Welcome to the site, can I help you?

Welcome to the site, can I help you?

Mall-style pushy salespeople now chat you up on the Web

By Bob Sullivan MSNBC


July 11 — Ever been annoyed by overeager sales staff at the mall? Well, they’re coming online. Customer service chat firm LivePerson is pushing a technology it calls “proactive chat” that will engage Web site shoppers immediately upon arrival. While analysts are down on the potential for such potentially rude interruptions, more passive customer service chats are slowly gaining in popularity and can now be found on thousands of Web sites.

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“I’M A LIVE REP here to answer questions and offer promotions!!” says Cole when you first visit Technoscout.com. “What product did you wish to chat about today?” Cole will quickly tell you that, no, sorry, the site doesn’t sell DVD players. But there is a full catalog of other electronics items — and if you buy while chatting with him, he can give you a discount.
Technoscout.com is one of the first e-commerce sites to try Proactive chat, the new offering by LivePerson Inc., one of several customer service chat software companies.
Shopping on the Internet is a very sterile experience, according to the folks at LivePerson, who power chats for some 3,000 Web sites. A personal touch is what’s needed, along with some handholding. So LivePerson added “proactive chat” to its slate of services.
“They know as soon as you come in the front door,” said Maria Gomez, spokesperson for LivePerson. “You could be looking for a really cool red sweater and I can help you find exactly what you’re looking for. Honestly, people online want to be helped.”
Well, maybe not that much. Esteban Kolksy, an analyst at Gartner, described “proactive chat” as “one of the most annoying experiences of my life.”
“When you do ‘proactive chat,’ you don’t know what the person is looking for, you just get in their faces. That’s not the experience people are looking for online,” he said.

EBAY SIGNS UP
But apparently, they are looking for chat.
Chat software is a crowded field, with application providers like PeopleSoft also offering chat as part of their suite of customer management offerings. It’s also a small field, says Forrester Research analyst Bob Chatham — he figures chat software providers shouldn’t expect more than $20 million in annual revenue for a while. Still, many big-name brands now using chat to connect with customers, including Fidelity — which uses software from eGain Communications — Earthlink, and QVC. And the Net’s biggest e-commerce firm, eBay, signed a deal with LivePerson just a month ago. EBay’s chats will help confused browsers register bids, said LivePerson CEO Robert LoCascio.
“EBay came to us and said, ‘We want to increase the amount of bids that happen.’ We found that customers would want to bid, but were lost or confused,” he said. “A customer would send an e-mail, but wouldn’t get an answer for 24 hours. On eBay, 24 hours later is too late.”

Instant communication and problem resolution is apparently appealing both to Web sites and their users. According to recent study released by Forrester Research, the number of troubled online shoppers who want customer service using an interactive chat has tripled since 1999 — to nearly 10 percent from 3 percent — and 20 percent had said they tried it, up from 2 percent 3 years ago.

NEW LIFE FOR OLD TECHNOLOGY
Chat is one of the Internet’s oldest, simplest technologies, and as early as 1997 was promoted as an idyllic customer service solution that never seemed to materialize. But chat has enjoyed a resurgence of late thanks in part to increasing familiarity with instant message systems among Net users. More important, however, is the bottom line: companies are furiously chasing elusive cost savings in a tight market. Shifting customers away from 800 phone calls and into interactive chat rooms can sometimes cut costs by a factor of two, or more, some analysts say. Most of the savings revolve around multitasking.
“Companies like Fidelity are finding out it’s actually a very good service channel,” said Forrester’s Chatham. “From a cost perspective, it’s pretty favorable. You can do two or three conversations simultaneously, usually two, particularly when there needs to be some kind of quality around the interaction.”
Not so, LoCascio said. Other efficiencies, like semi-automatic responses or drag-and-drop stock answers like “Hold a moment while I search for the answer” mean witty chat operators can hold down five or six chats at once. So at a place like Earthlink, each customer service chat costs the company only $1.20, compared to $6 for a phone call.

WHAT IT’S LIKE
But it’s generally pretty obvious when a chat support person is distracted by multiple conversations. Answers are unnaturally slow, and can be so automatic that they strike an eerie familiarity to touch-tone information phone lines.
Deanna S. at QVC’s Web site took only about a minute to uncover the mystery brand name of a bottom-dollar DVD player on sale there — the brand wasn’t obvious from the Web page. But when the brand name sounded suspect, she wasn’t much help.
MSNBC: I’m trying to figure out which brand this is:
MSNBC: Item Number E2104 http://www.qvc.com/asp/frameset.asp?class=2039
Deanna S: Please hold while I check on that for you.
Deanna S: The brand name for item#E2104 CD-R & CD-RW Compatible DVD Player with Full Function Remote is “Curtis”. How else can I help you today?
MSNBC: What is a Curtis? Have you ever heard of that brand?
Deanna S: I apologize, I have not heard of the brand name Curtis before.
MSNBC: Can you suggest another brand name in about the same price range?
Deanna S: I’m sorry for the delay. I’ll be right with you.
Deanna S: To see what is available, just type “DVD” into the Search field on QVC’s Homepage and press enter. Once you get the list you will see all the prices and you can click on 9 at a time to compare them by price, etc. How else can I help you?

KEEPING IT SIMPLE
Ashutosh Roy, CEO eGain Communications, concedes that many customers can see through such stock answers. And reducing the number of simultaneous chats only defeats the purpose for cost-conscious companies. That’s why he thinks chat works best only when offered in certain circumstances, to highly-valued customers with complicated questions.
“At Fidelity when they started putting live chat on the Web site and made it prominent they had so much demand they had to pull it back,” he said. The company is now developing more “context-based availability.” For example, a chat invitation button will pop up if a customer is trying to do something complex, such as moving 401(k) money into an IRA — but not if the customers is performing simple tasks, such as researching mutual funds.
But even limiting chat to complex tasks can be unsuccessful, Kolksy said. Alaska Airlines tried to offer chats to help customers that were having trouble booking multiple-leg flights, but customers service employees ended up spending most of the time answering questions about arrival and departure times.
“Once you open access to a channel, customers start asking all kinds of things,” he said.
Susan, who does customer service chats for LivePerson’s software, says that’s true. In fact, some lonely “customers” are really just looking for someone to talk to.
“That’s not a problem,” she said during a chat. “We are well trained for any kind of ‘chatters’ and I’m here to explain about our services and features, so, I can say something like, ‘Is there anything else about our features you’d like me to answer?’ ”

COSTS ARE STILL HIGH
Susan sits in front of her computer near Tel Aviv, Israel, and provides worldwide customer support. That’s typical. Similar to the world of customer service call centers, low-cost overseas chatters are often on the other side of the computer screen, many based in India.
Still, the cost savings aren’t always as dramatic as companies hope. In fact, the average cost of a chat can vary wildly, says Kolksy, from $2 to $46 per chat, based on how busy the chat operators are.
“For companies that have implemented this, it turns out to be very expensive,” to open a dialog with every customer who wants to chat. And while purchase of chat software had been steadily rising through the beginning of this year, Kolsky said the market has softened considerably in recent months.

NEW CHATTING REVENUE MODEL
That’s part of the reason LivePerson, which is struggling under the weight of possible Nasdaq delisting, is trying to open new frontiers with Proactive chat. The ability to track customers as they click through the Web site, notice when one is having trouble at the checkout point, and intercede will add as much to the bottom line as the cost savings subtract from expenses, he argues.
But even LoCascio concedes “interruption” chats can be seem unnerving or invasive. So Technoscout.com changed its strategy slightly. Instead of an abrupt chat window opening up, a coupon offer slowly slides across the site’s home page. If the visitor accepts the coupon, they are entered into a chat.
“This way, you as a customer have to engage first,” he said. About 15 percent do, and the company claims “proactive chats” increase sales 15 to 20 percent. Susan, LivePerson’s chatter, said she enjoys upselling products to customers who casually stop by the Web site with a simple question. “I’d say something like, ‘Hi, would you like to see our software features...show you how we can help your business, and try to close the sale online!’ Right there, in real time.”
But Gartner’s Chatham’s not so sure it will work.
“I haven’t heard of anybody using it effectively. It sounds like being harassed in a retail store,” he said.
Forrester’s Kolksy thinks if chatting is to succeed at all as a customer service tool, less personal, more cost-effective conversations are necessary. Several companies are working on technology that combines the notion of personal agents, capable of answering simple questions in chatty form, with human chatters who only intercede when necessary.
“Automating chats ... it’s that kind of innovation that will make chat come back,” he said.