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October 13, 2022

Tamina Steil

10 Research-Backed Live Chat Benefits for Businesses

When we ask companies why they don't offer chat support, they usually give a variation of the same reply: "We already have phone, email and even social media support. Why would we need live chat?"

In the digital age, competition and buyer empowerment have become stronger than ever . This is fantastic news for consumers because businesses are finally making customer needs and expectations their top priority.

Live chat is an integral part of good customer experience because it allows you to seamlessly connect with your customers in real-time, directly on your website. This unique set of characteristics distinguishes chat from all other contact channels and can positively impact your business’s success.

Let’s take a closer look at the diverse benefits live chat offers for your business, your customers and your service team.

1. Optimize conversions
2. Reduce service costs and boost efficiency
3. Prevent cart abandonment
4. Increase customer satisfaction
5. Personalize your brand
6. Collect customer data
7. Automate service with chatbots
8. Boost agent motivation
9. Track success
10. Gain a competitive advantage

A major reason why so many companies are swearing by live chat is that it’s significantly boosting their sales. Research confirms this positive chat-conversion-relation.

A case study with Virgin Airlines showed a 3.5 times higher conversion rate than with people who had emailed the company. What’s more, they also found that chatters had a 15% higher average order value compared to those who didn't use the chat.

In another case study , electronics store Cyberport reported that visitors who engaged in a chat were almost five times more likely to buy than visitors who hadn’t used the chat.

So what are the reasons for live chat driving sales?

In the 21st century, your website is the storefront of your business. While it’s hard to imagine a physical store without any service personnel there to greet and assist customers, this element was the first to go when businesses entered the digital era.

But to survive in the highly competitive online market, businesses increasingly realize they need to put their customers first again. That includes being available for questions and assisting customers with their purchase.

Although commerce is increasingly happening online, many sales and customer service departments still rely on obsolete contact channels from the last millennium. Aside from customer preferences, which we’ll cover later in this post, this also means that a channel switch is necessary – bad news for your conversions.

Even though email is trying to improve itself with on-site contact forms and opening automatically when you click on an address, it still remains a slow contact channel. If the answer to a customer’s question is critical for making a purchase, they still have to wait for a response or move on to your competitor.

Live chat is the only channel that’s both on-site and real-time. This unique combination allows you to guide visitors on your website and solve questions crucial for buying directly, before they put customers off the purchase.

If you rented a billboard in Times Square, asked Keanu Reeves to star in your TV spot and ran the print ad in the New York Times, you might increase your conversions. But you’d likely just end up bankrupt because the raise in sales couldn’t cover the investment costs.

Conversion rate is an important business KPI , but to be profitable, you need to take factors such as efficiency into account as well.

Live chat hits that sweet spot because it brings in more money and saves you a lot.

A Forrester study suggests that a live chat session is about 20% - 50% cheaper than a phone call. There’s a few reasons for this cost reduction:

• Quicker resolution times
• Smart routing modes that reduce time-consuming misconnects and redirect visitors to the right agent
• Being able to support multiple customers at the same time with useful features like canned messages

Consumers are promiscuous. They feel no shame swiping your business to the left in the blink of an eye. The checkout process looks too complicated? Shipping costs are unclear?

Thank you, next.

Consequently, cart abandonment is one of the biggest challenges online businesses face, with global average rates of almost 80% . According to the Baymard Institute, high extra costs are the top reason why consumers leave their cart before completing their purchase.

Source: Barilliance

When shipping costs or delivery times vary, e.g. by country or product category, customers get stuck combing the internet for an answer and may second guess their purchase.

By adding live chat to your website, you take away all uncertainty. It shows you’re there to answer questions that may arise in the checkout process. Transparency is a key factor for building trust in online businesses.

Not every customer wants help, of course. The “I’m just browsing” type of customer not only exists in real-life but has found their most convenient habitat in the online world where no one talks them into buying.

Or can you? Approach website visitors that have shown interest in your products by starting a proactive chat session with them. This allows you to achieve what good sales people can in physical stores: create desires and nudge people to buy. If you’re running a limited offer, for example, you could use the chat to let your site visitor know about it.

Advanced chat solutions like Userlike give you even more power. If you connect your tracking tool to live chat, you’ll have crucial data at your fingertips throughout the customer journey. This allows you to precisely target customers based on their interests and stage in the funnel.

Every chat operator can see on which page a customer is at that moment and what they have in their shopping cart. This is highly valuable for us to deliver targeted support and prevent cart abandonment.

Jens Lippert, Cyberport

That all sounds promising from a business perspective. But what do your customers think about chat?

To make it short, live chat is consumer’s sweetheart, scoring customer satisfaction rates of over 90% .

At a closer look, this isn’t too surprising. In the history of customer service, people had to endure constant forwarding and repeating their request to multiple agents or waiting days just to receive an impersonal email response that didn’t even solve their issue. Live chat is the new kid on the block that solves these customer frustrations.

• It’s fast. First and foremost, customers love the convenience of chat. According to Econsultancy, 79% of consumers prefer live chat as a contact channel because they get immediate answers.
• It’s free. Sending and receiving instant chats is always free. Phone hotlines might also deliver (relatively) fast answers, but international calls and having enough agents will cost you big time.
• It’s anonymous. Live chat is the only channel that gives users the option for full anonymity, which boosts acceptance. You can just ask your question without formalities (or grammar) holding you back. With email, your name is often displayed in your email address and with phone, speaking with someone can feel quite intimate even without sharing your name.
• It’s inclusive. Unfortunately, people still experience discrimination in business situations because of their gender, race, age or disability. The anonymity of chat strips these traits away and puts the customer into focus. Insurance company LVM states that live chat established an inclusive service environment that gives hearing-impaired customers an accessible way to get in touch with their service team.
• It’s conversational. Millennials seem to be glued to their phones but show a morbid fear for its original functionality: to call someone. And it’s not just this demographic, the use of messenger apps in private communication has radically changed how we all talk to each other. Live chat brings consumers’ preferred mode of communication to your website .
• It’s multimedia friendly. People love texting but it’s not always ideal to explain an issue in chat. Live chat features like file sharing and media support empower customers to choose any format to express themselves without requiring a channel switch. Instead of typing in their long account number, for example, they could just take a photo of their membership card and share it with the agent.

Live chat improves your customer experience because it brings a seamless, hassle-free contact channel to your website.

Getting closer to customers is on everyone’s agenda, but it’s easier said than done when there’s a thick layer of cyberspace separating you from them.

Live chat helps you break this mold and build long-term relationships with your customers.

Your service team is at the customer frontline. Embrace this opportunity to put a face to your brand through live chat. Operator names and images create an immediate, friendly connection. To drive home that branded style, customize the chat window’s design to fit your corporate identity.

“Userlike allows us to bring that personal skate shop experience to our online customers” – Matt Kuncaitis, customer service at Titus

Smart routing modes in live chat automatically connect customers with the agent they’ve chatted with before. This is a win-win situation; your service efficiency increases because the agent is already familiar with the case, and you deepen the customer relationship.

We admit it - sometimes a quick call is better for resolving an issue. With Userlike, you can meet your customers face-to-face without leaving the chat. With one click, agents can start a video call in a new window on desktop or mobile.

Video calls are personal, like FaceTiming with a friend. This will help the customer associate a real person with your business and add warmth to your brand.

Data is the most desired commodity in the digital era. Live chat makes it simple to gather relevant customer information such as their name, email address or location.

Build in-depth customer profiles and stop targeting your customers with a shotgun approach and appeal to them precisely instead. For example, having the customer’s location at hand helps you answer whether you ship to their area or have a store nearby in no time.

You can also use the contact database to re-engage your customers after the chat session has ended. For example, to inform them of a special offer or update on their contract.

Another benefit of live chat is that it can easily be integrated into your tech stack. Just extract the customer data from your chat solution and import it to another business tool. For example, turn chats into deals in your Lime CRM so your sales team can follow up with the lead.

Customer data is insightful for businesses, but with the emergence of customer messaging, it’s all too easy to exploit. Turn your live chat into privacy mode with one click and prevent collecting any customer data that they didn't explicitly provide.

Read more about Userlike’s data security setup that data privacy conscious German businesses trust here.

“Where’s my order?” “What are your shipping costs?” “How can I reset my password?”

I’m sure there’s a lot of questions that your customers ask. All. The. Time. Chatbots excel at answering frequently asked questions and happily take over the repetitive parts in customer service.

Our study found that 65% of the respondents prefer speaking with chatbots if it helps them get a fast answer.

When given the choice, a consumer would rather speak to a chatbot directly to solve an issue than wait for an available agent.

It’s a double win. You save costs and customers get the immediate response they’re looking for.

With Userlike, you can use our Logic Bot to create your own rule-based chatbot or take advantage of our self-service AI. That way, you’re able to implement a setup where all chats first go to the chatbot. For more complex requests, a handover to a human agent is possible at any time in chat.

From what we’ve discussed above, live chat offers plenty of benefits from a business and customer perspective. But how do the people who staff the chat feel about it?

Working in customer service can be a demanding and stressful job. That’s why your support team might not get overly excited when they’re told to cover another channel as well. But live chat usually turns people from skeptics into fans, fast.

At first, some of our agents were nervous about handling the chat and replying fast enough. But those worries quickly faded because the chat system is intuitive and fun to use. They now love working with this new medium.

Florian Störk, Division Manager at Volksbank Direkt

More personal. The ticket-in-ticket-out approach of traditional customer service isn’t only dehumanizing for your customers – your support team is sitting in the same boat. Live chat is by nature a more fun, informal communication channel. That makes a support interaction feel more like a personal conversation than a robotic task.

The first thing they write is ‘Hey Matt!’. I don’t know, that just feels so much different than ‘Hello Titus.’

Matt Kuncaitis, customer service at Titus

Instant feedback. It’s motivating to see you’re making a difference for a customer. In contrast to phone and email, you can easily embed survey forms into the chat. They’re non-intrusive and simple so customers are more willing to show their appreciation for good service and leave a rating.

Customers are also more willing to rate the service in live chat compared to other channels. This feedback is highly valuable because it gives you a direct line to what your customers are thinking and how you could improve your service and product to their liking.

Prevents fatigue. Writing isn’t as tiring as talking on the phone all day, especially if you’re dealing with angry customers . Chat agents can also boost their responsiveness while saving effort with canned messages . The work divide between chatbots and agents stimulates motivation because it allows agents to focus on the more interesting, demanding tasks instead of getting lost in the repetitive parts of the support process.

Studies show that moods and emotions can be contagious . That’s why your team happiness is so important for your business success. Happier service agents lead to happier customers :)

In a data-driven environment, it’s important to measure the success of a new software. Every business is different, so the points mentioned here might not all apply to your use case as well.

Live chat solutions come with built-in analytics that make it easy to track the KPIs that matter most for you, for example your agents’ first response time, the chat volume or customer satisfaction scores. For more advanced tracking, it’s also possible to connect your external tracking tool.

Learn more about the live chat KPIs we find most relevant in this post.

As we’ve seen above, customers quickly leave your website when they can’t find what they were looking for, or if the process is too complicated. There’s no space for bad service anymore and live chat is a powerful solution to ultimately improve your customer experience.

Userlike: Instant chats, long-term customer relationships

Over 10,000 companies like Toyota and Hermes trust Userlike to connect with their customers every day - via website chat, WhatsApp, chatbots and more.

Learn more

Although live chat almost seems like a standard these days, many companies still haven’t adopted this customer-friendly approach. It’s shocking how in a developed economy such as Germany, businesses are still using fax machines in support despite it not meeting data privacy standards.

If you’re not catering to end consumers but other businesses, the market is even less established in the digital sphere, with B2B lagging behind B2C in terms of customer experience.

In the highly competitive online market, small distinctions can have a major impact. According to Gartner research , customer experience serves as a primary competitive advantage. Live chat gives you the chance to close the deals your competitors are leaving on the table.

What’s more, a defining trait of digital commerce is that markets are much more connected globally. While you can attract a global audience to your website, supporting them is a different story when you don’t speak their language. Live chat features like auto translations removes language barriers and helps you offer multilingual support.

We're an internationally recognized school with a diverse student base. Chatting is much more comfortable for non-native speakers than having to talk to someone on the phone.

Florian Fürst, Frankfurt School of Finance

Another benefit of live chat: it works for all types of businesses. From the small startup to the family-run medium-sized business and up to the large-scale corporation .

Because live chat is browser-based, you don’t need to install any software and can get started within minutes. Start your 14-day free trial with Userlike today and meet your customers on their favorite channel.