Published on 3 January 2013
Guest Post by Pascal van Opzeeland, Marketing Manager at Userlike.
Even though live chat is steadily increasing its presence throughout the web, most of the online businesses we've talked to are unsure about the payoff of its implementation and what solution they should try out.
Acknowledging that the potential benefits, the required investment in human resources, and the amount of different providers on the markets, are factors that complicate the manager's choice.
The benefits promised by live chat software providers include a greater customer satisfaction, higher customer loyalty, a higher conversion rate, and lower service costs. But will these benefits also work out for your business? And what type of software should you try?
The goals of this post are (1) to help you understand the main differences between live chat providers, and (2) to help you decide whether live chat is worth the investment of money and time for your business.
Live chat has been around for approximately 10 years and during this time a number of significant variations have evolved. These can be categorized in the following ways:
Download or SaaS
The first live chat providers were all download solutions, which means that businesses had to host the software on their own servers. As with most app segments, the advance of the Cloud has had a considerable impact, pushing forward new software-as-a-service (SaaS) players among the live chat providers.
Both variations have their merits. Some companies don't want their customer interactions to take place on servers that are not their own. For these companies a download solution would be optimal.
The advantage of the software-as-a-service providers is that your servers won't be burdened, ensuring optimal speed and the well functioning of the chat system during peak times in traffic.
Finally, the two types of solutions tend to differ somewhat in their visual outlay. If a visitor starts a chat on a website that has the average download solution installed, a new window pops up in which the chat conversation takes place.
On the other hand, the chat window of a SaaS solution is typically integrated into the webpage. When a chat is started the window slides over the page and moves with the visitor as he navigates the site.
Which one is preferable is largely a matter of taste, but the mean reason for the new providers to step away from the separate window version is that the view gets lost as the visitor clicks to other pages, creating frustrations and making it impossible to effectively offer support throughout the whole website experience.
Over the years the SaaS solutions have become more dominant.
Broad or Specialized
Another categorization can be made between broad and specialized providers. There are live chat providers from whom live chat is merely one element of their total offering. With these providers one receives a full CRM solution, which could exist out of a helpdesk software, email software, etc.
On the other hand are the specialized live chat providers, which take on a more modular approach. Instead of offering the 'full package', these providers focus only on live chat and offer the possibility to integrate with other business tools. This can happen either through their standard integrations with popular platforms (e.g. Zendesk, Desk.com), or through the open API that some providers offer.
Examples of Live Chat Sofwtare
Now that we've covered the different categories of live chat providers out there, how do you know whether live chat is interesting for your business?
Through a research we've conducted among 200 of Userlike customers we set to find out for what type of websites live chat carried the highest value.
Through questioning the different types of customers we've come to the following three properties of an online business that decide whether live chat is worth the investment:
I. The Complexity of Your Products/Service
A general and straightforward rule is that the higher the complexity of the products or services offered, the more questions your website visitors will have before making the step to being a customer. Live chat is a great tool to convince customers of the superiority of your offerings, allowing you to tailor to your visitor's needs. Conversely, if you are selling a very straightforward product, like for example shoelaces, chances are that not so many of your visitors will make us of your chat function.
II. The Profitability of Your Products/Service
A live chat conversation over your site takes devoted time from your human resources. To justify this investment, the product or service you are selling must be profitable enough.
III. Amount of website traffic
Similar to the previous point, the investment of time behind the chat can only be justified with a certain amount of interaction on the site. Service employees can of course easily engage in other activities when there are no chats, but if there is only one chat in so many hours, the investment is hard to justify.
Altogether live chat is a very interesting investment to consider by any business where the website takes on a central role. We hope the categorization and website properties discussed above will allow you to make a more informed decision.
Let us know if you have any experience with live chat and how it's worked out for you!