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ONLINE INTIMACY

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					                                     ONLINE INTIMACY
                           – Developing the Potential of Live Chat –
                                     Author: Lynne Taddeo
                                             2006


    Several converging trends suggest that it is time to begin thinking seriously about live chat as
a crucial component of the customer experience. Consider the following:

       This year, Gartner estimates that 25% of all customer interactions will take place via
        Web-based communications (including email, live chat, web callback, etc.). By 2003,
        Forrester estimates this number at 56%.
       At a time in which customer loyalty continues to elude online merchants, companies are
        finding that "superior online customer service has emerged as a key and - in many cases
        - the only means for businesses to differentiate themselves from the competition." In fact,
        Bizrate reports that consumers cited "quality of customer support [as] the single most
        important factor driving repeat online sales, outstripping factors such as on-time delivery,
        ease of ordering, selection, and even price by healthy margins."
       Many consumers persist in their desire for a human element in the online experience.
        Yankelovich finds that 63 percent of people online say they won't buy anything until there
        is more human interaction involved." And a study by NFO Interactive found that nearly 35
        percent of Internet shoppers said they would purchase a greater volume of products
        online if they could speak with a CSR at the time of their purchasing decision."
       Online chat is a more efficient medium than telephone: 1-800-Flowers reports that chat
        agents can handle four concurrent customers within about six minutes. Telephone
        inquiries average three minutes per call, thus half as efficient.

Thus, at a time when Web-based communications are becoming an ever greater part of the
customer experience, when companies have the power to differentiate themselves by the quality
of their customer service, and when consumers are clambering for a human touch in the online
world, live chat offers an exciting and operationally efficient medium through which companies
can connect with customers.

Corporations are catching on to the potential of live chat. Currently, only 2 out of 130 sites in a
recent study offer live chat as an option. Yet IDC predicts that 70% of large corporations will
install instant messaging software during the next 12 months and Yankee Group states that "live
online interaction is the most frequently cited option among features to be added to corporate
web sites in the next 12 months". Retail sites that have initiated chat and personal shopper
options include Polo.com, NeimanMarcus.com, Nordstrom.com, Ashford.com, Talbots.com,
LandsEnd.com, EddieBauer.com, and REI.com.

Consumers enjoy live chat for the immediacy, intimacy, and convenience it offers. Browsers can
easily obtain complex information from a customer service representative with a few clicks of the
mouse. Our research revealed that many consumers prefer chat to telephone if asking intimate
questions such as querying a retail representative on the cut of a garment or how sizes run. Chat
offers the "immediate gratification" that analysts regard as fundamental to the appeal of the Web.
And at a time when most home users continue to connect to the Internet via their single home
phone line, the ability to communicate with a representative without having to log off the web to
place a phone call is much more convenient. Even for those with multiple phone lines, Broadband
or DSL, chat response times are often faster and far more appealing than the prospect of dialing
a contact center, navigating through a VRU, and waiting for a representative to take one's call.
Moreover, live chat provides representatives the opportunity to build customer relationships with
each interaction by giving customers "what they want, when they want it and how they want it."



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Representatives can immediately push client-driven content directly to the customer's desktop in
a way, which is meaningful, tailored, and compelling.
Yet as with any current communication medium open to today's consumers, companies must
establish service and performance standards to ensure that representatives take advantage of
the relationship-building potential of live chat without bungling the opportunity. In establishing
these standards, keep the following guidelines in mind:

    1. Respond Fast. The Web experience is all about immediacy and consumers unflaggingly
       demonstrate that they hate delays and will go elsewhere if forced to wait too long. Simple
       queries should be answered within 30-60 seconds, while up to 120 seconds of wait time
       is acceptable for customers asking more complex questions. If fully answering the
       customer's question will take longer than two minutes, set the appropriate expectation
       with the user by explaining that you are happy to research their question, but it may take
       up to x minutes to fully address.




    2. Provide meaningful and pertinent information. Live chat provides representatives with
       the opportunity to "wow" their customers with detailed, meaningful, and confidently
       delivered product information. Yet it is equally important to answer the customer's
       question in a concise and relevant manner. Avoid the pratfall of barraging chat customers
       with product information that is ancillary to their original request.




    3. Respect the customer's choice of medium. One of the best practices to emerge this
       year is Eddie Bauer's commitment to let the customer choose which medium they want to
       utilize and to provide superior customer service without attempting to move the customer
       to a more automated and cost-effective channel. I recently engaged with a live chat
       representative who offered to help me find the product I was looking for at a rather high-
       end retailer's site. Anticipating appropriate screens pushed to my desktop, which detailed
       my product options, I was acutely disappointed to be directed to the site's search engine
       for self-service. Customers engage live chat for a reason. They either can't find the
       information they are looking for or require more detailed and tailored assistance. Respect
       their choice of medium and fulfill their needs through the channel they have chosen.




    4. Proper grammar, spelling and courtesies are compulsory. Customers will easily form
       a poor impression of a company whose agents cannot spell or follow the rules of proper
       usage. Although chat is a fast-paced medium, attention to such details is crucial. In
       addition, agents must use proper courtesies such as thanking the customer for their
       interest, etc.




    5. Continually update site FAQs to eliminate redundancy. Web customers generally
       prefer self-service and will answer their own questions if possible. By updating site FAQ's
       to reflect common chat queries, companies can eliminate redundancy and allow chat
       agents to focus on complex inquiries and genuine human personalization.




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    6. Offer live chat to all users. Although chat is a more time-efficient medium than
       telephone, there is a human cost to its usage. For this reason, many sites are considering
       offering live chat only to their most valuable customers. While this strategy may be
       invisible in the short-term, we believe that it will backfire in the long run. With the growing
       ubiquity of instant messaging and the growth of live chat on retail sites, customer
       expectations will rise and consumers will eventually demand live chat. In addition,
       customers are "catching on" to CRM-based personalization efforts, which often result in
       high-net worth customers' calls being answered promptly while "less valuable" customers
       suffer long delays. While similar tools can customize Web-site options to only offer high-
       touch service to the most valuable customers, such tactics are offensive to ordinary
       consumers, jeopardize customer acquisition efforts and damage brand image.




    7. Finally, monitor chat agents' interactions to ensure consistent quality. While
       customers crave a human touch in today's web-based commerce, it is precisely the
       human element of chat that can leave your organization vulnerable to miscues. It is
       advisable to monitor a sample of your chat agents' interactions to assess user-perceived
       speed, ensure consistency to basic protocols (spelling, grammar, courtesy), test product
       knowledge, and gauge responsiveness to customer requests. Third-party assessments
       may be preferable, as they prevent supervisor bias and provide an objective view of how
       your organization is viewed from the outside.

Multi-channel customer service offers companies unprecedented opportunity to develop profitable
and long-term relationships with their customers. Customers who take advantage of multiple
touch points are known to spend more with those organizations - Eddie Bauer reported that the
value of clients utilizing multiple touch points does not increase in a linear fashion, but
exponentially. And at a time when customers seek live human communication to enrich the web
experience, "live chat provides the highest level of customer touch . . . to every Web visitor". By
taking advantage of this medium and practicing the above, companies will be poised to
significantly enrich their overall customer experience, resulting in greater retention and revenue.


Lynne Taddeo is Director of Business Development for Kinesis, a CEM company located in Seattle. The company
offers customized solutions for managing the customer experience. She can be reached by calling 206-285-2900.

Source: http://www.kinesis-cem.com/Insights/online_intimacy.html




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