites that get 250,000 visitors or more a month. Fettes is exploring setting up a chat facility in the Caribbean where his costs would be halved compared to his three Canadian centers.

McGeary says retailers can expect to pay about $16 per hour for workers with the writing ability to handle text chat, compared with $12-$13 for a typical agent. In order to make sure a candidate can handle live chat, Bruni says Backcountry puts a job applicant into a separate room and conducts part of the interview via text chat.

The duration of each chat affects its cost. CompUSA figures a typical chat lasts three to five minutes, but that an agent is only typing for 30 to 45 seconds. E-Tailing Group says the average chat lasts just over eight minutes.

While some retailers offer live assistance only during business hours, CompUSA typically offers it 70 hours a week, upping that to 90 hours during promotional periods. CompUSA also is unusual in that it makes the chat button more visible on pages where it figures to have the most impact; the button also becomes more visible when a visitor’s behavior suggests a chat might help lead to a sale.

May I intrude?

Proactive chat remains controversial. CompUSA and Vermont Teddy Bear, for instance, do not invite visitors to chat, fearing that would seem intrusive.

But Bruni says Backcountry has had success with offering chats to customers who act in certain ways, such as repeatedly hitting the forward and back buttons on the browser or going to an FAQ page. To minimize irritation, Bruni says a customer who declines a chat will not be asked again for the next 24 hours. He says 6% of those invited accept the chat; Jupiter says 15% is typical in retail., which recently began using proactive chat, encourages agents to engage visitors browsing in categories that the agents know well. For instance, a specialist in tankless water heaters might propose a chat to someone on that page. About one in five customers accept chat invitations, says Joshua Mauldin, customer service manager.

Mauldin says live chat is an effective way to send a customer information, such as an informational video, or, after getting the customer’s permission, to take control of the shopper’s computer to lead the visitor directly to a page. “It makes for a better web experience than a phone call,” Mauldin says. says sales during chats have gone up since its chat vendor, LivePerson, added the HackerSafe icon to its chat boxes, signifying that exchanges are secure. Mauldin says three times more customers now provide credit card numbers during a live chat to complete transactions.

Most retailers say agents can handle three or four chats at a time. Faith of says he likes agents to engage in only one chat at a time to keep up service quality, but that they can handle up to six in a pinch.

Really live chat avoids using canned responses, because Bruni believes consumers come to the site looking for people with real expertise in products like skis and kayaks. But Al Hurlebaus, managing director of marketing and advertising, CompUSA, says 70% of the site’s 3,000 chats a month deal with common questions such as site navigation and promotions that can be answered with standard responses. That’s true for about half of queries at Vermont Teddy Bear.

Retailers should limit use of canned responses as consumers choose live chat so they can interact with a person, says Jennifer Bailey, a principal in web site usability consulting firm Red Spade Inc. Bailey also recommends using different colors for the text entered by the agent and consumer, and enabling consumers to print out transcripts of chat sessions.

Her firm’s audits typically show scores in the low 60s on a scale of 100 for live chat services, “which means there’s plenty of room for improvement,” Bailey says.

Given the sales lift some retailers report, getting live assistance right could be well worth the effort.

Susan’s not real, but the sales are

Gourmet Station, a web-only food retailer, can’t afford to pay human beings to chat with customers, says Donna Lynes-Miller, president. But she says an automated program she calls Susan is helping save sales.

When a visitor abandons a shopping cart, a chat window pops up with text that begins: “Susan Says: Hey wait! Please don’t go. Just this once we’d like to offer you an instant $10 savings discount off on shipping!” The customer is given a promotional code and invited to click to get the discount.

The customer also can continue the chat, and language-recognition technology from Inc. is designed to recognize the nature of the question and provide an appropriate, preprogrammed answer.

Lynes-Miller says Susan can’t answer complex questions, such as what’s the best sauce to serve with salmon. But the discount offer often is enough. She says Susan saved 10.3% of transactions from August to December last year, and has had a monthly success rate of between 11% and 21% this year.

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