Is live chat really what you want for your business?

Live chat is one of those things that, in theory, makes a lot of sense. It makes it possible to provide instant customer care at the very moment that your visitors get into trouble or have questions. In theory, that’s amazing. Whenever a visitor has a problem, they’ll just fire up a chat and they can get answers immediately. Awesome!

And more and more people are getting used to and using it. Data shows that over the last five years, the number of online shoppers who have used live chat for customer care has increased from 38% to 58%.

Plus data from ZendDesk’ Benchmark Report found that live chat has the highest customer satisfaction rating of all — 92%. That’s better than voice (telephone), email, web forms, Facebook, and Twitter.

Screenshot via Zendesk

When we start looking at case studies from companies that are using live chat, things get a little more complicated. There are many companies that have found live chat to be great tool for sales conversions — visitors get their questions answered and therefore are more likely to buy. Makes sense.

On the flip side, there are examples of companies that found that having live chat actually decreased signups and sales. However, most people would say that, when it’s used correctly, live chat helps to convert.

How Ez Texting used live chat to increase signups

Ez Texting provides web-based text messaging service and to serve their customers better, they decided to implement live chat. To be sure that it would bring actual value, the decision was made to run an A/B test just be sure that it’s delivering results.

They displayed the live chat widget only on the sign-up page so that when a user has any doubts before signing up, they could ask questions from a customer service rep directly.

After running the test, the results showed that having the live chat widget increased sign-ups by 31%.

1-0 for live chat.

Full Case Study: Live Chat widget increases signups by 31%

And Virgin Atlantic used live chat to increase average order value by 15%

Virgin Atlantic, on the other hand, went a bit different route when they implemented live chat. Instead of doing it at the end of the funnel like Ez Texting did, they decided to use it to bring in incremental revenue by increasing average order value.

Among other things, they used it to promote specific flights that the company wanted to prioritize for bookings by offering chat invitations to visitors browsing those flights.

In the end, they found that using those tactics via live chat lead to “conversion rates reach as high as 23% for consumers who use its proactive live chat” which is ~3.5 half times their normal conversion rate. Additionally, their average order value was found to be 15% higher.

This just goes to show that there is more than one way that live chat can be useful.

2-0 live chat.

Full Case Study: Virgin soars on customer service via live chat

… While Kissmetrics lost customers

Image via Lars Lofgren

Kissmetrics had been running live chat on their pricing page for a number of months before it was decided that it should be used site-wide. Because the one on the pricing page was implemented with no prior testing, they wanted to get some actual usable data before implementing it everywhere.

The results showed that signups from the variation with live chat decreased 8.59% at 81.38% statistical significance and, more importantly, activations decreased by 22.14%.

The drop in signups would have been fine as long as the quality (a.k.a activations) increased. If anything, live chat decreased signups and the quality of people who did manage to create an account.

Does this mean that live chat is bad and should never be used? No. So it’s good and should always be used? Also no.

All this shows is that there aren’t any real “best practices” when it comes live chat. It depends on your specific business and how you implement and execute things. It definitely can work, but is not guaranteed to work.

Full Case Study: How Live Chat Tools Impact Conversions and Why I Launched a Bad Variant

Image via Lars Lofgren

Tips & tricks

As previously stated, live chat does not guarantee higher conversions. Still, if you know what you’re doing and why you’re doing it, it’s possible to find success. To help you out with this, here are some tips & tricks for successfully running live chat:

  1. Invitation To Chat
    A proactive message of “How can I help you?” popping up on the right-hand side the moment a visitor arrives can be seen as intrusive. Or not. Experiment with different “invitations” and timings of showing it (if at all).
  2. Response Speed
    Potential customers like live chat because it’s a quick way to get questions answered. When they have to wait several minutes to get a response, they’re more likely to leave. Sure, research shows that this can be mitigated by attentive customer care, but I’ve never heard anyone say that the customer service rep replied too fast. That’s never an issue.
  3. Channel Switching
    Live chat is primarily meant for short conversations and specific questions. When the question asked requires longer investigation or complicated steps, don’t be afraid to change the channel of communication to one that makes the most sense in the given situation.
  4. Opening Hours
    It’s common to have live chat activated during the traditional office hours of 9-5, but is this the time that your customers are actually online? The point of live chat is to help potential customers out, you can’t do that when “live chat” is not actually live. Look at your traffic and figure out times when it’s most likely that visitors will have questions. Also, having extra people around to help out during peak traffic hours is not a bad idea.
  5. Competent Reps
    A lot of live chats ability to positively move the needle depends on having competent live chat reps who know the product(s) and systems well and are good communicators. A good place to start is by making sure that reps get properly and thoroughly trained.
  6. Call Center Rep ≠ Live Chat Rep
    Live chat is a form of written communication. Writing skills have very little overlap with those of call center reps. You probably should have open communication lines between call center and live chat reps, after all, call center reps know their stuff and can help live chat people, but communicating directly via live chat? Bad idea.
  7. Customer Feedback Gold
    Put simply, live chat is customer feedback gold. By looking at what visitors are asking about the most, you can make changes to your design and copy that would mitigate those concerns. It could be that a specific product or feature of a product gets asked a lot questions? Whatever it is, all of it can be useful.
  8. Test, Test, Test
    Never stop testing live chat. If having a proactive chat widget (automatically pops up) is not working, try a reactive one. Test different opening statements, different fields on the chat windows etc, etc.

Final thoughts

When done right, live chat can make a significant contribution to your bottom line. But you need to remember, that it’s not as simple as installing a widget and hoping for the best. You need competent people running the show behind the scenes and to be online at the times that your customers are.

There is very little in the way of “best practices” for live chat. A lot of this is testing and experimentation. Like with almost everything else, it can work but is not guaranteed to work.

Ott Niggulis
Ott Niggulis is a freelance writer who focuses on business, marketing and CRO. Marketing is a numbers game, and he loves numbers.
Showing 4 comments
  • Ian

    What are the best recommendations for Live Chat?
    I see none of the top chats (Drift, Intercom) have segmentation that links to Shopify data. Would Klaviyo build something like that? A Live chat,with Klaviyo’s integrations in it?

  • Brian Neville-O'Neill

    Hey, Ian. That’s an interesting question! Klaviyo doesn’t currently have plans to offer a live chat feature but it’s an interesting idea (you could say that our Product Team has made a note).

  • Peter

    I don’t quite understand why Kissmetrics encountered dips in conversion and activation rates. Is there a particular reason why Live Chat could lead to lower conversions/activations?

    • Ott Niggulis

      There could be many possible reasons for it. It could have been that the copy on the live-chat prompt was too generic and turned off users or it could have to do with timing of the live chat prompt or many other factors.

      In the the original case study the author brings out these and several other possibilities for why it didn’t work, but then adds that because of time constraints the company didn’t have time to fully investigate it. The point that the case study (and the article) is trying to make is that live chat could work, but there are things that you must consider before implementing it. It’s not a simple plug-n-play plugin.

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