The Connecting with Customers Report. A Global Study of the Drivers of a Successful Online Experience
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1 The Connecting with Customers Report A Global Study of the Drivers of a Successful Online Experience November 2013
2 Executive summary LivePerson (NASDAQ: LPSN), a leader in online customer engagement, commissioned Loudhouse to conduct its second annual Connecting with Customers research in order to identify the trends in consumer behavior and expectations when it comes to the digital experience. The research measures the extent to which consumers are satisfied with their digital experiences today, and the specific technologies and innovations that improve their online journey. The study focuses on identifying the factors that are essential to delivering an exceptional digital experience. The findings show that if brands deliver a positive digital experience, the results extend far beyond a successful purchase or transaction, and create a greater opportunity to build strong and long-lasting customer relationships, translating to greater revenue and brand value for businesses. The study also demonstrates that today s digital consumers have very specific needs and high expectations when it comes to their online experience. They want their questions and issues resolved simply, quickly and within a single transaction. The research also reveals there is much opportunity for improvement among brands to deliver a stronger, more effective online experience, since today s consumers remain largely disappointed by the interactions they have with brands online. This dissatisfaction can result in lost revenue, reduced brand trust and the erosion of a brand s reputation. As we shift to a world where more and more activities, including banking, shopping, booking travel and more, are conducted online or via mobile, and with one in five (19%) consumers spending half or more of their expenditure online, providing the connected customer with an digital experience has never been more critical. Research methodology 6,054 online interviews were conducted with adults aged who make an online purchase at least once a month. Interviews were carried out across UK, France, Germany, Italy, Japan, USA and Australia during September Research was conducted by Loudhouse, an independent research agency based in London. Figure A: Sample sizes Figure B: Age 20% 21% 19% 20% 20% UK FRANCE GERMANY ITALY JAPAN USA AUSTRALIA TOTAL INTERVIEWS INTERVIEWS INTERVIEWS INTERVIEWS INTERVIEWS INTERVIEWS INTERVIEWS INTERVIEWS Figure B: Number of online purchases in a typical month Heavy 1% 10% 21% 12% 19% 37% Light years years years years years Once More than 10 Don t know Medium LivePerson,
3 Key research findings The research findings point to four major themes: Room for improvement Brands today cannot afford to deliver only the basics when it comes to the online experience. Consumers are quick to look elsewhere when they feel that expectations are not being met. Over half (58%) say they have not had an issue resolved in a single interaction, and 58% say they have ed a company and not received a response Brand trust and loyalty Every interaction with a brand is a defining moment it can either drive customer loyalty, or on the contrary, lead to abandonment to a competitor. The repercussions of a negative digital experience have never been higher, and the result of a positive experience is becoming increasingly more valuable. A positive online experience is the leading factor in customers completing their purchase (84%), buying from the company again (84%) and trusting the brand (84%) Most consumers agree that they are more likely to be loyal to companies that give them a great experience and service online (78%) When help is needed, live chat makes both the overall digital experience (88%) and perception of the company (89%) better The result of a poor online interaction with a brand is abandonment of the transaction (45%), a negative perception of the company (45%), loss of trust (43%), and loss of a customer to an alternative website (41%) Speed and efficiency It s no surprise that consumers want to reach their goal online in the fastest and most convenient way possible. The window of expectation for timely assistance is only growing narrower. Online consumers want access to real-time help in an average of 76 seconds or else they will seek alternatives away from your site Over three-quarters (77%) agree that when they re online, they want to get things done as quickly as possible Moments that matter most While consumers are growing increasingly adept and self-sufficient online, identifying the key moments where they may require support during their digital journey is proving to be essential. The most common occasions for needing help with a website are having a question about a specific product/service (42%), trouble making a purchase (35%) or post-purchase queries (35%) Three-quarters (74%) say that they chose one website over another due to the ease of browsing and searching. Secondary reasons are previous positive experiences on the website (64%) and availability of customer ratings/reviews (50%) LivePerson,
4 Brand trust and loyalty 84% of online users say brand trust is a primary result of a positive online experience Today s consumers rely on digital channels to help them complete important daily tasks, such as paying bills, shopping and even work-related tasks, and they need to understand that the brands they engage with are with them every step of the way. Engagement expectations are growing, as two-thirds (66%) of online consumers in the research state that they would like more choice in how they can contact brands online. When this study was conducted in 2012, this figure was just 59%. Offering multiple channels of contact influences consumer spend: 63% prefer to buy products and services from a company that offers multiple ways to connect with them. Consumers also want to be able to engage with brands on the go. Gone are the days of the desktop, with consumers spending an average of 63% of their time online on a mobile/tablet or laptop (See Figure 1). Figure 1: Average (mean) proportion of time spent accessing the internet 8% 14% 37% Desktop computer / PC Laptop Tablet (e.g. ipad) Smartphone We live in a world where products and services are rapidly being commoditized, and customer experience is becoming the true differentiator. This is hugely important since brands that deliver a positive online experience lead when it comes to brand trust, financial gain and loyalty. On the other hand, the risks of not meeting consumer expectations can be devastating for a company s reputation and bottom line. The implications are far-reaching. 84% of online users say brand trust is a result of a positive online experience. In addition, the vast majority say that a positive online experience makes it more likely for them to complete the purchase with the company (84%) and to buy from a company again (84%) See Figure 2. Figure 2: The effect of a positive online experience (% more likely) 84% 84% 84% 82% 76% 50% To trust the company / brand To buy from that company in the future To complete the purchase with that company To have a better perception of the company To recommend the company to someone else To mention the company positively on social media 41% LivePerson,
5 As shown in Figure 3, among online consumers who have had a poor online experience with a brand, nearly half say that as a result they had a more negative perception of the company (45%), they abandoned the transaction (45%) or they lost trust in the brand (43%). No matter how savvy consumers become in navigating the digital world, there are still times when it is critical to have live, human assistance to help them reach their goal. The use of sophisticated digital engagement tools such as live chat, video chat, and other real-time online solutions enables brands to deliver that live, human assistance at key moments, and becomes important when it comes to delivering a positive brand experience. Figure 3: Impact of bad experience online (Base: Those who have had a bad experience online) 45% 45% 43% 41% 41% 32% 28% 11% 8% I had a worse perception of the company I abandoned the purchase/transaction I lost trust in the company / brand I went to an alternative website I didn't buy from or use that company again I felt unvalued by the company I complained to someone about it offline I made negative comments about the company on social media None of these When examining what causes customers to bounce or abandon, the research looked to the main reasons for visiting one website over another and found that ease of browsing and searching (74%) is the number one factor (See Figure 4). When a customer needs help on a website, the vast majority of online consumers agree that live chat makes an overall digital experience better (88%) and it also improves the brand perception of a company (89%). Therefore, identifying the point at which real-time help is needed and proactively engaging consumers before they are stuck can drive significant value for a company. These are the scenarios that matter most for brands: high impact scenarios. Figure 4: Reasons for choosing one website over another 74% 64% 50% 44% 37% 21% 14% 11% 2% 2% Ease of browsing / searching A previous positive experience on the website Customer ratings and reviews Recommended by trusted sources Personalized experience and offers Access to real-time support online via live chat Website optimized for mobile devices Media tools such as how-to videos, product demos for products and services Other None of the above LivePerson,
6 Moments that matter most 35% of consumers say help or support is needed most at the point of purchase For brands seeking to improve the digital experience they deliver to consumers, the array of possible actions can be overwhelming. However, the research findings identify those critical moments where a transaction or customer can be won or lost during the digital journey, thereby prioritizing an organization s focus on their digital assets and their digital engagement strategy. Throughout the digital journey, there are particular points when consumers are more likely to need help or guidance to reach their goal (see Figure 5). How do consumers want to be engaged during these critical moments? According to the research, nearly half (47%) report having engaged with live chat in the past 12 months and state that this is the preferred channel of contact over telephone and (41%) when having trouble making a purchase. Both live chat and telephone are favored for time-sensitive scenarios such as difficulty making a purchase. Figure 5: Stages where assistance is most needed 45% 40% 35% 42% 35% in order of the buying process 35% 30% 25% 20% 26% 24% 19% 19% 27% 22% 15% 10% 8% 9% 5% 0% Want to open / register for an account Have trouble logging into an account Have a question Have trouble about a specific making a purchase product or service you are interested in purchasing Have trouble Want help on an making a transaction existing purchase or account Want to check the status of an order Want to manage your account or pay a bill Have a problem with the product or purchase after purchasing it Want to make a complaint Want to cancel or terminate an account LivePerson,
7 Consumers recognize the effectiveness of real-time digital engagement tools such as live chat and they appreciate the one-to-one experience that this channel offers (see Figure 6). These tools can help consumers throughout their digital journey, and can ensure that at key moments of confusion, helplessness and potential abandonment, someone is there to engage them and help them reach their goal, all within a single interaction, from the channel they are in. While consumers currently default to the more traditional communication methods of and telephone, they indicate a strong preference for speedy and efficient resolution, something that these options fail to deliver. Real-time, digital engagement tools such as live chat have the potential to revolutionize how consumers connect with brands online, providing them with a fast, comprehensive and human solution sought by today s savvy consumers. Figure 6: Usefulness of online engagement tools 87% 87% 81% 79% 78% 78% 76% 57% Having the ability to re-connect to the same agent that helped you on a previous occasion Having a live chat session with an agent Having the option during a live chat to transition into a phone conversation with the same agent you were chatting with Having the agent display a "how to" or instructional video regarding your question within a chat window Sharing your screen with the agent Sharing documents, pictures or files instantly as you are chatting with an agent online Engaging with the agent in a one or two-way video chat conversation Seeing a picture of the actual agent you are talking to LivePerson,
8 Speed and efficiency Brand loyalty can be won or lost in 76 seconds The digital world offers information to be found and purchases to be made with the touch of a button, and consumers expect this same speed of communication from the brands they connect with online. When it comes to the internet, speed and efficiency reign supreme as the key drivers of an outstanding experience. In fact, the average amount of time a consumer is willing to wait for help online is 76 seconds. What this means for online brands is that consumers have high expectations throughout their online experience when it comes to speed and efficiency. Figure 7: Factors for a great online shopping experience 73% 53% 44% 38% 33% 30% 25% 25% 22% 21% 14% 13% 6% Getting my issue resolved quickly Getting my issue resolved in a single interaction Dealing with a friendly customer service representative Being able to follow up with the same person if necessary Providing me with customized offers / discounts Being able to record, print or save a copy of any interaction with the company / brand Having some follow-up after my enquiry to ensure I am satisfied Being able to multi-task while my issue is being solved Having a personalized experience Not having to speak to someone Being able to access help via a mobile device Being provided media tools such as how-to videos, product demos etc. for purchases Being able to access help via social media sites A great digital experience is made up of a combination of factors (see Figure 7). Live digital engagement tools present an opportunity for brands trying to meet and exceed the expectations of online shoppers by offering real-time help, in the channel they re in. There is no need to pick up a phone and make a call or to send an , which often tends to be less cost effective for brands and slower in resolution time for the consumer. If shoppers do not receive help from a real-time tool within the average desired 76 second timeframe, most would turn to slower, less convenient means, often leading to greater frustration, while others would simply abandon the purchase or site altogether (see Figure 8). Simplicity and efficiency not only lead to an optimal online experience, but they can also translate into brand loyalty and lifetime value. Figure 8: Consequences of not getting real-time response online the company 54% 41% 28% 27% 13% 5% 4% 5% 4% Phone the company Go to an alternative website Feel frustrated Feel unvalued by the company Contact the company on social media Make negative comments about the company on social media Don't know None of these LivePerson,
9 Room for improvement 58% of consumers are frustrated by poor quality service online Despite the significant investment and effort companies put into improving the digital experience for their customers, this research is quick to show us that much room for improvement remains. Consumers are abandoning online purchases and transactions due to frustrations that could easily be remedied, as shown in Figure 9. Furthermore, when contacting a company for help or with an enquiry online, the research shows that today s consumers are disappointed by the levels of service they are receiving (see Figure 10). Figure 9: Reason for abandoning an online purchase 65% 57% 53% 53% 45% 43% 41% 41% 37% 35% Unexpected delivery costs Lack of information about product / service / delivery Website difficult to navigate / can't find what I'm looking for Do not trust the website / security concerns Checkout problems Complicated registration / login process Want to ask a question - can't find the answer Technical issues, such as slow website or unavailable pages Disruptive experience Difficulty in getting any help / customer service on the website While brands strive to make their online experience even more convenient than the traditional customer experience, it is apparent that consumer expectations are not being met by online brands. Support is sought at key stages throughout the customer journey; purchases are abandoned because consumers are not being consistently offered an efficient or high quality experience. Figure 10: Rating of website experience by industry (Base: Those who have had visited each type of website) Excellent Very good Fair Poor Don t know Banks and financial institutions 22% 48% 24% 2%4% Consumer goods and clothing 17% 53% 26% 2%2% Consumer electronics Travel 16% 47% 28% 2%7% 16% 45% 29% 3%7% Gaming and trading 14% 37% 30% 3% 14% Telecommunications and mobile phone services 11% 39% 38% 7% 6% Insurance 9% 31% 40% 8% 12% Government (central or local) or public sector services 9% 28% 40% 14% 10% Educational services and schools 9% 31% 37% 9% 14% LivePerson,
10 Conclusion Companies today have to go beyond getting the basics right when it comes to the digital experience, and for those that exceed consumer expectations, the opportunity for a strong and long-lasting relationship between the brand and customer is clear. What is evident is that when a consumer is engaged online in a meaningful way, their trust and perception of the brand increases, and often they are able to complete a purchase or reach a goal that would have otherwise been lost. By building this sense of trust and engagement, brands build lasting relationships with their customers, leading to a stronger brand reputation and greater business success. While brands strive to create an engaging digital experience, there is still significant room for improvement. As consumers become increasingly accustomed to engaging with brands online, their service expectations continue to grow. Indeed, online consumers want their queries and issues resolved simply, quickly, within one transaction and with a human touch. One size fits all websites and FAQ pages are no longer enough. Failure to deliver these fundamental pillars of the online journey is likely to have a negative impact on the customer experience. Real-time digital engagement solutions such as live chat are emerging as a tool that clearly resonates with online consumers. From sharing screens (co-browsing), re-connecting with an agent and transitioning seamlessly between communication channels, real-time digital engagement shows promise with consumers who have high expectations, are time-strapped and crave an efficient and simple resolution to their questions and problems online. For brands that get it right and meet customer expectations in innovative and meaningful ways, opportunities abound. LivePerson,
11 Recommendation The battle for the consumer is no longer about features or functionalities, it s about delivering a rich, personalized, experience from the moment consumers engage with a brand online. Today s consumers need to feel connected to the brands they engage with, and the companies that understand and commit to this will be the ones that succeed. Brands invest significant budget and resource into building strong digital assets websites, mobile sites, social presence and a stellar self-service platform all to ensure consumers have a seamless experience across all channels. However there will always be a number of visitors who don t complete their journey for some reason or another. Either they can t or won t find what they need on their own, they need personal advice or encouragement, or perhaps they encounter an error. If brands fail to engage them at that critical point, it can be too late. Once they abandon the site, they can t be helped and the brand loses another customer. Many companies can provide online engagement, but there are three principles that are absolutely essential to win the hearts of today s connected consumers: 1) Brands must get smart, and understand who to engage and how to do it. So many companies spend precious time engaging visitors who have no intention of making a purchase, and miss the opportunity to serve a potential high spender or loyal customer. Intelligence is critical. Once you identify the behavior of a high-impact consumer, it is essential to leverage data to connect with them in a personalized way. 2) Consumer engagement must be real-time. Today s consumers won t wait a day or even an hour for service, so brands have to respond in an instant, before their customers abandon them for a competing site. Speed and efficiency are key to successful customer engagement. 3) Businesses must meet the consumer where they are, in their channel of choice, whether it s mobile, social, online, and even offline. Today s consumers are on the go 24/7, and for brands to deliver a powerful consumer experience, they must be able to connect with consumers anywhere and everywhere. Digital engagement tools such as live chat help provide assistance during the moments that matter most in the customer journey. When it comes to that split second decision of making a purchase online, customers need all the information available to them. These tools reduce the interaction time between a brand and their customer, and help that customer achieve their goal quickly and efficiently, while keeping them on site. Yet real-time interaction goes beyond the solitary moments when a customer feels lost. It is about reminding consumers that brands are there for them throughout the entire customer journey, no matter how big or small their problem or need for engagement may be. LivePerson,
12 Notices All information provided in this white paper, including all content, diagrams, data, graphs, lists and other materials, is provided AS-IS. LIVEPERSON, INC. MAKES NO REPRESENTATION OR WARRANTY, WHETHER EXPRESS, IMPLIED, STATUTORY OR OTHERWISE, OR INDEMNITY WITH RESPECT TO ANY INFORMATION, AND LIVEPERSON, INC. EXPRESSLY DISCLAIMS ALL IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NON-INFRINGEMENT. Information furnished is believed to be accurate and reliable. LivePerson, Inc. assumes no responsibility or liability for use of such information of for any infringement of patents, trademarks, copyrights or other rights of any third parties that may result from such use. No license is granted by implication or otherwise under any patent or under any other intellectual property right. Information included in this document is subject to change without notice. Trademarks LIVEPERSON and LP MARKETER are trademarks or registered trademarks of LivePerson, Inc. Copyrights 2013 LivePerson, Inc. All rights reserved.
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