What's Needed On The Web
BY LARRY WASSERMAN, LIVEPERSON, INC.
"Business as usual" on the Internet these days is not
necessarily a good thing. At first glance, it seems ideal. A customer
visits a Web site with something specific in mind, finds it, buys it and
moves on. This is the best possible scenario. In many other situations,
however, the customer has questions. Is a certain model available? Does it
come in other colors? Can it be shipped overnight? Unable to have their
questions immediately answered, customers often leave shopping sites
frustrated, completely abandoning virtual shopping carts. This is a
situation that repeats itself every few seconds on the Internet.
May I Help You?
What if there was a button, on the top of the Web page, that said,
"Click To Ask A Question," allowing customers to get their
queries answered immediately? What if the service representative answering
the customer's question had a record of all the customer's previous
purchases and company interactions? What if that representative had
knowledge about what was selling the best in the buyer's city and what
products had the fewest problems? What if that customer felt taken care of
by the e-commerce company? What if she came away feeling like she had
truly received personalized service?
Real-time interaction is what customers want, especially customers who
like to shop. Jupiter Communications reports that online shoppers' desire
for live human contact spikes upwards once the purchase price exceeds
Customers need live interaction online when questions or problems
arise. In a recent survey we conducted in conjunction with Greenfield
Online, we discovered that 28 percent of online shoppers abandon their
carts because they cannot get enough information about a product, another
28 percent leave the Web site because of an unclear checkout process, and
13 percent of customers are lost due to the inability to speak with a
According to Datamonitor PLC, however, only an estimated three percent
of all e-commerce Web sites have live interaction available to customers.
Datamonitor also estimates that e-commerce companies could lose more than
$6.1 billion in sales this year because they are not sufficiently
addressing customer support.
Locking In The Customer Relationship: The Benefits Of Live
There are three areas where real-time interaction over the Internet is
playing out: voice over IP, co-navigation and live chat. Live chat is
receiving the most attention at this stage because the technology is
readily available, the benefits are significant and customer demand for
live chat is surging.
As an application, live chat is similar in look and feel to America
Online instant messaging. Via a pop-up window, a customer can communicate
back and forth with the live chat operator. The live chat operator can
send back or "push" text, images and URLs to the customer.
A Win-Win Proposition
Results from early deployments indicate that live chat has a
significant bottom-line impact. A win-win proposition for e-tailers and
consumers, the implementation of live interaction on shopping Web sites
allows e-tailers to maximize sales opportunities, reduce operating costs
and strengthen customer relationships; all while providing the type of
customer service that Internet shoppers are seeking.
Live chat also boosts productivity. CSRs are able to maximize the
quality of the interaction and the time spent with each customer.
Typically, CSRs can handle up to four customers in chat sessions, reducing
the cost per interaction when compared to a typical toll-free call. In
addition, customizable preformatted responses can help the CSR improve
productivity and ensure consistency to frequently asked questions.
Moreover, the lower cost of trans "Live Interaction"
continued from previous page mitting information via the Internet or
e-mail versus placing a phone call further increases the cost benefits of
other customer interaction channels. GartnerGroup estimates that when
"Amy" calls you and actually gets through, the interaction costs
an average of $5.01. By contrast, if a company were able to handle a
"conversation" through a Web chat session, the cost ranges from
only $0.25 to $3.50.
There's a lot of lip service being paid to the concept of one-to-one
marketing. Everyone wants to do it. Everyone recognizes it's important.
But most make the mistake of thinking technology alone is going to deliver
the promise. It takes the impact of a live person to build relationships
With live chat, CSRs can interact with customers in real-time. They can
market to those customers on a one-to-one basis. They can receive
real-time feedback about customer service and technical support efforts.
They can review archived call logs to access a customer's call history and
gauge customer satisfaction levels.
Deploying A Solution: Choices Facing E-Businesses
The solutions to help provide customers with multichannel support are
available. The question then becomes, how does an e-commerce company
deploy a solution? What's the best strategy? How does a company get from A
to B and do it cost-effectively?
Building in-house is attractive because control and customization are
seemingly maximized. But building in-house is expensive, time-prohibitive
and perhaps even indulgent, particularly for an e-commerce company that
wants to be responsive to its shareholders. Building in-house also
requires extensive project management resources.
Application service providers (ASPs) offer an alternative solution that
is becoming increasingly attractive to e-commerce providers.
ASPs essentially "rent" applications to an enterprise,
usually on a monthly fee basis. ASPs are especially appealing to small and
medium-sized companies that want to sidestep the problems and costs
associated with managing their own systems. With an ASP, an enterprise can
often reduce IT staffing and immediately access proven technology while
speeding time-to-market with new applications and maintaining costs.
Increasing numbers of e-commerce companies are turning to ASPs to
improve their overall customer service offering. According to IDC, the
customer relationship management (CRM) service market will grow from $34.4
billion in 1999 to $125.2 billion in 2004 -- double the growth of the
overall IT services market. The CRM market's biggest sector is
outsourcing/operations management, which comprised 67 percent of the
market in 1999.
ASPs are the ideal providers of customer service technologies for a
number of key reasons:
Improved time-to-market. E-commerce providers need to be able to
adjust their service offering quickly if they spot an opportunity. ASPs,
with their pre-existing relationships with major software providers, can
help them move faster.
Flexibility in product and service mix. ASPs are ideally suited
to provide a full range of customer service technologies. E-commerce
companies should look to providers that can meet their particular needs.
Access to next-generation technologies. ASPs enable e-commerce
companies to offer cutting-edge technology at a lower cost. The best
essentially offer "applications on tap."
Lower costs. Deploying enterprise systems is expensive. It
requires extensive internal project management resources. Set-up and
monthly fees for ASPs range in the low thousands versus the million-dollar
price tags for enterprise systems.
The Bottom Line
Behind every great e-business, there is a thrilled customer. This
customer is loyal; he or she comes back again and again. This customer is
profitable. This customer is also very rare in today's e-marketplace.
By ex-tending the length and quality of a customer's visit, live chat
technology helps increase conversion rates, average order size and
customer retention. Equipped with live chat, a CSR can also turn an
abandoned shopping cart into a sales opportunity by essentially instant
messaging a customer and asking if help is needed. Only by embracing their
customers online can Web site owners expect customer retention and
Larry Wasserman is vice president of marketing at LivePerson,
an application service provider (ASP) of technology facilitating real-time
sales and customer service for companies doing business on the Internet.
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