Retailers Without Chat: A Missed Opportunity

Kate Leggett
Vice President, Principal Analyst
March 27, 2018

Chatting, by definition, is meaningless, trivial talk – but web “chatting” is anything but; it is starting to transform digital customer experiences. And it works. Customers want to use chat. Forty-five percent have used it to interact with a live agent in 2017. The companies that get it are moving towards a holistic chat strategy that straddles both customer service and sales.

Why does chat-based sales and customer service work?

There are a myriad of use cases where web chat improves the customer experience and drives business outcomes in pre-purchase and post purchase engagement. For example, chat puts customers at ease when purchasing a product or service they have never seen nor experienced in person. It also assists in minimizing purchasing errors and eliminating buyer’s remorse, which are among the top reasons for product returns.

On the sales front, Forrester data reveals that site visitors who use web chat are 2.8x more likely to convert than those that don’t. And according to a benchmark study by Bold360 (a LogMeIn company), a buyer who chats will spend 60% more. The incessant market pressures to try to increase top line is putting incremental sales – front and center.

Where’s the chat?

According to the National Retail Federation (NRF), last year holiday sales during November and December increased 5.5% over the same period in 2016 to $691.9 billion. You would imagine that major retailers would have a customer engagement strategy that is more chat-centric and conducive to improving sales, and not just another add-on channel. However, our findings suggest otherwise.

We examined ten websites of major retailers: Amazon, Best Buy, Dell, J.C. Penney, Kohl’s, Macy’s, Sam’s Club, Target, Toys R Us, and Walmart. We found that:

  • Only one out of ten major retailers is using chat for sales. Dell offers sales chat, unlike the other retailers. Sales chat is there to guide customers, answer questions and thereby provide an optimal purchase experience. In fact, according to Forrester data, half of US online adults will abandon their purchase if they cannot find a quick answer to their question.
  • All ten of the major retailers provide customer service chat. However, it seems like just another channel that the retailers stood up. In most instances chat was not easy to find — it’s buried in their Contact Us sections. Oftentimes, you must go through an annoying form-fill process before starting a chat session. And occasionally agents were not available to chat.
  • Only one of the ten major retailers has proactive chat. Dell’s sales chat is proactive. This method is more sophisticated than reactive chat, where the customer must find chat on the website. Proactive chat is all about engaging the customer at the right time in their journey, improving the customer’s online experience.

Make chat a cornerstone of your customer engagement strategy

We’ve taken a look at the website experiences of 10 large retailers and found Dell is the furthest along in executing a customer engagement strategy with chat as a pillar. For the other retailers, chat is an add-on and not a staple of their strategy. This translates to missed revenue opportunities and areas where customer experience can be optimized. To learn about how proactive support will help you to help your customers, please see the Forrester report, “The Second Coming of Digital-First Customer Service.”

Madeline King contributed to this blog.

Related Forrester Content (For clients or purchase)

Market Overview: Chat Solutions For Customer Service
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