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Market Overview: Chat Solutions For Customer Service · PDF file2009 to 43% in 2012. ......

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    Market Overview: Chat Solutions

    For Customer Service Twenty Solutions For Delivering Differentiated


    A Forrester Research Report

  • Forrester Research, Inc., 60 Acorn Park Drive, Cambridge, MA 02140 USA

    Tel: +1 617.613.6000 | Fax: +1 617.613.5000 | www.forrester.com

    Market Overview: Chat Solutions For Customer Serviceby Kate Leggett and Art Schoeller, June 4, 2013

    For: Application Development & Delivery Professionals

    key takeaways

    the Chat Channel enjoys High satisfaction Ratings and Is Increasingly ImportantChat usage rates as a customer service engagement channel have grown from 30% in 2009 to 43% in 2012. It is widely adopted by all generational segments and has high satisfaction ratings superseded only by voice interactions.

    Chat Vendor solutions aim to support several Customer-Related GoalsA wide variety of stakeholders in an organization -- from eBusiness to marketing to customer service, and the contact center -- purchase and use chat as a customer engagement channel. Each stakeholder has different requirements that span customer service, customer retention, and revenue-generation goals.

    Chat solutions Fall Into Five Broad CategoriesThe chat vendor landscape is mature and crowded. Forrester groups chat vendors into five broad categories, which cater to a subset of stakeholders: standalone chat vendors, online engagement vendors, multichannel vendors, CRM suite customer service vendors, and contact center vendors. Map your needs to vendors within this context.


  • 2013, Forrester Research, Inc. All rights reserved. Unauthorized reproduction is strictly prohibited. Information is based on best available resources. Opinions reflect judgment at the time and are subject to change. Forrester, Technographics, Forrester Wave, RoleView, TechRadar, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective companies. To purchase reprints of this document, please email [email protected] For additional information, go to www.forrester.com.

    For ApplicAtion Development & Delivery proFessionAls

    wHy ReaD tHIs RePORt

    Customers demand superior service and support as the price for their ongoing loyalty and patronage, and they are increasingly leveraging the chat channel for customer service. The chat vendor landscape is mature and crowded. Many vendors offer a range of chat capabilities and support a broad set of usage scenarios that application development and delivery (AD&D) pros supporting customer service operations can choose from. This report spotlights the capabilities of 20 chat vendors and offers a decision framework for choosing the right type of chat solution for your needs.

    table of contents

    Chat: Critical to the Promise Of effortless Customer service

    Chat Vendors Fall Into Five Categories, each with a Unique Focus

    Profiles Of Five Categories Of Chat Vendor solutions


    Build a Chat Vendor strategy with a View toward the Future

    supplemental Material

    notes & resources

    Forrester analyzed data from Forresters north American technographics customer experience online survey, Q4 2012 (Us). Forrester interviewed 20 chat vendors to solicit input for this report.

    related research Documents

    Assess customer service capabilities to pinpoint opportunities For Better serviceDecember 26, 2012

    Build An outside-in contact center road mapnovember 20, 2012

    transform the contact center For customer service excellenceJune 22, 2012

    Market Overview: Chat solutions For Customer servicetwenty solutions For Delivering Differentiated experiencesby Kate leggett and Art schoellerwith stephen powers and sarah Bookstein






    JUne 4, 2013


  • For ApplicAtion Development & Delivery proFessionAls

    market overview: chat solutions For customer service 2

    2013, Forrester Research, Inc. Reproduction Prohibited June 4, 2013

    CHat: CRItICal tO tHe PROMIse OF eFFORtless CUstOMeR seRVICe

    Nearly all companies (92%) say that a good customer experience is one of their top strategic priorities, and 60% say they want to use customer experience as a competitive differentiator.1 Customer service is often the cornerstone of a companys customer experience strategy; 40% say that improving the customer experience is their top customer service goal, with a further 40% saying that its their second most important goal.2 However, the reality is that few companies are doing anything about optimizing the service experience; they still primarily focus on cost-control measures, and only 47% of companies have a dedicated budget for customer experience initiatives let alone for improving the service experience.3

    Forrester data shows that customers want efficient, effortless service. Fifty-two percent of US online adults say that they are very likely to abandon their online purchase if they cannot find a quick answer to their question, and 71% say that valuing their time is the most important thing a company can do to provide them with good service.4

    Customers are very comfortable engaging with companies for customer service via chat. Chat usage rates have risen in the past three years from 30% in 2009 to 43% in 2012. As well, all demographics are comfortable using this channel, with even one-third of Older Boomers (57-67) and the Golden Generation (68+) already using chat for customer service. Chat also has high satisfaction ratings across all generations satisfaction ratings that are only superseded by those of the voice channel.5

    After a slow start a decade ago, businesses today have embraced the chat channel, as chat can cost less than a voice call, especially for organizations that allow their agents to handle multiple chat sessions simultaneously. Companies can easily build a business case and justify the purchase of chat solutions. Organizations as large as Verizon, Virgin Atlantic, and Bank of America and as diverse as the Redwood City Police Department, The North Face, and Saudi Basic Industries Corporation (SABIC) plastics have successfully deployed chat for customer service. In our most recent study of chat technology adoption rates for customer service, almost half of the organizations we surveyed had implemented chat as a communication channel for their customers.6

    Chat Helps Companies Push the envelope On Customer engagement

    Over the past decade, chat has become an integral component of online web and, more recently, mobile self-service. Chat is a mature channel, with clearly established best practices that deliver real business value.7 The technology has demonstrated its ability to improve customer service department operational efficiency by collecting information to populate a service ticket and quickly answering customer questions by leveraging predefined answers from a content repository; to improve sales by reducing shopping cart abandonment rates; and to better sales conversion by helping educate customers during pre- and post-purchase interactions. Yet, companies reacting to customer demand for more personalized, targeted service experiences are currently pushing the envelope on newer chat scenarios.

  • For ApplicAtion Development & Delivery proFessionAls

    market overview: chat solutions For customer service 3

    2013, Forrester Research, Inc. Reproduction Prohibited June 4, 2013

    Chat success stories include:

    Delivering optimized customer experiences. Drugstore.com incorporated Oracle RightNows chat solution as a strategic component in supporting the company mission of delivering superior customer experiences. Agents use chat to understand website visitor requirements, educate visitors on available products and product specifications, and guide them to the right products for their needs. Drugstore.com reports a 30% increase in conversion rates, a 20% increase in shopping cart size, reduced abandonment, and increased customer satisfaction.

    Increasing customer satisfaction. Virgin Atlantic Airways, a UK-based carrier, uses chat from LivePerson to increase customer satisfaction and loyalty. Chat has reduced email volume and backlog, allowing customer inquiries to be dealt with at first contact. Customers needs are met in real-time and chat has helped raise Customer Satisfaction (CSAT) scores to more than 80%. Costs per chat are less than both phone and email costs. In addition, customers who chat have an average order value of more than 15% over those who self-serve; customers who chat also purchase products at nearly 3.5 times the rate of those who do not.

    Decreasing operational costs. Charter Communications, the fourth largest cable operator in the US, providing video, Internet, and phone services, uses Next ITs virtual agent solution in conjunction with an existing chat application to provide a seamless experience on its support site. By using reports to analyze chat sessions, Joe Murray, VP of customer care technology operations, explains: Charter has been able to optimize operations by deflecting 78% of chats with better self-service content. For example, Charter determined that 38% of incoming chat requests were for a reset of user names and passwords, which is now an automated service available to subsc

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