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Evaluating The Potential For Mobile Chat To Drive eBusiness Goalsby Diane Clarkson, April 25, 2012

FOR: eBusiness & Channel strategy Professionals

Key TaKeaWays

Mobile Chat eBusiness Benefi ts Mirror Those of Website ChatTh ese are early days for mobile chat. eBusiness leaders should be evaluating chat in their mobile strategy. Mobile chat can achieve the same proven eBusiness benefi ts of website chat, including driving engagement, supporting sales by off ering live assistance when a customer needs help, enhancing customer satisfaction, and improving effi ciency.

There are Compelling indicators That Consumers Will adopt Mobile ChatWebsite chat adoption has doubled in the past two years and now has the highest customer satisfaction rating among online service channels. Mobile chat will allow consumers to engage with brands on the device of their choice. Th is will be increasingly important to reach younger consumers and consumers in emerging markets.

successful Mobile Chat implementations Will accommodate unique aspects of The ChannelOperationally, mobile chat is very similar to website chat. However, the smaller screen creates unique aspects that eBusiness leaders must consider for a successful mobile chat implementation, including canned answers, queuing strategy, and agent training.

© 2012, 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 EBUsInEss & ChAnnEl sTRATEgy PROFEssIOnAls

Why Read This RepoRT

In the early years of the Internet, online customer service involved the marketing departments writing content for a handful of online FAQs and including a telephone number in the “contact us” section. Today, we look back at that naiveté with amusement. At the same time, we risk doing the same again with mobile strategies. Chat has demonstrated its ability to enhance service, support sales, and improve customer satisfaction. This report will help eBusiness leaders evaluate the potential for mobile chat to drive their goals.

Table Of Contents

Mobile Chat offers potential Benefits To Both Business and Consumers

Mobile Chat Can support eBusiness goals

Mobile Chat Can significantly Enhance Mobile Customer Experiences

Mobile Chat implementation Requires a Robust Mobile strategy

Weigh Mobile Chat Technology Options Against The User Experience And ROI

Mobile Chat Operations Mirror Website Chat But With some Key Distinctions

WhAT IT MEAns

Mobile Chat Will have a Compelling impact on Mobile support

supplemental Material

notes & Resources

Forrester interviewed four vendors, including Bold software, livePerson, netop, and Oracle.

Related Research Documents

Mobile Mandate For eBusiness Professionalsnovember 16, 2011

Mobile Commerce Forecast: 2011 To 2016June 17, 2011

Extending Online Customer service To The Mobile Channelseptember 9, 2010

evaluating The potential For Mobile Chat To drive eBusiness Goalsby Diane Clarksonwith Zia Daniell Wigder and lily Varon

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Evaluating The Potential For Mobile Chat To Drive eBusiness goals 2

© 2012, Forrester Research, Inc. Reproduction Prohibited April 25, 2012

MoBile ChaT oFFeRs poTenTial BeneFiTs To BoTh Business and ConsuMeRs

Website chat has demonstrated its ability to drive eBusiness goals and now has the highest customer satisfaction rating among online support channels.1 While these are early days for mobile chat, savvy eBusiness professionals are asking: Where should chat be in our mobile customer service strategy?

Mobile Chat Can support eBusiness Goals

According to Ethan Alexander, vice president of mobile at LivePerson, “If you aren’t engaging your customers in every channel possible, you’re missing out on sales, support, brand, and engagement.” Mobile chat has the potential to support these critical eBusiness goals by:

■ Driving engagement by facilitating a live interaction with support or experts. eBusiness leaders recognize that engagement is critical to building long-term relationships with consumers on mobile devices. In Forrester’s recent Q4 2011 Global Mobile Maturity Online Survey, 53% of respondents listed increasing customer engagement among the top three goals of their mobile strategy.2 Mobile chat can offer a live interaction with support reps or product experts from a mobile website or within an app. This interaction can elevate a mobile experience into a truly engaging live interaction with a brand.

■ Supporting sales by offering live assistance when a customer needs help. While mobile commerce represents a relatively small piece of the eCommerce pie today at 2%, Forrester forecasts that it will reach $31 billion by 2016.3 US retailers want a piece of this pie: Some 83% of US retailers say that the goal of their mobile websites and apps is to drive online sales.4 Consider the history of chat’s corporate goals on websites. Chat was introduced most frequently as a call deflection channel; eBusiness leaders quickly saw its potential to drive sales by expanding the reach of sales support. Aveda is an early adopter of mobile chat; its goals include supporting sales by facilitating mobile chats to gain product recommendations from experts (see Figure 1).

■ Enhancing customer satisfaction by meeting customers’ desire for mobile support channels. Thirty-seven percent of US online consumers agree with the statement “I would like to have the same level of online customer service function on my mobile device as on my PC or laptop” (see Figure 2). This sentiment is particularly pronounced among consumers ages 18 to 32. In today’s world of multichannel, multidevice customer expectations, a gap between the online customer service functionality on a website and that on a mobile offering will be increasingly unsatisfying.

■ Achieving operational benefits through concurrency. Because a mobile chat can come through to the contact center just like a website chat, it can leverage the same operational benefits. Concurrent chat rates can achieve a lower cost per contact compared with the telephone. Concurrent chats can also allow organizations to manage peaks of inbound communication. For example, an airline could manage a travel disruption faster and more cost effectively via mobile chat than via telephone.




■ Expanding the reach of live help globally. Emerging markets are driving growing adoption of the mobile Internet. Forrester forecasts that there will be more mobile Internet users globally than PC-based Internet users in 2016.5 Mobile chat can expand the opportunity to offer live help in key emerging markets, including Latin America and Asia Pacific, where consumers will increasingly be more likely to access the Internet via their mobile devices than through a PC.

Mobile Chat Can significantly enhance Mobile Customer experiences

It may seem an obvious question: Why would a consumer want to engage in chat on a mobile phone instead of simply telephoning? But consider the following:

■ Speaking to a contact center rep is not always the preferred channel. The availability of a telephone function doesn’t mean that the telephone is the preferred way to contact a company for support on a mobile device. Generations X and Y (consumers ages 23 to 45) are equally likely to prefer online support over support via the telephone. Generations X and Z show higher satisfaction rates for chatting with a live agent than for speaking on the telephone with a live agent.6

■ Mobile chat may be more convenient than using the telephone. There are many reasons a consumer may choose to contact an organization to chat on a mobile device: It could be on impulse; it could be more convenient; it could simply be a preferred channel. The US Air Force extends its reach to allow potential recruits the option to chat with a recruiter through the organization’s mobile website (see Figure 3). In addition, mobile chat could offer a level of privacy that a telephone conversation may not afford. For example, consumers may prefer to use mobile chat to discuss private concerns, such as seeking health information or communicating with their financial services organization.

■ There is demonstrated interest in using mobile devices to contact support via text message. Twenty percent of US online consumers used SMS text messaging to contact customer support in 2011.7 This mobile channel is particularly appealing to younger generations: Approximately one in three consumers who were 31 or younger opted to skip the telephone and send a SMS message to a company requesting assistance.8 While SMS is asynchronous in nature, mobile chat offers a potentially more robust support conversation.




Figure 1 Aveda’s Mobile App Offers Live Mobile Chat With An Expert

Source: Forrester Research, Inc.72724

Source: Aveda iPhone app




Figure 2 Consumers Want Mobile Service Functionality To Match That Of Websites


“I would like to have the same level of online customer servicefunction on my mobile device as on my PC or laptop.”

Source: North American Technographics® Customer Experience Online Survey, Q4 2011 (US)

The spreadsheet associated with this figure contains additional data.

Gen Z (18-22)

Gen Y (23-31)

Gen X (32-45)

Younger Boomers (46-55)

Older Boomers (56-66)

Golden Generation (67+)

All

46%

47%

40%

32%

27%

24%

37%

Base: US online consumers

(4 and 5 on a scale of 1 [do not agree] to 5 [agree strongly])




Figure 3 The US Air Force’s Mobile Website Offers Live Mobile Chat With A Recruiter


Source: US Air Force mobile site

MoBile ChaT iMpleMenTaTion RequiRes a RoBusT MoBile sTRaTeGy

Forrester believes that immediacy, simplicity, and context are the three key benefits crucial to delivering the mobile services that will drive eBusiness goals.9 Mobile chat can significantly enhance these benefits. But adding mobile chat to a non-mobile-enabled website is a waste of resources. Mobile chat will be successful when it is deployed within a robust mobile strategy that can identify chat objectives and success metrics.

Weigh Mobile Chat Technology options against The user experience and Roi

To describe mobile technology as complex is an understatement. There are different nuances to operating systems, which also can vary from country to country. The complexity is further deepened by variations among mobile devices themselves. Organizations considering mobile chat will face several technology options. eBusiness leaders must weigh the following technology considerations against how they will affect the user experience and potential ROI:




■ SMS texting is asynchronous but has merit. There is debate in the chat vendor community as to whether SMS texting should be considered chat. Forrester interprets synchronous real-time conversation to be the hallmark of chat. An SMS text is an asynchronous communication. Because it does not take place in real time, the user can’t see if and when a response will follow. As a result, it does not lend itself as easily to a customer support conversation. However, SMS has merit. It is relatively easy to deploy and is a channel with which customers are familiar. Links or photos can easily be shared via SMS. The technology has proven to be very successful for alerts, and many industries deploy it, including airlines, restaurants, and transit companies. Vendors including Bold Software have an SMS module.

■ An “out of the box” solution is a good starting place for mobile chat. Out-of-the-box solutions are mobile-optimized for a smartphone form factor; for example, they feature larger buttons to initiate a chat rather than a mouse click. These offer a templated approach in which you can customize features, such as a dynamic chat button or site branding considerations. Vendors including LivePerson and Oracle’s RightNow offer these solutions for a wide range of mobile devices. Netop currently offers mobile support for BlackBerry and other non-Apple mobile phones that support Flash.

■ Build-your-own mobile chat offers the most customization but requires the most expertise. This option facilitates building a mobile chat capability that is configurable and customizable. This approach lends itself to organizations with strong mobile development teams or outsourced partners. Its most frequent use case is building a native application. Chat vendors including LivePerson and Oracle’s RightNow have APIs that allow you to build your own mobile chat.

Mobile Chat operations Mirror Website Chat But With some Key distinctions

Operationally, mobile chat mirrors website chat. It can be deployed proactively or reactively. It can integrate into back-end systems, knowledge bases, and agent desktops. Anecdotally, live chat vendors have observed that there is currently little difference between the drivers for mobile chat and for website chat. At the same time, a mobile device offers a different user experience for chat compared with a website. A successful mobile chat deployment will incorporate its unique requirements by:

■ Accommodating the device experience with shorter answers. Screen real estate on a mobile device is fundamentally different than on a website. The smaller device screen means longer answers will compromise the user experience by requiring scrolling. Instead, canned responses in a mobile chat session should be shortened.

■ Avoiding content that is not conducive to mobile devices. It is common in a website chat to include hyperlinks and to page push by sending the consumer’s computer screen to various website pages during the chat session. However, given the restraints of the device, it is not a best practice to include this content in a mobile chat.




■ Queuing mobile chats as priorities. Leading chat vendors have observed that consumers are less willing to wait for a mobile chat. Agent desktops should indicate if a chat is coming in on a website or mobile device and prioritize mobile chat. This indicator will also allow the chat rep to select the transcript or canned answers that are appropriate for a mobile device.

■ Training contact center reps for mobile chat. Mobile websites and apps will likely have content and navigation that varies from that of the website. Contact center reps will need to be very familiar with these differences because they could affect the conversation flow. Mobile chat vendors have observed that the smaller mobile screen size and resulting shorter sentences lead to a conversation that could be interpreted as having a terse tone. Additionally, consumers are more likely to make spelling mistakes in a mobile chat. Chat reps’ training should include practice sessions with mobile chat to be comfortable in this milieu.

w h at i t m e a n s

MoBile ChaT Will have a CoMpellinG iMpaCT on MoBile suppoRT

Website chat has revolutionized how customers and eBusinesses engage with one another, and it has quickly grown into one of the most satisfying channels among online customer service options. Mobile chat can do the same for mobile offerings. Today’s innovative mobile features offer consumers wide-ranging functionality, such as making access to reviews and product specs as easy as scanning a QR code, turning passive catalogs into interactive style guides, and proactively sending mobile coupons. Mobile chat will increasingly enhance these mobile offerings, making them even more interactive and engaging while also supporting revenue goals. Savvy eBusiness leaders — particularly those with or considering a website chat implementation — are evaluating where mobile chat fits into their mobile strategy now. Mobile chat will be an engaging differentiator in the short term. It will become a key part of an engagement and support strategy in the future.

suppleMenTal MaTeRial

Methodology

Forrester conducted the North American Technographics® Customer Experience Online Survey, Q4 2011 (US) in October 2011 of 7,638 US individuals ages 18 to 88. For results based on a randomly chosen sample of this size (N = 7,638), there is 95% confidence that the results have a statistical precision of plus or minus 1.12% of what they would be if the entire population of US online individuals ages 18 and older had been surveyed. Forrester weighted the data by age, gender, income, broadband adoption, and region to demographically represent the adult US online population. The survey sample size, when weighted, was 7,637. (Note: Weighted sample sizes can be different from the actual number of respondents to account for individuals generally underrepresented in




online panels.) Please note that this was an online survey. Respondents who participate in online surveys have in general more experience with the Internet and feel more comfortable transacting online. The data is weighted to be representative for the total online population on the weighting targets mentioned, but this sample bias may produce results that differ from Forrester’s offline benchmark survey. The sample was drawn from members of MarketTools’ online panel, and respondents were motivated by receiving points that can be redeemed for a reward. The sample provided by MarketTools is not a random sample. While individuals have been randomly sampled from MarketTools’ panel for this particular survey, they have previously chosen to take part in the MarketTools online panel.

Companies interviewed For This Report

Bold Software

LivePerson

Netop

Oracle

endnoTes1 Website chat adoption has nearly doubled in the past two years; at 62%, it has the highest satisfaction rating

among all online customer support channels. In fact, Generations Z and X have higher satisfaction chatting with a live agent than speaking on the telephone with a live agent. See the January 23, 2012, “Understanding Customer Service Satisfaction To Inform Your 2012 eBusiness Strategy” report.

2 When respondents were asked for their top three objectives when developing mobile services, 53% said increasing customer engagement and 39% said satisfaction were their primary goals. See the February 9, 2012, “2012 Mobile Trends For eBusiness Professionals” report.

3 Mobile commerce is expected to reach $31 billion by 2016. While this represents a compound annual growth rate of 39% from 2011 to 2016, mobile commerce is only expected to be 7% of overall eCommerce sales by 2016. See the June 17, 2011, “Mobile Commerce Forecast: 2011 To 2016” report.

4 Source: “The State of Retailing Online 2011,” a Shop.org research survey conducted by Forrester Research.

5 Source: Susan Huynh, “Mobile Internet Users Will Soon Surpass PC Internet Users Globally,” Susan Huynh’s Blog For Market Insights Professionals, February 21, 2012. For more information, see the February 13, 2012,

“Forrester Research World Mobile Adoption Forecast, 2011 To 2016 (Global)” report.

6 Many eBusiness leaders cite expanding future online customer service offering as a tactic to appeal to their youthful customers. It is true that 37% of consumers ages 18 to 22 prefer online customer service to the telephone. But don’t assume that a preference for online service over the telephone is restricted to youth; in fact, Generations X and Y (consumers ages 23 to 45) are equally likely to prefer online support over the telephone. Savvy eBusiness leaders recognize that developing online customer support channels isn’t a tactic to build future relationships with today’s younger customers; online customer service is imperative to appeal to the majority of today’s online shoppers. See the January 23, 2012, “Understanding Customer Service Satisfaction To Inform Your 2012 eBusiness Strategy” report.











7 Source: North American Technographics Customer Experience Online Survey, Q4 2011 (US).

8 Online consumers’ preferences for online customer service channels are evolving. More online consumers have adopted online self-service in the past two years; it has also disappointed more consumers. Consumer adoption of chat and social customer support has exploded in the past two years. Not all channels are equal among generations: For example, younger generations are more likely to prefer chat over the telephone and use social media for support. But a preference of online customer service is not the domain of youth. Savvy eBusiness leaders recognize that developing online customer support channels isn’t a tactic to build future relationships with today’s younger customers; online customer service is imperative to appeal to the majority of today’s online shoppers. See the January 23, 2012, “Understanding Customer Service Satisfaction To Inform Your 2012 eBusiness Strategy” report.

9 Immediacy delivers content when consumers need it most. Simplicity removes usability barriers, making mobile invisible to users. Context makes content relevant to the individual. See the July 11, 2011, “eBusiness: The Future Of Mobile Is User Context” report.





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