Is chat ready for the mainstream of customer engagement?

Interacting with customers on a real-time basis through online chat is being acknowledged as a powerful customer management weapon. But is it ready for the mainstream?

By Stuart Lauchlan, news and analysis editor

It's good to talk – said BT at one point. It's also good to chat! Chat is finally being recognised as a potentially very powerful weapon in the arsenal of customer management techniques. Analyst firm Gartner predicts that by the end of 2011, instant messaging (IM) will be the de facto tool for voice, video and text chat with 95% of workers in leading global organisations using it as their primary interface for real-time communications by 2013. The worldwide market for enterprise IM is forecast to grow from $267 million in 2005 to $688 million in 2010.

Chat is a means by which companies can interact with their customers on a more real-time basis. By placing a 'Chat Now' button on web pages customers frequently visit, companies can provide immediate assistance before, during and following the buying process. According to Forrester’s March 2008 report 'The Design of Chat Interactions' customers appreciate the immediacy of chat interactions. When consumers who have used online chat were asked what they liked about chat interactions, half said speed of response - “I was able to speak to someone immediately” - followed by personalisaton - “The information I received from my rep was personalised to my situation”.

“Too many companies sit passively by while prospects on the verge of buying abandon their online shopping carts or applications, potentially never to return,” says Forrester Research vice president and principal analyst, Chip Gliedman. “Smart organisations are evaluating the merits of adding chat and other interactive functions to their websites to better engage the customer and potentially increase sales.

Those findings are backed up by other evidence from customer interaction management firm Talisma, which this month reported that its Talisma Chat product has hit the 10 million chats per month milestone. According to Dan Vetras, president and chief executive officer of Talisma, one of their clients found that prior to their chat interaction, greater than 75% of respondents listed the phone as their preferred contact method. After their chat interaction, more than 70% listed chat as their preferred channel, while the phone fell to 20%. Clearly it's addictive... “Talisma Chat now powers four of the largest commercial chat implementations in the world,” he adds.

Adding value

One UK firm that's taken the plunge is Sky Betting and Gaming which has launched a live chat facility on its websites on Grand National day earlier this year. Customers to the Sky Bet, Sky Poker, Sky Vegas and Sky Bingo websites now receive live, 24 hour assistance by clicking on the 'start a chat' button. The service has already increased the number of interactions with customers by 20%and a 30% reduction in incoming emails.

Collaboration features allow Sky Betting and Gaming agents to push web pages to customers in a live session, for example the latest results of a football match, or co-browse the product websites to help the customer find exactly what they are looking for, such as the latest odds on Big Brother, details of its televised poker tournaments or interactive guides on how to open an account.

“Delivering a first class customer experience is one of our man objectives,” comments Peter Nolan, customer operations director of Sky Betting and Gaming. “All our products are live and we must be able to help our customers at their exact point of need, which is why online chat is ideal. While we have significantly reduced the number of incoming emails, the ease of use and live nature of chat has encouraged customers to become really proactive about contacting us. We’re averaging 300 chat sessions per day, six weeks after going live."

Another chat convert - using eGain - is credit information firm Creditsafe UK which offers live assistance through a variety of means including text chat, phone callback, escorting, and online collaboration for form-filling and other transactions. "We found our agents were spending a disproportionate amount of time dealing with issue-based queries often of a similar nature, and wanted to better allocate our resources,” says Rhydian Perry, CRM director for Creditsafe UK, who added that chat enabled the firm to “direct a large number of telephone queries to the web portal, enabling agents to concentrate on resolving more complex customer enquiries and dedicate more time to adding value to the business."

Customer feedback

Meanwhile, BT has dusted down its old "good to talk” motto and is deploying chat fuctionality from RightNow into its BT Business operations, enabling contact centre agents to serve several customers at a time through simultaneous chat sessions. Agents can respond to commonly asked questions by using ‘hot-keys’, which provide standard answers and can escalate queries to a team of specialist support agents. If a customer has a complex issue, he or she can grant permission to an agent to remotely assist and share the customer’s computer screen for instant incident resolution.

“By adding chat to our existing eservice channels we are offering BT Business Broadband and Email customers a popular way of communicating instantly with us,” says Nick Witte-Vermeulen, online support manager at BT Business. “We can now provide multi-channel support for our Broadband and Email customers, so they can contact us via the channel they are most comfortable with. Initial feedback is very positive and customers comment they prefer it to the phone for certain types of enquiry, because they can multitask better. We also gather feedback on our service via chat, so we can strive to provide a better customer experience offering.”

There's also a customer feedback element to chat that is useful for future planning and gaining customer insight. For example, BT Business intends to track the types of questions asked via chat and then include the most common questions in the self-service area of the BT.com site, which should reduce the number of repetitive questions coming into the contact centre, freeing agents to provide personalised assistance with more complex issues.

So is chat ready for the mainstream of customer engagement? Quite possibly – and the credit crunch might end up helping its cause. “While it is true that chat will add incremental costs to the organisation, blindly deciding to avoid these costs is shortsighted,” advised Forrester's Gliedman. “A total economic impact analysis of interactive chat shows that investment in reactive chat is likely to produce a small positive return on investment of 15%, while an additional investment in proactive chat capabilities will produce an incremental 105% ROI and millions of dollars in positive business benefits in a typical business-to-consumer (B2C) organisation.”