I often get the question: Can I afford a targeted chat? My answer is usually: Can you afford not to have one? - and for sure, you cannot afford a basic chat. Chat is a powerful tool in the marketing manager's toolbox, but it can also be an expensive proposition - and not always for the most obvious reasons.

Total cost of operating a chat

Most basic chat software are relatively inexpensive, some of them are even free and most do a pretty good job - they are also inexpensive to implement and agents can chat with several customers at the same time - It is not hard to realize, that the highest cost of operating a chat comes from the manpower and associated costs to operate it. This is also were the cost savings are - Unlike basic chat, a targeted chat reduces costs: it monitors visitor behavior and profile and sends invitations to chat at the appropriate time focusing on abandonment points - it limits as much as possible unnecessary discussions - or interfering with a successful unassisted check out.

Companies are increasingly looking at chat as a branding tool

Online customer acquisition has become more expensive in the last few years. Online competition has increased, driving some industries to spend up to 25% of their sales to generate qualified traffic. Conversion rates online remain relatively low - so this expensive traffic gets even more expensive. A well implemented targeted chat will increase conversion rates by up to 40%. Successful companies are using chat to build customer trust and increase average shopping cart value. By being helpful and appropriate, a chat agent will increase customer retention and lifetime value.

I often come across this scenario

Websites visitors are prompted to chat as soon as they land on the site. Each subsequent page visited offers a chat - usually with a close ended question! "Hello, my name is John, do you need help?" - These pro-active chat requests are coming at the wrong time and are at best annoying - they are usually ignored. Conversion results are poor, cost of agents increases and customer satisfaction decreases. The project gets shelved and the chat is not attended.

In conclusion: The hidden costs of chat, lye as much in the cannibalization of unassisted online sales at a cost, as it does in long term customer loyalty. However, we have come a long way in chat technology, real time targeting tools can avoid these pitfalls and are a powerful tools to customer engagement.