Seven Reasons Live Chat Fails

Seven Reasons Live Chat Fails And How Smart Dealers Use Live Chat to Sell Cars

Engage the thousands of shoppers who abandon your website each month & get more leads from your website today

This eBook, the first in a series, is a resource to help automotive dealers use live interaction to increasecustomer satisfaction and qualified lead generation from websites. The automotive consumer markethas migrated and shoppers now spend more time on dealership websites than in dealership showrooms.Success in today's market requires a fundamental change in thinking about meeting shoppers' needsat the dealership’s website.

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1. Belief that the technology alone will produce results

Technology, without proper planning, implementation and ongoingmanagement, will not improve your business. This is particularlytrue for live chat. It is not a “set it and forget it” technology. Itrequires highly involved planning, manning and ongoing analysisto produce success. Live chat can produce amazing results,but not simply by adding a chat button on your website.

2. Lack of dedicated staff to manage the chat duringpre-selected hours

If you include a “click to chat” button on your website, then youmust have trained staff available to answer questions in a timelyfashion. Shoppers become very frustrated if they think the op-tion of chat is available, when it’s really not. The golden rule forchat is: either use it, and fully commit the required resources,or don't use it at all. There is no in-between. (Similar to thephones at your dealership, if your staff doesn’t pick them upwhen they ring, you will likely have angry callers.) Immediacyis essential for successful chat. If skilled, dedicated chat agentsare not available within seconds, then the immediacy is lost.

3. No pre-implementation planning

Chat, like any addition to business operations, requires fore-thought and integration with the overall strategy. Although chatcan be deployed very quickly, it should not simply be put on thedealership website without a full plan to successfully incorpo-rate it into your dealership’s operations. Important questionsneed to be answered and goals must be set and measured formaximum success.

Top Seven Reasons Live Chat Deployment Fails

4. Chat is not incorporated into overall salesand marketingstrategy

Live chat is most effectively used as a valuable component of the dealership’smarketing strategy, rather than merely an add-on piece separatefrom other initiatives. It is most powerful when it is integratedwith the dealership’s overall branding and promotions, workingto communicate your offline promotion to your web shoppers.

5. Untrained staff without understanding of themedium's unique communication requirements

Live chat, like all media, has its own special characteristics andmethods for success. What works on the phone or in personis not always what works in live chat. Whether you decide tomanage chat from within the dealership, outsource it to aprovider, or use a combination of the two, the dealership andthe vendor must understand the unique characteristics of themedium and the requirements for success. Chat agents mustbe trained, knowledgeable, effective and engaging with yourautomotive shoppers.

Seven Reasons Live Chat Fai ls | 2

6. Lack of consistent data analysis to guide continuousimprovement

Dealerships that use chat software which tracks visitors' movementthroughout the website have greater success. Chat agents cansend more helpful, personalized messages when they can mon-itor what visitors see and do on the website. For example, ifsomeone began completing a form and stopped, the chat agentcan ask if they need help. If someone has tried to configured aPrius three separate times, they probably have questions aboutoptions. Other key metrics must also be analyzed on regularbasis to create a continuous improvement system.

7. Deploying passive chat, rather than proactive chat

InternetRetailer.com estimates that 15% of web visitors acceptproactive invitations to chat. That statistic is for "proactive in-vitations" only. Sites that merely have a "click to chat" buttonhave far lower engagement rates. While some shoppers mightclick to chat, offers to help at key points in the shoppingprocess produce much higher results. Proactive chat lets you“Meet & Greet” shoppers and offer assistance on your website,just as you do at your physical dealership.

The number one reason live chat fails at the dealership is the mis-conception that just adding a chat application to your website willproduce results. The technology in and of itself adds no value to awebsite. In fact, it can produce negative results if site visitors thinkthey have access to live chat but receive no response when theyattempt to engage in the chat session. Lack of planning is anotherculprit for not receiving the full benefit of chat.

Some Key questions to ask during planning are: • How do we expect our dealership to benefit from live chat? • What are our goals? Are they realistic? • How will live chat fit into our overall marketing and

sales strategy? • Who will manage the chat? • How will they be selected & trained? • How will we track and measure results? • How often will revisit our practices to make sure we're

continuously improving?

When these questioned aren't asked and thoughtfully answered,failure is almost certain. Live chat also needs ongoing data analysisto determine what is working effectively and what is not. Today'spremier chat providers offer this data and analysis, and it is vital formaximizing success and continuous improvement. Armed with theknowledge to avoid pitfalls, smart dealers can then move forward tomake live chat the best generator of qualified leads for the dealership.


Live chat is not new. Early incarnations were available more thanten years ago. What's new is the sophistication, targeting andtracking ability, and best practices that are now available. Manydealers and other online retailers tried earlier, less effective, versionsof chat only to be disappointed with the results, and abandon thetechnology. As with most new technologies, early adaptors did notactually know how to be successful with the new tool. They werejust trying it out to see what they could make happen. Now, how-ever, after years of data collection and research, the keys to effec-tive chat are known, and it is estimated that 10% of dealershipscurrently use some form of chat.

Statistical analysis concludes that dealership web leads outperformall other lead sources; your dealership website leads are the mostvaluable of all leads because they have the highest closing ratio.Therefore, it is financially beneficial to drive more leads from yourown website into your dealership’s Internet department. Today’sprofessionally managed live chat is a proven method to increasewebsite lead generation, so the question becomes what keepsdealerships from embracing this technology? Reviewing the historyand evolution of live chat provides valuable insight.

The Evolution of Chat and the Growing Impact it has onAutomotive Internet Sales

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1996-2001 — Software and applications become widely available toallow synchronous text communication between people on the Inter-net. It was predominantly used for personal chat, entertainment andrelationships. "Chat rooms" became popular, particularly on AOL.There was little to no commercial exploration. In the few early retailexamples of this "unintelligent chat," customers could click a buttonto initiate a chat session. This version of chat was completely reactiveand offered little insight to the interests of the customer prior to theconversation. Businesses were unable to effectively monetize chatbecause conversations were generally tedious and long, due to lackof any process and structure. There were no chat tracks or best prac-tices to direct the conversations, and this "fly by the seat of yourpants" method yielded little benefit for consumers or businesses.

2002-2005 — Commercial application began to be ex-plored. Retail websites installed chat to answer sitevisitors' questions. Best practices were not devel-oped at the time and chat agents, and companies,were learning how to best serve visitors with chat.Commercial attempts were often unsuccessful be-cause agents were "winging it", and site visitors werenot yet accustomed to live interaction on retail web-sites. However, this "rule-based" version of chat wasan improvement., with the ability to automaticallymessage customers as they took predefined pathsthough a website. This advancement encouragedmore website visitors to engage in chat because theywere being invited to do so with personalized mes-sages. But, the medium had still not advanced farenough to realize its full potential, and the initial ex-citement over chat had died down due to less thanstellar results. Thus, causing only a small adoptionrate in B-to-C operations.

2006-Present — Online retail websites begin to ex-perience significant benefits from the now, moremature medium. Best practices and sophisticatedanalytics now allow commercial success with livechat. This third and most recent iteration of chatoffers "business intelligence interaction." The ear-lier versions of chat are combined and now includestatistical and behavioral modeling to know whichshoppers have the highest probability of convert-ing into leads. This new version revolutionizes on-line shoppers' experiences by providing the rightmessage, at just the right time during the shoppingexperiences. It is the most labor-intensive type ofchat, but is also clearly the most effective overallfor increasing customer satisfaction and lead gen-eration. Today's premium live chat services alsooffer targeting, behavioral intelligence and GeoIPtracking to increase overall business effectiveness.

Chat Failed to Live Up to the Hype in the Beginning of the Dot.Com Revolution


Dealerships lose sales opportunities every day by not engagingtheir website visitors. In a web 2.0 world, most dealership sites stilloffer only one-sided communication (website billboards) for visitors,and up to 99% of site visitors leave without submitting any contactor other information. Automotive dealership websites receive anaverage of 2,000 to 3,000 visitors per month. So it's very likely thatyour dealership is losing literally thousands of sales opportunitieson your website if it is static, with no way to directly engage sitevisitors in two-way communication. Proactive live chat is the onlytechnology so far that allows live connection through the samemedium with customers while they shop on your dealerships web-site. People on your website have questions and a lot of them needhelp. Are you prepared to help them?

Online, shoppers want instant gratification. They don't want tohave to wait or look too hard to find the information they seek. Ad-

ditionally, most of them do not want to have to stop what they'redoing to write and send an email or go pick up the phone and makea call to get answers to their questions. They expect to find whatthey're looking for quickly and easily, right from where they are,without changing mediums. Answering even simple questions onyour website lets you start the relationship earlier and lets you startguiding consumers through your dealership’s sales process funnel.As you know, a vehicle purchase is a big deal for most people, andall vehicle shoppers have questions that you can answer and useto begin building relationships. This is exactly where professionallive chat can help shoppers and your dealership.

Your Competition Isn’t Just Local Automotive Dealers Anymore

Another important concept to realize is that consumers do not differentiate between industries in their online retail experiences.They compare their experiences on your dealership website withthe experiences they have at other sites. So the website experienceyou provide them is being compared to the likes of Disney, Google,Amazon and Overstock, just to mention a few. If they cannot easilyfind and navigate your site, receiving the same high level of servicethey can get on these other sites, they will simply surf to anotherdealership’s website looking for the features that they are accus-tomed to online. Benchmarking your site with only your direct com-petitors is not wise because consumers are comparing you to theirglobal experiences, rather than industry-specific online interactions.

Is Your Dealership Losing 2,440Sale Opportunities Each Month?


Dealer websites are virtual representations of your physical dealer-ship. Make no mistake about it; consumers now see your websiteas your dealership. And yet, here is what happens in a typical sce-nario: A website visitor enters the site, clicks a few links and leavesthe site within minutes without taking any action.It is highly unlikely that a shopper would enter thephysical showroom, look around and not begreeted. But, it happens in your virtual showroomevery day. Five years ago, it was okay for dealersto merely have a website. Just being found on theweb was an advantage. As the Internet hasevolved, consumers’ expectations have evolved.And now, they increasingly expect live, instantservice and the ability to get additional informationwithout changing the medium. According to PaulSloan of Business 2.0, "For all the advantages thatcome with selling on the web, one disadvantagehas constrained online merchants: They haven'tbeen able to approach customers as they're shop-ping and pitch them on the spot." Used properly,live chat enables this interaction for your dealership.

Statistically, automotive shoppers visit dealership websites to geta better understanding of available inventory and pricing informa-tion, and also to find the store with which they want to do business.This is generally the consumer's first introduction to a dealershipand how they treat their customers. Therefore, it is crucial to startbuilding the relationship with your customers when they first visityour website. The average dealership website receives between

2,000 and 3,000 visitors per month. Of these visitors, an averageof one to three percent submit leads. This means that a dealershipwith 2,500 site visitors receives roughly 50 leads per month fromtheir website. According to NADA, 15% of these convert into ve-

hicle sales, meaning the average dealership is justover eight sales per month from website leads.

In addition, with the average vehicle sale gross of$2,000, the average dealership earns $16,000 permonth, or $192,000 per year from leads generatedthrough their own website. But what happened to theroughly 2,440 monthly website visitors that did notsubmit a lead or initiate further contact with your deal-ership? They are all lost sales opportunities withwould-be prospects that have the highest closingratio of all of your lead sources. These anonymoussite visitors represent money left on the table, so tospeak. Increasing your site’s visitor-to-lead ratio by50%, 75%,100% or more can potentially double thegross earned from your website lead sales. The av-erage $192,000 per year could easily become

$384,000, with minimal additional investment. Would you know-ingly leave an additional quarter of a million dollars in gross sittingon the table? The difficulty many dealers have had in the past wasthe inability to cost effectively increase website leads withoutspending more money at the top of the sales funnel driving moretraffic to your website. Chat acts as a net for your dealership’swebsite, collecting more leads as consumers pass through your ex-isting website.

Is Shopping for a Car Easy on YourWebsite? In the Eyes of Consumers,Your Website is Your Dealership.


In the earlier days of the Internet, people who visited websites forresearch and shopping tended to have different characteristics thanpeople who visited the showroom to research and shop for vehi-cles. Today, however, with up to 80% of automotive consumersconducting at least part of vehicle shopping online according to arecent Cobalt study, virtual and physical visitors are the same peo-ple. Live chat lets you “Meet & Greet” your customers on your web-site in a way that was not possible in the past. Offering betterservice on your website yields not only an increase in sales, butalso a boost in customer service and satisfaction. It really is justthat simple. When someone walks into your showroom, you im-mediately acknowledge them and let them know you are there tohelp. They may say they don't need any help, but you let themknow you're available, and they typically appreciate being recog-nized. Providing the same level of service on your website will gen-erate the same results.

Many dealers who tried early versions of live chat received little orno results. This was the result of a multitude of reasons. In thepast, customers didn’t know how to use chat, and neither did thebusinesses that were trying to use it to sell. The problem was thatmost earlier versions failed to address the key components neededfor successful live chat: planning, implementation, and ongoingmanagement and analysis. Today, however, automotive retail web-sites can reap the benefits of over ten years of live chat trial and re-search. A more scientific approach is now possible to maximizethe benefits of live chat to increase customer satisfaction and sales.Live chat has the power to turn anonymous website visitors intohighly qualified leads, complete with contact information, trade-indata and extended consumer information to set the stage for a bet-ter sales process when the customer finally walks into the dealer-ship showroom.

Live Chat Accelerates Leads and Sales forDealerships Across the Nation

Technological advances, and more than a decade's worth of trialand research, allow a new class of live chat service for dealershipwebsites. In addition, shoppers are not only more accustomed toengaging in chat, many are beginning to expect the option. Deal-erships can better serve and capitalize on previously anonymouswebsite visitors by engaging them in proactive two-way communi-cation while prospects are on the dealerships’ websites. Usedproperly, chat has the power to provide instant gratification to sitevisitors by answering their questions and helping them with any is-sues, and it creates a great first experience for the prospect withyour dealership. According to a recent CNNMoney.com article, "…[chat] continues to evolve. Now some savvy website operators arefinding that, when used tactfully, it can be a powerful way to boostsales - not just as a passive customer-service tool but as a way toengage customers, in the manner of a showroom salesperson."

Where Did all the Showroom Traffic Go? It’s Now Online.


Ultimately, successful live chat means that site visitors benefit from hav-ing the feature of chat. They have a better experience at the websitethan they would have without the feature. In the end, this generatesmore leads and sales. Research confirms that today's premier versionsare capable of this. Earthlink found that 15% of shoppers who interactwith chat ultimately buy services during their session. Furthermore, ac-cording to phplivesupport.com research, site visitors who use live chatare 20% more likely to buy than shoppers who do not chat. Even withvarying estimates, properly deployed and managed live chat can dra-matically increase leads and sales. Apple, Home Depot and Disney arejust a few of the major corporations that use live chat to successfullyengage website visitors on the retail Internet space.

A key reason for the increase in leads and sales from visitors who en-gage in chat is that smart dealers are using skilled chat agents that cancapture detailed information about the shoppers interests. Anothersuccess factor is the favorable first impression the dealership receivesfrom visitors who are proactively asked to chat at moments when theyare most likely to have questions or need help. Visitors who receivefast, helpful answers to questions stay longer, buy more products andhave more confidence in the dealership. It is an incredibly cost effectivemethod to begin building trust and a solid customer relationship withyour shoppers.

Today's live chat can also provide reporting to help you better under-stand your consumers, including:

• Referring URL

• Visitor’s hosting domain name

• Geographic location

• Entrance and exit point for the website

• Pages viewed during each visit

• Keywords used by prospects to reach the dealership website

• Previous visit dates and chat conversations

Further, the use of multiple languages for chat is also now availablefrom the most advance chat providers. Dealerships can now engagevisitors in their preferred language, providing a higher level of person-alization and convenience.

In addition to generating more revenue for dealerships, today's livechat can also save dealerships money. The average live-chat ses-sion costs about $4, compared to the $10 or more for the averagecustomer service phone call, according to Forrester Research.Dealers who can convert would-be phone calls into chats can savean average of $6 per conversation, a 60% decrease in cost. So, inaddition to increasing sales, chat can also help the dealership re-duce costs. Also note, a well equipped chat staff should captureinformation on at least 85% of the visitors who chat. Compare thatto what your salespeople capture on phone ups and you can seethat chat allows your dealership to capture more prospect informa-tion for better follow up, all at a lower cost.

For websites that best utilize chat, InternetRetailer.com estimatesthat 15% of web visitors accept proactive invitations to chat. Notethat statistic was for "proactive invitations." Sites that merely havea "click to chat" button yield far lower engagement rates. Proactivelive chat lets shoppers know that help is available to them rightthere, on the dealership website, just as it is at physical dealership.

Use Live Chat to Engage Your Website VisitorsHere are some Ideas to Increase Customer Satisfaction and Sales

• Offer an Exclusive Internet Offer• Co-browse with Visitors• Answer Questions• Help with Inventory Searches• Provide Vehicle Specials and Pricing• Provide Hours of Operation • Engage Site Visitors • Build Consumer Rapport that Leads to a Relationship• Help Schedule a Service Appointment• Help Schedule a Test Drive• Help Find that Special Part• Help Fill Out a Finance Form


Note the steps the chat agent took with theshopper. The chat engagement was proac-tive. The opening was friendly, not pushy,with an offer of assistance. The agent an-swered questions and supplied the re-quested information, while simultaneouslygetting the shopper's contact information.By the end of the short chat the dealershipnow had the full name, email address,phone number, vehicles of interest and fi-nancing information, all for an average of $4per chat. The dealership has begun build-ing a relationship with the shopper, and nowhas contact information and knows whatthey are interested in. Without the live chat,this visitor would most likely show up onlyin generic web traffic stats and not as ahighly qualified lead.

The Anatomy of Successful DealershipLive Chat: What Does it Look Like?

*Actual live chat transcript, with names changed for anonymity.

Example 1

*Hi, Welcome to Ben Taylor Acura, How can I assist you?

Christian says:Hello John. My name is Christian how can I help you?

John says:I am interested in a 2008 MDX. Is Acura providing promotional financing to purchase?

Christian says:Oh that's a great car. We have a wide variety of financing suited to all ranges ofcustomers.

John says:My question is whether Acura is providing promotional financing? My brother-in-law had purchased an MDX and at that time Acura gave 1.9% financing for up to 36 months. What is Acura providing currently?

Christian says:I can look into that immediately sir. Do you have an email I can forward the information to?

John says:yes, it is [email protected]. You can also e-mail pricing on a base mdx andmdx with technology package. Add as a separate line item sport running boardsand all weather mats. Thank you.

Christian says:And your full name sir? We like to be as professional as possible when dealingwith prospective clients.

John says:John Sellers

Christian says:Fantastic, Mr. Sellers. If you'd like to hasten the process, I can have a sales representative contact you very soon via telephone. Is there a number we canbest reach you at, sir?

John says:But just so I am clear I purchasing the car on behalf of a client. I can be reachedat 327-376-1383. Thank you.

Christian says:That's great sir. Well I'll send this to one of floor associates immediately. Have a wonderful day and I'll be sure they contact you very soon regarding the 2008 MDX.


Example 2

Hi, Welcome to Timothy Halpert BMW, How can I assist you?

Chris says:Hello Terry. My name is Chris how can I help you?

Terry says:questions about leasing.

Chris says:Sure! How can I help?

Terry says:I hear leasing is terrible cause you have mileage limits.

Chris says:Well, that would certainly depend on how much you drive, & whether or not the limit affects you.

Terry says:here in Miami we drive everywhere.

Terry says:can limits be adjusted?

Chris says:Sure, if you're concerned about going over the limit. That is something to consider.

Chris says:Well, there would probably be a fee for going over the limit.

Chris says:That is, your lease would include a certain number of miles, &if you exceeded, you'd be charged extra. Probably per mile.

Chris says:But that's something you would really need to examine before.

Chris says:There's plenty of wiggle room in working out leases.

Terry says:so the set miles cannot be adjusted, say to 15k rather than 10k?

Terry says:10k is not a lot.

Chris says:Again, it's possible, it would just depend on many factors.

Chris says:If you like, I can put you into contact with our sales managerwho can give you ALL the details. Far more than I can getinto here.

Terry says:can you trade in a car in a lease?

Chris says:That's certainly possible! What kind of car do you own?

Terry says:2000 'Mercedes c230

Chris says:Beauty, I bet!

Terry says:eh, its seen better days

Chris says:Terry, I want to give you the most info on this possible. Icould have my manager email you some general info onleases, if you like. What's the best email to reach you on?

Terry says:[email protected]

Chris says:Thanks! Did you want to leave a number, in case you needmore info?

Terry says:that's ok. not yet w/ the #. thanks for your time Chris.

Chris says:You're welcome, Terry! Could I have your last name before you go?

Terry says:Mulally.

Chris says:Thanks again, Terry. Consider that info sent!

Chris says:Have a great day!

Terry says:you too.

Four Step ConversionProcessEstablish Rapport

Steer the Conversation

Give Options

Provide Information

1234


Used properly, chat lets your dealership offer the same level of serv-ice provided at your physical dealership-- to an increasing numberof shoppers who might not make it to the bricks and mortar loca-tion. Live chat allows you to helpfully engage site visitors, capturevaluable information about them and move them into the salesprocess funnel. Industry estimates that dealers, on average, loseliterally thousands of sales opportunities each month from shopperswho abandon the dealership website without taking any action.You can now reach out to those consumers and offer a higher levelof service than your competitors. Shoppers will reward your onlineand interactive assistance with loyalty and sales. Dealers can easilydouble their Internet leads and sales using professional, proactivelive chat. In addition to increasing revenue, chat can save the deal-ership money by offering a more cost effective alternative to ex-pensive phone calls. To successfully leverage this potential bestpractices must be understood and followed, and the needed re-sources must be dedicated to effectively maximize chat opportu-nities and results. Merely adding the technology to the website willnot produce results. And finally, chat agents need to be dedicatedand skilled in medium’s unique characteristics.

Coming soon:

The next eBook that discusses what to look for in live chat serviceproviders to make sure your dealership reaps maximum benefits.

To Sum It Up

About ActivEngage(www.ActivEngage.com)

ActivEngage’s proprietary business logic was designed in

dealerships to meet the needs of sophisticated automotive

shoppers. It laser targets each website visitor with the

exact right message at the exact right time to get them to

take action. It works because the company founders have

over 30 years of retail automotive and technology experi-

ence, giving ActivEngage a true 360° understanding of the

needs of automotive shoppers. Partnering with ActivEn-

gage increases lead generation and offsets the increasing

marketing costs associated with the sale of new and pre-

owned automobiles. ActivEngage offers three tiers of serv-

ice to ensure that all website visitors' experiences are

enjoyable and uncomplicated, thereby increasing the value

of dealership websites through better lead generation.

Contact ActivEngage to learn more about live chat

and your dealership!

Phone: (800) 775-7358 • Email: [email protected]


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Seven Reasons Live Chat Fails

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