5 Benefits of Live Chat You Need to Know

By: on October 26, 2020

Your customers have become used to instantaneous interactions with their friends, family, and colleagues and now expect similar interactions with your business. They expect you to update them about their purchases, answer their questions, and address their service requests immediately.

Most businesses have already taken note of this expectation and are finding ways to meet it. One way to address this expectation is through the use of live chat.

In this article, we will look at the benefits of live chat in more detail and understand how your business can use these to its advantage.

But before we look at live chat benefits, let’s quickly go over what live chat is and its common use cases. This will help us understand the benefits more thoroughly.

What is live chat?

Live chat is a functionality that helps you communicate in real time with your website visitors or mobile app users. Live chat mostly takes place through a window within an internet browser or app. You can use live chat for various purposes such as customer service, marketing, sales, ecommerce, etc.

Live chat provides a bridge between your business and customers. And, it’s being adopted rapidly. According to Gartner, over 85% of businesses will offer some kind of live chat on their website or mobile apps by 2022.

Businesses are rushing to invest in live chat not only to meet customer expectations but also because it offers several benefits. Research shows that 79% of businesses find that live chat increases sales, customer loyalty, and revenue. In 2019, there was a 3.84% increase in conversion rates and a 6% overall rise in revenue.

What are the common use cases of live chat?

Here are the common use cases of live chat:

Business function Use case

Customer service
  • Provide real-time support
  • Resolve queries or incidents
  • Guide potential customers through their buyers’ journey

Sales and marketing
  • Manage lead generation
  • Guide customers through the onboarding process
  • Cross-sell and upsell products and services

Ecommerce
  • Guide customers through their purchase journey on the online store.
  • Help customers make informed purchase decisions.

Customer experience
  • Proactive customer engagement.
  • Acquiring more customer information to personalize products and services.

What are the benefits of live chat?

There are multiple benefits of live chat, as we’ll see in this section. However, it’s important to bear in mind that these aren’t the only benefits a business may derive from live chat. The benefits may vary based on how and for what purpose a business uses this tool. For example, when used in marketing, the benefit may be better quality leads whereas when used in customer experience, it may be contextual customer support.

5 benefits of live chat you need to know.

That said, in this section, we’ll look at some overarching benefits that businesses using live chat experience in different industries.

1. Increased customer satisfaction with real-time access to support

Using live chat has been proven to increase customer satisfaction. Multiple studies state that customers prefer live chat over phone or email support. If you’re wondering why live chat is so effective at satisfying customers, it’s because live chat allows customers, prospects, and website visitors to access support and find solutions to queries in real time.

Another reason for the high customer satisfaction scores of live chat is that many businesses offer an omnichannel live chat service. It means that customers can get the same live chat experience across most digital channels and devices such as laptops, mobile phones, and tablets. Therefore, customers get to interact with a business through whichever channel is most convenient for them.

2. Greater conversion rates with fewer roadblocks in buyers’ journey

Live chat has a direct impact on conversions. It ensures timely access to support for prospects and customers that face challenges while shopping online. In fact, 38% of customers actually made a purchase after a helpful chat session with an agent. Clearly, fewer roadblocks in the buying process lead to speedier and greater conversions.

Research also shows that people who use live chat spend 60% more per purchase than those who don’t. A staggering 77% won’t make a purchase at all if there’s no live chat support. The numbers are stacked in favor of higher conversion rates with live chat.

In fact, Total Gym Fitness, a fitness equipment provider, took this a notch higher and modernized its mobile live chat with newer features, such as a more intuitive user interface and product guides. The result was a two and a half times boost in conversions over the basic live chat version (full report available to Gartner clients).

3. Improved customer experience with personalized interactions

Live chat offers a unique opportunity for businesses to provide a more personalized customer experience. While reducing query resolution time also improves customer experience, personalized services add the cherry on the cake. Wondering how? Live chat allows businesses to learn more about customers and understand pain points, as well as points of interruption in the buying process. Businesses can then weed out these issues and optimize the buying experience for customers.

Further, live chat sessions allow businesses to learn more about customers and their preferences. Using this info, they can offer more personalized product or service recommendations known as “sticky products”. Sticky products are products or services that a customer will be most inclined to purchase based on their needs or interests. These products are perceived as being highly valued by customers as they often address their needs. And, businesses can offer these products only by learning more about customers.

4. Fewer costs while providing simultaneous support to multiple clients

Managing and scaling live chat is more economical than other support channels. Research shows that the cost per contact for live chat is only $5 compared to the cost per contact for call centers, which is $12. While a live chat agent can efficiently handle multiple queries at the same time, doing the same is nearly impossible for phone support agents who usually cater to both phone and email support.

Live chat support agents can easily deliver quality responses to multiple users by using multiple browser windows or more than one desktop screen. This allows you to distribute clients among a smaller number of agents and also makes scaling the team more cost effective.

When a leading WordPress hosting provider launched its live chat support, it quickly became their most popular support channel. Using live chat, they were able to solve a whopping 90% of queries within a single session right out of the gate, saving them both time and money. The cherry on the cake is that when they launched this initiative, they started out with their live chat availability merely spanning 14 hours per weekday.

5. Increase customer retention through stronger customer relationships

Customer retention is a priority for most businesses as it takes a lot more effort and resources to acquire new customers. Moreover, to survive in the long run, your business needs to build lasting relationships with its customers. Luckily, you can do all this through live chat.

With live chat you can ensure your customers are satisfied with your services, collect their feedback, and ensure personalization. You can also optimize your products and services to serve customers better. Using this data, you can learn about which stage of the buying process the customer is in, and accordingly offer support or supporting material such as purchasing guides or helpful articles.

The numbers vouch for the effectiveness of live chat at retaining customers. 63% of customers are likely to return to a website where they have had a live chat session. And, 62% won’t mind buying something from such a business.

How do you get the maximum benefit out of your live chat sessions?

While there are multiple benefits of live chat, as we’ve just seen, it is important to remember that simply using live chat sessions won’t deliver these benefits. Deriving these benefits depends on how you use live chat. However, this is not a huge undertaking. Just keep these best practices in mind to get the most out of your live chat tool:

  • Start small and measure continuously: Start small by offering a click-to-chat button on your mobile app or website. As your business matures, you may progress towards proactive chats where you offer help without your customers explicitly asking for it. Keep your user informed that you offer live chat. Learn from your initial engagements and track customer satisfaction, agents’ performance, and knowledge base accuracy.
  • Design the user interface (UI) for both customers and service agents: The UI should be intuitive for both your customers and agents. It should allow easy access to support options for your customers and should also help agents optimize their performance and provide support effectively.
  • Create a comprehensive knowledge base: A live chat knowledge base helps your team share and collect knowledge internally. It can double as a help center for your customers. A knowledge base is a fundamental requirement for effective live chat sessions. According to Gartner, without the knowledge base your live chat agents are half as productive as voice-based agents (full report available to Gartner clients).
  • Pick the right software: You’ll need a live chat software to effectively manage your live chat sessions. Most live chat tools offer features such as chat routing, proactive chat, chat monitoring, and chat rating. Before deciding on a live chat tool, make sure to read its reviews on third-party websites, such as ours, to learn from the experiences of other users. Also, schedule a software demo as this will allow you to get a working view of the tool’s features and clarify any doubts that you may have with the vendor.

Need more help?

If you have any concerns about using live chat or are struggling to optimize it for your business, don’t hesitate to seek help. You can reach out to us at Software Advice and get support and insights from an advisor who’s an expert in your industry.

You may also like:

6 Simple Ways To Retain Customers for Your Retail Store

Create a Customer-Focused Culture With These 5 Tips

5 Tips for Listening to—and Understanding—Your Customers

Want to book an appointment with an advisor?

Yes, I Do

Want to book an appointment with an advisor?

Want to book an appointment with an advisor?