Live chat has become an increasingly popular customer support tool for e-commerce businesses, offering a range of benefits that can improve business results. In this article, we’ll explore the top benefits of live chat and how it can help your business stand out from competitors.

In today’s fast-moving business climate, e-commerce enterprises encounter fresh challenges in providing efficient customer service and driving sales. As digital channels gain popularity, clients demand prompt attention and personalized interaction while conducting business online. In this regard, live chat has emerged as a critical tool for e-commerce companies, enabling them to streamline customer service processes, enhance shopping experiences, and ultimately increase profits.

Live chat provides numerous advantages for e-commerce businesses, such as heightened customer satisfaction, improved lead generation, increased sales and conversions, cost-effective customer support, and valuable customer insights. By integrating live chat, e-commerce firms can adapt to their customers’ changing needs, distinguish themselves from competitors, and generate growth in a highly competitive market.

In this article, we will explore the top benefits of live chat for e-commerce companies and showcase how these benefits have translated into real-world results for businesses in the sector.

A brief history of Live Chat

Live chat has come a long way since its inception in the late 90s. Israeli entrepreneur, Arik Vardi, created the first online chat system in 1996. However, it wasn’t until 2002 that live chat emerged as a powerful tool for e-commerce businesses. Companies such as LivePerson and BoldChat were early incumbents in the market, offering live chat services that allowed customers to interact with companies in real-time. Live chat has evolved significantly, with modern-day chatbots and AI-powered chat systems becoming the norm for many e-commerce companies.

Research shows that 52% of customers prefer a company offering chat assistance, and 75% prefer live chat over any other communication channel. Almost two-thirds of millennials (63%) would rather have basic customer support queries answered by live chat than by phone or email. 

These statistics demonstrate the value of live chat in the e-commerce industry. However, despite the desire for consumers to use live chat platforms, research by SuperOffice suggests as few as 9% of companies deploy live chat on their websites. That leaves an opportunity to gain a competitive advantage.

As technology advances, we can expect further developments in the live chat space, such as chatbots that can handle more complex inquiries and greater personalization to enhance the customer experience. E-commerce businesses that embrace these advancements and integrate live chat into their customer service strategy will be best positioned to succeed in the future.

The synergy between Live Chat and AI Chatbots

Before talking about the benefits of live chat, it’s essential to understand how the channel fits in with trends in AI and dispel some of the myths.

AI chatbots such as Chat GPT have exploded onto the scene with a scalable and efficient approach to handling customer queries. Companies can benefit from bots available 24/7 and free up agents to take on more complex work by handling basic and repetitive inquiries.

However, companies should not rely solely on AI chatbots and generative AI technologies. While these technologies have made significant progress in recent years, they still have limitations. AI chatbots may be unable to understand the nuances of customer inquiries or adapt to different communication styles, leading to frustrating customer experiences. Moreover, AI chatbots may be unable to provide creative solutions to complex problems or the emotional support that human agents can offer.

Live chat offers a personalized and empathetic touch vital for building strong customer relationships. With live chat, customers can engage in real-time conversations with human agents, who can understand the nuances of their inquiries and provide tailored solutions. This human touch is essential for ensuring customer satisfaction, loyalty, and business growth.

A hybrid approach that combines live chat and AI chatbots can create an efficient and effective customer service experience for businesses. Companies should leverage both technologies’ strengths to optimize their customer service processes, reduce response times, and ultimately enhance customer satisfaction and loyalty.

The importance of Live Chat

One of the biggest challenges facing e-commerce companies today is the loss of billions of dollars in online sales due to the absence of immediate customer engagement options. This issue is compounded by users’ frustration with repetitive “Contact Us” forms, unhelpful FAQs, and robotic chatbot interactions. This has increased shopping cart abandonment rates as customers seek better customer support experiences elsewhere.

Research has shown that users overwhelmingly prefer immediate assistance from a live chat representative over asynchronous channels like email or social media, especially over chatbots. Customers who engage in live chat are significantly more likely to convert than those who do not, regardless of whether they initiate the conversation or are invited. Studies have also demonstrated that live chat can increase conversion rates by up to 4x or more.

Below, we will talk about the five primary benefits of deploying a live chat solution for your e-commerce business.

Benefit 1 – Improved Customer Service

Live chat has become an increasingly popular option for companies to improve customer service. In fact, according to a study by J.D. Power, customers who engage in chat are three times more likely to make a purchase than those who do not. Furthermore, the study found that customers who use chat have a higher satisfaction rate (42%) compared to email (36%) and phone (33%). These statistics highlight the effectiveness of live chat in improving customer service, which can lead to increased sales and revenue for businesses.

Moreover, live chat offers a unique benefit that sets it apart from other customer service channels – the ability to provide a personalized experience. Customers can receive tailored solutions to their inquiries, enhancing their overall experience.

A study by Forrester found that personalized customer service leads to increased loyalty and advocacy, with 77% of customers likely to recommend a company after a personalized experience.

Therefore, live chat offers quick and effective customer service and the ability to create a personalized experience that can lead to increased customer loyalty and advocacy.

A Forrester survey suggests that over 60% of companies who adopt live chat for real-time support believe it enhances customer loyalty.

Benefit 2 – Enhanced Sales and Conversion

Users who engage with Swivl live chat are 5.2x more likely, on average, to become customers than users who do not chat.

While AI chatbots can be programmed to answer common questions, they cannot truly understand the customer’s needs and tailor their responses accordingly. On the other hand, live chat agents can empathize with customers, provide personalized recommendations, and address objections in real-time, ultimately leading to higher conversion rates.

For example, imagine a customer is interested in purchasing a high-end camera but unsure which model to choose. An AI chatbot may provide general information about the features and benefits of each model. Some generative AI could take that further and offer deeper opinions, but there is no way of legitimizing whether answers are correct, up-to-date, and relevant.

 A live chat agent could further the conversation by asking customers about their needs and preferences. The live chat agent could then provide personalized recommendations based on the customer’s input and help guide them through the buying process, ultimately increasing the likelihood of a sale.

Cart abandonment statistics show that more than half of customers drop off an e-commerce site at the checkout because they cannot find the necessary answers. Live chat support on the website can drastically reduce abandonment rates by offering fast and reliable access to expert agents.

Oracle, a global software company, implemented live chat and saw a 20% increase in leads converted to sales.

Martech Zone suggests customers are 51% more likely to purchase after using live chat support to get their answers right away.

Benefit 3 – Increased Lead Generation

Live chat offers a unique opportunity for e-commerce businesses to capture leads by providing personalized attention and instant assistance to potential customers. When visitors arrive at a website, they may have questions or doubts preventing them from purchasing or submitting their contact information. With live chat, a representative can immediately engage with the visitor and offer support tailored to their needs. This personalized attention can differentiate between a lost lead and a loyal customer.

According to Insider Intelligence, websites that offer live chat generate four times as many leads as those that do not. Furthermore, 41% of consumers prefer live chat for online shopping support.

Using targeted messaging is an example of how live chat can improve lead generation. For instance, if a visitor has been browsing a particular category of products, the live chat representative can offer personalized recommendations or promotions to incentivize them to make a purchase or leave their contact information.

According to marketing expert Neil Patel, introducing live chat on your site can increase lead generation by up to 40%.

Benefit 4 – Cost Effective Customer Support

In addition to being more efficient, live chat also saves companies money. According to a study by Kayako, live chat support is 17-30% cheaper than phone support. Live chat allows agents to handle multiple customer inquiries simultaneously, reducing the need for additional staff. Additionally, the cost of implementing and maintaining a live chat system is often lower than that of a traditional phone system.

An example of how cost-effective customer support through live chat can work in practice is a company that sells computer software. If a customer has an issue installing the software, they can contact the company’s live chat support team. A customer service representative can quickly walk the customer through the installation process while addressing any other questions or concerns.

This approach saves the customer time and reduces the time the customer service representative spends assisting the customer, allowing them to handle more inquiries in a shorter amount of time. As a result, the company can provide quality customer support at a lower cost, improving customer satisfaction while maximizing profitability.

Live chat transcripts can save companies money by reducing the need for additional staff and training resources. Rather than hiring more employees to handle customer support, companies can use chat transcripts to train new hires and reduce training time and costs. Chat transcripts can also be used to resolve customer disputes and prevent chargebacks, saving companies money and protecting their reputation.

Live chat also has a 90% resolution rate, according to Accenture, reducing the need for follow-up calls and improving first-call service levels.

The immediacy of live chat is also a huge customer benefit, with potential clients getting an answer within two minutes on average, which massively outperforms other channels.

Regarding business efficiency, having such fast response times reduces queues, frees up agents and improves customer satisfaction. Call Centre Helper reports a 30% cost reduction through live chat services.

Benefit 5 – Valuable Customer Insights

Live chat is an effective tool for collecting valuable customer insights. When customers engage in a chat conversation, they provide information about their needs, preferences, and pain points. Companies can analyze these chat transcripts to identify trends and patterns that give deeper insights into customer behavior. For instance, if several customers ask the same question about a product, it may indicate confusion about the product’s features, and the company may need to clarify them.

By analyzing chat transcripts, companies can also identify customers’ common objections about their products or services. This information can help the company adjust its messaging and marketing strategies to address these objections better and improve sales.

Furthermore, live chat can also provide companies with customer demographic data. For instance, a customer may provide their name, email address, and location during a conversation. Companies can use this information to understand their customer base better and tailor their products and services to meet their needs.

For example, suppose an e-commerce business offering online courses notices through analyzing chat transcripts that many customers are asking for courses on a specific topic they currently do not provide. In that case, they can take that feedback and develop a new course on that topic, increasing customer satisfaction and loyalty.

ICMI discovered that customers who engage with live chat services are worth 4.5 times more than customers who do not. Understanding transcripts and driving customers to the proper support directly impact the bottom line.

The Human Touch Makes All the Difference: Why Live Chat is Vital for E-commerce Businesses

In today’s world of e-commerce, where customers can easily get lost in the digital sea of products and services, live chat provides a human touch that can set businesses apart from their competitors. While AI chatbots have undoubtedly revolutionized customer service, they still lack the human touch that live chat provides. A study by American Express found that customers still value human interaction in customer service, with 68% stating that they prefer to speak with a live customer service representative. This highlights the importance of live chat in providing a personalized and humanized customer experience.

Furthermore, live chat enables businesses to build customer trust and credibility. Companies can demonstrate their commitment to customer satisfaction and build long-term customer relationships by providing instant and effective support. A study by eMarketer found that 63% of customers are more likely to return to a website that offers live chat, highlighting the impact that live chat can have on customer retention.

While AI chatbots have their place in customer service, they cannot replace the human connection that live chat provides. Therefore, e-commerce businesses must leverage live chat to create a superior customer experience and stay ahead of the competition.

Why you should choose a Live Chat solution like Swivl

Live chat is a powerful tool for companies looking to improve customer service, increase lead generation, enhance sales and conversions, provide cost-effective customer support, and gain valuable customer insights. By implementing live chat, companies can set themselves apart from competitors and provide a better overall customer experience.

Swivl’s live chat can serve as your business’s primary support channel with unlimited capacity to scale, reducing or eliminating the need for other support channel resources like email, phone, and social media. Swivl builds knowledgebase systems from scratch for startups, integrates with existing infrastructure at large enterprises – and everything in between. Your new live chat solution is designed to be a natural extension of your business.

Moreover, Swivl measures and reports baseline conversion metrics before and after implementing live chat so you can see how Swivl drives business growth. Regular reports showcase key metrics relevant to your business goals, and we even calculate the return on investment from your live chat investment.

Speak to Swivl today and find the right live chat solution for your business.