January 2009 - Feature: Let’s Chat

What is live chat’s new ROI? Return on invitations. Here are six best practices for implementing proactive chat.

By Steve Castro-Miller
Live chat has proven itself in the support world by providing fast return on investment through easily achieved agent efficiencies. While the technology is still climbing the adoption curve, it’s plain that support staff can only speak to one person at a time on the phone and, that live chat knows no such boundaries. Although there is still ground to cover in the opt-in world of passive chat, the new frontier in web-based customer engagement technology lies within a more dynamic discipline-the optimization of invitation-driven chats.

For those already experienced with live chat solutions, it will come as no surprise that I do not recommend beginning immediately with a proactive chat implementation. To deliver positive results with such a technology, it is wise to establish a foundation using reactive chatting first. That’s not to say companies can’t move quickly, because they can. The following six-phase implementation plan can be accomplished in about eight weeks. (See timeline below)


The old adage about an ounce of planning and a pound of cure is certainly true when it comes to a live chat installation. Haphazard implementations have little chance to deliver successful results and can even be detrimental to customer satisfaction. A minimal amount of analysis and planning can make the difference between a best-in-class install and an amateur one. Some of the items to consider during this phase include:

  • Desired chat volume
  • Chat button placement
  • Customizations/canned message development
  • Staffing

Determining chat throughput - I think it’s important to dispel a live chat myth: placing a chat button on your website will not generate more traffic to your website.
While this seems a pedantic observation, it is an important variable when calculating your organization’s desired chat volume. Equally important is this live chat truth: there are people who visit your site today who don’t call, who don’t e-mail, but will chat.

In my experience, there is a population of website traffic that prefers using chat as a communication mechanism. The number of chats you are likely to get will depend not only on your website’s daily traffic, but also on factors including the nature of your product or service, the demographic profile of your visitors, and so on.

Chat-button placement - Button placement involves a series of tradeoffs between traffic maximization and quality control. To maximize the number of chat requests, you’ll want to place the chat button prominently on well-trafficked pages. The higher the button is on the page, the more chats you’re likely to get. However, many companies wish to be more discriminating about the kinds of chats in which they wish to engage.

Using a site’s traffic analytics, you can determine chat-button placement by identifying, for example:

  • Site areas or pages with the highest conversions;
  • Top exit pages;
  • Funnel abandonment pages;
  • Product pages where chats are likely to increase upsell opportunities;
  • Complex product or services pages;
  • Checkout pages; and
  • Error pages.

Customizations and canned message development - Phase I should also include the engagement of graphic designers (either internal or external) in order to ensure the proper branding of chat buttons and windows. Many chat solutions provide a standard set of buttons out of the box. While these are excellent options for smaller businesses, larger scale implementations are advised to tightly integrate the look of the chat capability into their overall site design.

Plan to develop your first set of canned messages during Phase I, as well. Canned messages make chat operators immediately efficient. For sales-focused canned messages, I recommend creating two versions and split-testing them.

Staffing - Under the “Determining Chat Throughput” section above, I discussed some general guidelines to follow with regard to the number of people it will take to support a live chat implementation. Here, though, I want to make a different point. Many people worry about having enough people to handle the communication volume created by a live chat product. I prefer to think of live chat, especially one intentioned for proactive chats, as a new sales channel. Filtering one’s thinking in this way makes chat volume seem less like a burden to be handled and more like an opportunity to be welcomed.


There are several reasons I recommend that you start with the implementation of reactive or opt-in chat:

  • It allows chat operators the opportunity to familiarize themselves with the application. While many offerings include an incredibly intuitive interface, it is best to launch a proactive program with experienced operators;
  • It enables you to establish a baseline against which proactive chat’s efficacy can be measured; and
  • It helps you determine the chat volume your organization can handle.

Many live chat solutions include a “Chat not available” button; however, when you first implement, I don’t recommend using this button. If you want to gather data about when people want to chat with you, use the normal chat button all the time. Reporting in later weeks will inform you about whether or not you’re appropriately staffing your chat implementation.

During Phase II, it is also important that you implement an integrated visitor monitoring and conversion tracking solution. Some live chat offerings provide these features out-of-the box, and I highly recommend utilizing them. A chat implementation unlinked to real-time visitor and conversion metrics is not robust enough to support a successful proactive program.


After approximately a week, depending on your website’s traffic, you’ll have generated enough data from your implementation to be able to make significant enhancements to your chat processes.

Some of the baseline metrics you’ll want to keep in mind are:

  • Overall chat traffic
  • Conversions resulting from chats (overall and by operator)
  • Average message count
  • Total chat time
  • Average speed of answer
  • Operator availability

You’ll want to establish a set of regular reports to be delivered automatically to key personnel involved in the chat operation. The reports should include, at least, a granular view of the information cited above. At this time, you may begin to understand optimal staffing. If enough data has been collected, you can implement an “Unavailable” chat button at this time, as well.

Another tip: review individual chats from the first week and look for opportunities to create canned messages. It will not take long to find a healthy list of common questions for which no canned message currently exists. Implementing new canned messages delivers an immediate efficiency improvement, boosts operator confidence, and helps to ensure a consistent on-site experience for visitors.


By now, you’ll be adept at predicting chat volume, your operators are comfortable interacting with website visitors, and a regular set of baseline reports is established. The foundation for proactive chat is now in place.

Given what you know about chat’s impact on your business thus far, companies should decide on what goals they wish to accomplish using a proactive invitation engine. Some common goal areas are:

  • Increase cross-sells for specific product pairs;
  • Increase sales conversions for high- margin product SKUs;
  • Increase the number of upsell opportunities;
  • For a particular sales funnel, increase the value per transaction;
  • Increase customer satisfaction metrics;
  • Decrease the number of funnel bailouts;
  • Increase sales conversions for visitors who arrive on-site through PPC campaigns; and
  • Increase chat traffic during operator idle time.

I recommend two things in this area. First, write down the goals so that everyone in your organization understands the rationale behind using proactive chats. Second, keep goals focused; casting wide goals like “increase sales” are too general to be effective.

This phase also involves making some calculations with regard to current chat volume and expected chat volume after proactive implementation.

To approximate the total increase in chat traffic that proactive invitations can yield, calculate the total number of website visitors during your reactive chat implementation that did not e-mail, call or chat with you. This represents the raw number of people who might chat with you if you proactively invited them. In my experience, visitors who will behave in ways that make them targets for invites range from 5 percent to 15 percent of this traffic. Further, the take rate for invitations averages around 10 percent to 20 percent. Don’t worry if you initially experience low take rates. Over time, using the best practices I’ve discussed, you’ll see marked improvement.


I recommend a three-step process to effectively utilize proactive invitations. The process may seem awkward because each element is interconnected to each of the other two; when one gear turns, so do the others. Proactive chat implementations require a scientific methodology that not only considers each of the elements in isolation, but also considers them working and interacting together.

What’s the placement? By far the most complex factor of the three is determining where on the website to offer a chat invitation. Depending on your website’s traffic and the goals you’ve set out in the previous phase, you may want to invite broadly or with specificity. In any case, I recommend you perform a thorough analysis using a variety of inputs, including:

  • Chat launch history - From where on the site do desirable prospects launch opt-in chats today?
  • Landing pages & referring pages - Are there specific landing or referring pages that appear aligned with the prospects you want to chat with?
  • Key site pages - Do you have existing pages on your site that attract your target chat-prospects?
  • Funnel abandonment - Are there particular pages that suffer from high abandonment?

What’s the message? Poorly crafted messaging in your invitation can cause a double-deviation by not only preventing a chat from occurring, but it could also shorten your visitor’s overall time on-site. What typically works best is messaging that strikes a balance between exactness and generality. Live chat solutions should provide the necessary data to, for example, craft an invitation that says, “I see that you’re from Illinois and just searched for red shirts on sale through Google. We have red shirts!” This invitation, while impressive to some, leaves most of the population feeling vulnerable. Resist the temptation to use this powerful information directly with prospects. Instead, craft messages that make use of the data in more subtle ways. For example: “Could I tell you about some of our sale items this week? We have blue jeans, colored shirts and shorts…” Avoid the direct and ineffective, “May I help you?”

What’s the timing? There are three factors involved when deciding when to issue an invitation:

  • The total page views of the visitor
  • The total time on-site of the visitor
  • The total time on the current invite-target page

Use website analytics data to set the last variable above. At first, try setting the invite time just below the average time on page metric for the target. After a sufficient number of invites have been accepted (50-100), try setting the time to beyond the average time on page and see what impact it has on conversions.


The first week or two after implementing proactive invitations, utilize your baseline reports in order to gauge the impact that your new program is having.

Additionally, you should add several new reports that can provide information on each invitation’s offer and take rate. You’ll want to make adjustments to each of the factors in Phase V, and I’ve found that the most productive tweaks to make are as follows (in priority order):

  • Timing - Believe it or not, the variety of time-related factors can have tremendous impact on your invitation acceptance rate. In one customer’s case, I changed a timing variable by 40 seconds and saw take rates increase from 3 percent to over 20 percent.
  • Placement - The next best place to target for optimization is to ensure that you’re inviting in the right places on your site. Experiment with different pages and with different page combinations.

Like any other marketing or sales program, the proactive invitations facilitated by live chat technology require fastidious management and testing. After you reach optimal levels of both timing and placement, you’ll want to turn to the invitations themselves. The look and feel, as well as the messaging associated with invitations, can be thought of as being similar to pay-per-click copy. As such, you’ll want to split test the invitations. While it’s possible to manually execute such a test, it’s not recommended. You’ll want to ensure that your chat invitation engine can serve multiple invites per rule set.

It doesn’t matter if you’re new to live chat technology or have been a user for some time. Hopefully after reading this, you’ll be convinced that the solution is no longer just a cost-saving tool, but an integral part of best-in-class Internet sales and marketing strategies. While proactive chat invitations are certainly driving the new ROI, it’s just the beginning.

Steve Castro-Miller is president of Bravestorm in Wichita, Kan., and can be reached at [email protected].

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