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The Problem With Live Chat That Vendors Don’t Talk About
By
 — April 16, 2021

Live chat is quickly becoming a mainstay in the direct-to-consumer (DTC) retailer playbook, and it’s easy to see why. Chatting with shoppers in real-time has an undeniable allure: it helps retailers extend their in-store service to their online store, offer immediate customer support, and convert more website visitors into sales. 

But there’s a problem that live chat vendors don’t talk about: on its own, live chat it isn’t scalable

If chat requests are too high and store associates can’t respond quickly, shoppers wait — and when it comes to live chat, speed is critical to success. The faster a shopper is served, the more likely they are to make a purchase. In fact, Shopify BFCM data found that when businesses respond to shoppers within 5 minutes or less, they’re 70% more likely to buy something. 

When businesses respond to shoppers within 5 minutes or less, they’re 70% more likely to buy something. 

And while live chat promises to help retailers do just that, that promise tends to break when store associates need to serve a high volume of customers. 

Let’s explore why live chat alone won’t help retail teams serve customers faster at scale, how to fix that problem and reap the benefits of one-to-one virtual customer service. 

But before we get into that, let’s cover the basics. 

What is live chat for retail? 

Live chat is an online messaging service that lets shoppers talk with store associates or support agents in real-time via a messaging channel like Facebook Messenger, WhatsApp, Instagram, or a brand’s web chat. 

With live chat, retailers can have text-based conversations with their customers. Retailers embed live chat software onto their website and social media pages, and customers can chat and get real-time service from either a human (live chat) or virtual assistant (a chatbot).

And while live chat is typically thought of as a tool for customer support, it can also be used to make sales. 

Heyday, for instance, has a live chat feature that connects shoppers with store associates for real-time service (say, to help them find a product), an AI chatbot component that resolves straightforward, repetitive requests (like helping shoppers track their order), and conversation routing that sends more complicated support requests to a human support agent for more personalized service. 

Basically, any time you’re chatting with a real person who works for a brand — whether you’re looking to buy something or get customer support — that’s live chat. 

How does live chat work? 

Live chat world by connecting to your eCommerce platform (Shopify, Salesforce Commerce Cloud, Magento, etc). Once it’s connected, whenever a shopper visits your website, a chat widget appears and asks them if they’d like to get service via chat. 

DAVIDsTEA’s live chat, powered by Heyday, lets shoppers get real time service, find products, or get immediate customer support.

An AI chatbot asks the shopper discovery questions (like “how may I help you today?”). Depending on the answer, the chatbot will either recommend the shopper products automatically, respond to the FAQ, or connect the shopper with a human for more personalized service.

While the AI chatbot resolves the majority of incoming chat requests, a retailer’s human teams can give one-to-one service to the shoppers with more complex needs. 

Live chat for customer support

One of the most popular use cases for live chat is to allow customers to get in touch with human support teams instantly. When compared to phone support or email, live chat has one main advantage: communication is theoretically instant.

That instant feedback is why live chat leads to greater customer satisfaction when compared to more traditional support channels. In fact, live chat boasts a 73% customer satisfaction (CSAT) rate, while email comes in at 61%, and phone clocking in at 44%. 

Live chat for sales 

Another use case for live chat is for distance selling — that is, when store associates connect with online shoppers, offering advice, recommend products and closing sales just like they would in a store. 

If, like for many merchants, in-store foot traffic is lower as a result of COVID-19 shutdowns, brands can re-deploy their sales associates online and start serving online shoppers instead.
Oberson’s live chat connects shoppers with store associates, who can recommend products relevant to what the shopper is looking for.

If, like for many merchants, in-store foot traffic is lower as a result of COVID-19 shutdowns, brands can re-deploy their sales associates online and start serving online shoppers instead. It’s an excellent way to proactively maximize sales on the channels where shoppers are. 

What are the benefits of live chat? 

The theoretical advantages of live chat compared to traditional support channels (like email or the phone) can be bucketed into a few categories: 

  • Quicker response times
  • Greater conversion rates 
  • Customers love it

Faster responses means better CSAT scores 

The speed in which teams respond to a customer’s live chat request is critical to customer satisfaction. In fact, Arise suggests that 80% of customers expect a response within 24 hours, 37% within an hour, and 16% expect an instant response. 

The premise of live chat is simple: faster response times equals more satisfied customers. So, in theory, live chat results in greater CSAT scores. While that’s an interesting theory, the reality is more nuanced. 

What happens if there’s huge demand for live chat from shoppers? A backlog develops, support teams first response times drop, and CSAT scores suffer as a result. But most support requests can be solved by automated responses. 

While an AI chatbot instantly resolves straightforward support requests, support teams can focus exclusively on solving more complex issues via live chat. 

Based on a chatbot study of over 1,000,000 conversations, three support questions account for 75% of all support requests: Order tracking, returns and refunds, and store location and hours. 

This is where an AI chatbot that automatically resolves FAQs comes in handy. While it instantly resolves straightforward support requests, support teams can focus exclusively on solving more complex issues via live chat. 

While the premise of live chat support is certainly valuable, a layer of automation helps retailers keep first response times as low as possible, resulting in greater CSAT scores.

Automation helps live chat live up to its promise of increasing customer satisfaction.

Live chat helps merchants sell more online 

Shopify found an interesting correlation between quick response times and a shopper’s probability of buying something via chat — if they were served within 5 minutes, shoppers were 70% more likely to buy a product. 

Popeye’s Supplements, for example, turned to live chat to extend their specialized service online at the outset of COVID-19. 

We are a highly specialized product, so our consumer needs to be sold on our service and feel the value of what we bring to the table,” Philippe-Antoine Defoy, a franchise owner of Popeye’s in Quebec, explains.

“We have a lot of teams at the store level who interact with clients one-on-one, but as people began relying more on online shopping, we had to figure out how to replicate the in-store experience to ensure the same level of communication.”

With a chatbot resolving frequently asked questions, Popeye’s human team spent their time serving online shoppers who needed their expertise. 

“Before, people would send us messages (online) and they would often go unanswered. There were just too many to handle quickly. With the chatbot, though, we can provide instant responses and also manage expectations in regards to when they can speak to a human agent via live chat.”

Speed is key to converting more conversations into sales. And when merchants blend the power of live chat with AI-powered automation, they can manage expectations, serve customers faster, and generate more sales via chat. 

Retail in 2021 will combine the best of human and automated services — the beginning of a truly ‘bionic’ customer experience.

Shoppers voted live chat as their preferred channel

If you needed to talk to customer service, which channel would you choose? As it turns out, most shoppers around the world prefer talking to a business via messaging platforms. 

Image source: Neil Patel 

With Heyday, shoppers can reach brands across any messaging channel, whether it’s web chat, Facebook Messenger, WhatsApp, Instagram Direct Messenger, Google Business Messages. 

And this is where the benefits of  automation and live chat working together really shine. Retailers can open up chat across every channel, automatically resolve the majority of incoming conversations, and also give shoppers the opportunity to talk to sales associates through live chat. 

Whether they need an answer to a simple question like “where’s my order?” or have a complex question that needs to be answered by a human, a blend of automation and live chat helps retailers serve their customers in a way that’s convenient to them. 

What are the drawbacks of live chat? 

The main drawback of live chat is that it’s challenging to scale without growing human teams. 

For a shopper to get in touch with a store associate fast, one needs to be available. But what happens when you have more customers using live chat than you have agents to support that demand? 

Your customers wait, and the benefit of live chat (fast, one-to-one service) is lost. Without automation, live chat simply doesn’t live up to its expectations. Human teams have issues answering high volumes of customers quickly. 

Without automation, live chat simply doesn’t live up to its expectations. Human teams have issues answering high volumes of customers quickly. 

Unless you’re comfortable scaling your human teams to support live chat requests as they grow (and growing your labor expenses as well), it’s likely that a messaging platform that has both an AI-chatbot and live chat is the answer.

Live chat and automation: a bionic customer experience 

While the benefits of live chat are definitely real, what we’re seeing is that it needs the help of automation to reach its full potential. When you combine both, the results can be tremendous — and it benefits both shoppers and retailers. 

For shoppers, they benefit from instant service for simple FAQs, and near instant responses for more complicated queries via live chat. Merchants benefit from smaller backlogs of incoming requests, and higher customer satisfaction scores (CSAT). 

A McKinsey study states that “Retail in 2021 will combine the best of human and automated services — the beginning of a truly ‘bionic’ customer experience.” And in this context, it seems as though AI-powered chatbots are a strong, if not necessary, compliment to live chat.

Interested in learning how to scale your online customer service with Heyday AI’s unique blend of automation and live chat? Get in touch with our team of experts today!

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