Over the past year, there have been some studies completed to determine the impact of using live chat to increase conversion and average order value. Some marketers believe that providing answers to questions (via live chat) at critical stages during the purchase process can help increase your conversion rate. In a nutshell, it’s about proactively helping customers overcome barriers so they can make a purchase. A case study that comes to mind is the CompUSA Coremetrics study that showed a 10X increase in conversion when using live chat. That’s a powerful statistic, don’t you think? Let’s take a look at what happened to me the other day…
A Little Upgrade Assistance Please…
A few days ago I sat down to order a software upgrade, and before I knew it, I became part of my own case study! I was ready to place an order (literally having all of my contact and payment information entered) and then I remembered seeing a new upgrade version while quickly clicking through the website. I didn’t want to spend too much time, so I just added the version I knew that I wanted to my cart and started the checkout process. As I was entering my credit card information, a little voice in my head kept telling me to check the other upgrade version just in case… I didn’t want to lose all of the information that I just entered, so I clicked the live chat button (located prominently in the upper right-hand corner of the checkout page template.) I didn’t plan to use live chat during this online purchase…I just didn’t have a lot of time and didn’t want to re-enter my contact and payment information. I was ready to just place my original order when I clicked live chat.
Charles Helping Glenn…or Glenn Helping Charles…
Here is the transcript of my live chat session so you can see how it unfolded. I provide a short analysis of this chat following the transcript. Note, when I clicked the live chat button, I had $375 of software in my cart. Also, the name of the live chat rep and the company have been changed to protect everyone involved. :-)
The Live Chat Transcript:
Please hold as we route your chat to a representative.
Welcome! My name is Charles. May I assist you with your selection today?
Glenn: Hi Charles. I have a quick question.
Glenn: I am upgrading a software package and noticed a new upgrade version available on the website.
Glenn: It looked interesting, so I want to know if I qualify for the new upgrade version.
Glenn: I do own the software packages required for the upgrade, so I’m hoping your answer is yes. :)
Charles: It would be my pleasure to help you with this.
Glenn: How much is the new upgrade version again?
Charles: I’m glad to let you know that you can upgrade to the new version for $1250.
Glenn: Charles, I thought it was closer to $500
Charles: I’m sorry. It will cost you $650 for the current upgrade you have in your cart and $1250 for the new upgrade version.
Glenn: That’s weird; I’m seeing an upgrade price of $375 for the current version since I already own the previous version and then ~$500 for the new upgrade version.
Charles: If you have previous versions of the software package, you can receive the new upgrade version for $475.
Glenn: OK, I got it…that’s what I thought I saw earlier.
Glenn: So, it’s $475 for the latest version of the upgrade? I just want to make sure.
Charles: If you have the most recent version of the software, you can definitely get the latest upgrade version for $475 and the one that’s already in your cart for $375.
Charles: Are you ready to place the order?
Glenn: I’m going to think about it for a second. It sounds good, though. Thanks for your help. I appreciate it
Charles: You’re welcome.
Glenn: I’m about to add the new upgrade version to my cart but I’m still a little confused with the language on the upgrade eligibility form. Again, I just want to make sure I’m eligible for the $475 upgrade.
Glenn: It’s definitely $475 for the latest upgrade version, right?
Charles: Yes, you are correct.
Glenn: Cool, purchasing now…
Glenn: Thanks for your help Charles. The new upgrade version seems like a really good deal.
Charles: You’re welcome Glenn, is there anything else I can help you with?
Glenn: No, I’m good to go. I’m downloading the upgrade now…and will be using it shortly. :)
Glenn: Happy New Year!
Charles: Thank you for your purchase today!
My Live Chat Analysis
To clarify, I ended up spending $475 versus $375, but for an upgrade that definitely made more sense for me than my original order. So, have you ever been in a situation like this? You know, where you are sitting on a website debating whether or not to buy something or trying to decide which version of the product to buy. To me, this is where live chat is a killer application for e-commerce sites. Charles (more on him below), definitely helped clarify the latest upgrade, if I was eligible, and waited to ensure the order went through. Charles also generated an additional $100 for the order. So, I ended up a happy customer and the software company ended up just as happy (and with more revenue!) :)
The Live Chat Challenge for Marketers
If you read the transcript carefully, then the challenges you face while implementing live chat are glaringly obvious. In the beginning of the chat, I actually knew more about the upgrade pricing than Charles did. I could have easily taken his word and proceeded with my original order… If you choose to implement live chat on your website, you’ll need to ensure your reps are extremely knowledgeable about your products, pricing, upgrades, and promotions. If not, you’ll end up looking foolish and missing opportunities to increase conversion and your average order value. Heck, you could even lose customers by decreasing the credibility you built up prior to the live chat session. Remember, the point of using live chat in e-commerce is to help visitors overcome barriers so they can move forward with their purchase… Like many things in this world, the very thing that can help you can also hurt you if it’s not used properly.
In closing, I’m a believer in any application that can help you increase conversion or your average order value while also making your customers happy. And it really hits home when it happens to you! Think about this…if Charles and his coworkers can achieve the same result 10 times per day in a 200 day work year, then they could generate an additional $200,000 in revenue for their company.
($100 increase in order value x 10 orders per day x 200 days in the work year = $200,000)
Now think about your business…do you believe that live chat can help you increase revenue while also making your customers happy? It just might be worth a try, right? Just make sure your “Charles” knows your products inside and out! :-)