Chatbot Or Live Chat: Which Helps You Retain & Convert More Customers?
Askly CEO & Founder
If customer service had a menu, all your clients would order the "fast and effective" meal.
And what's the preferred customer support method by most online shoppers?
The current preferred method is quick conversation at the product page or checkout, in the form of a chat.
But here's the problem:
It's hard to pick between chatbot or live chat.
Both seem intriguing, yet you might not know which is better for your business.
So, in this article, we will dive deep into the differences between chatbots and live chats to help you make an appropriate choice that helps your business.
What Is a Live Chat?
A live chat is an instant messaging tool that allows your customers to have conversations with real humans from your support or sales team.
Why is that crucial?
Live chat is not as quick as chatbots in terms of initial reply speed.
But, most customers prefer waiting 2-10 minutes for a "human" response rather than interacting with a soulless bot.
They want the "human touch" when it comes to customer support.
On top of that, live chats are more customizable, build a stronger relationship with your customers, and convert more.
What Is a Chatbot?
Chatbots are messaging tools that use artificial intelligence to analyze and instantly reply to your customers with pre-built or auto-generated replies.
Chatbots have one big benefit when compared to live chats:
They cost less than hiring people.
The biggest con?
Chatbots can only solve surface-level issues and will frustrate your customers with its generic responses.
Plus, you risk losing a potential client, who will leave your website the second they feel they're dealing with a chatbot.
Chatbot or Live Chat: Which One Is Better for Your Business?
Choosing between live chat or a chatbot can be a hassle.
Both have pros and cons, and deciding which would be ideal for your business is difficult.
So, in the following paragraphs, we will go over the good and the bad of both live chats or chatbots to make your choice as easy as possible.
Good customer experience fuels your business growth.
For that reason, it should be at the top of your list regarding the key points to focus your company on.
But which one provides a better customer experience:
Live chat or chatbots?
Well-trained chatbots can provide a good CX only for 25-50% of customers.
On the other hand, live chat's human touch, empathy, and accuracy are hard to beat.
50-75% of your customers' inquiries are hard to solve for even a well-trained chatbot due to personal recommendations, language barriers, and specific requests.
Imagine you're looking to buy an expensive smartwatch.
But when you ask the chatbot specific questions, you get generic pre-canned replies.
Would you still buy the smartwatch?
Winner: Live Chat
99% of businesses care about one thing mainly: Profits.
On average, live chat customers typically have 60% higher value carts than clients who prefer calling or sending emails.
Which is a big opportunity besides being the most time-cost effective customer service channel.
You can offer the best product or service, but your business won't last long if you're not converting enough customers.
And one of the best ways to improve conversion rates is by having fast, knowledgeable, and empathetic customer support.
Chatbots are lightning-fast but lack live chat's accuracy and personal touch.
Which is a big deal breaker for many customers.
On the other hand, live chat possesses all three and can be an amazing source of lead generation and boost your conversions.
Winner: Live Chat
Tailoring your customer support replies to the client's issues makes your customers feel valued and understood.
Which, in turn, makes them want to buy more from you.
And when it comes to personalized support, live chats are almost always the better option.
Because a human agent can answer a broader range of questions and understand the customer's needs in detail.
Plus, they can improvise or find different solutions to unique problems your clients might have.
For example, if your client has specific issues with payment errors, your agent can easily help them by looking at your client's technical issues in the database.
Chatbots, on the other hand, have a limited amount of data they can learn from.
Even new-generation advanced AI solutions don't have access to all your databases.
In fact, you can train chatbots on your website or documents, not back-end data sources that your team has access to.
And guess what happens when a chatbot faces a specific request, such as a payment error?
It provides your client with a generic and unrelated response that frustrates them.
Who will most likely leave the cart abandoned and never return to your store again.
Winner: Live Chat
Accuracy and personalization are different sides of the same coin.
And they're both necessary for your customer support efficiency.
For example, if you were to buy a laptop and ask the chat how much RAM it has, wouldn't you get frustrated if it gave you the wrong answer?
When it comes to accuracy, live chat wins by a long margin because human agents can provide your clients with as much detail as needed.
And those details will almost always be correct.
Advanced AI technologies used behind chatbots can help solve between 20-40% of customer questions.
But the problem is that most customers will likely feel frustrated by AI support.
Because chatbots still have noticeable limits regarding accuracy, as they are not trained on real-time data across all internal communication channels.
Winner: Live Chat
As a business, you sometimes need to look for the most cost-efficient solution.
And when it comes to cost-effectiveness, chatbots cut costs by saving your team more time.
Now, the costs here depend on multiple variables such as:
- The cost of your support agents
- Your customer base
- How many customers can each of your support agents handle
Having said that, chatbots can be cheaper if they are properly trained.
Usually, it takes 6-12 months to make a chatbot save 20-40% of your customer support team's time.
And you need to allocate, on average, €10,000 to train a chatbot properly.
After that, there's also the cost of the chatbot's subscription.
Plus, chatbots also need validation and further training, which have additional long-term costs.
But as chatbot technologies evolve and the number of experienced specialists increases, cost efficiency will improve even more in the future.
Different chats have different levels of scalability.
Most chats, for example, don't have localization by default.
So, they need a decent amount of development hours to localize them for every country, language, and customer segment.
This is important because as you scale, you get more international customers.
Most of whom want multilingual support before they purchase.
You could scale live chat and chatbots as much as you like, but it quickly becomes expensive.
Especially if your software has limitations.
Regarding live chat, as you get more customers, you also need more support agents to keep up with the increased customer pool.
On the other hand, you can adapt chatbots for rapid scalability much easier than live chat.
But, if high-quality customer support is vital to your business, you should invest in scaling your live chat service.
Acknowledging a potential customer is crucial.
And the faster you do that, the better.
Because when potential customers come to your website, they want to ask you questions or solve problems.
And the faster you get back to them, the more likely you are to get the sale or positive customer experience.
Having said that, chatbots are much better for customer acknowledgment because they're available 24/7 on your website and can respond instantly.
Conversely, live chat takes between 1 and 15 minutes to get a support agent to answer.
No matter how trained your support agents are, every single person on earth has limited patience.
Some customers can be a pain to deal with because they might ask the same questions repeatedly, not understand replies, or be disrespectful.
On the other hand, chatbots are machines, so they have unlimited patience and endurance.
One of the major concerns online in the past years has been data security.
More and more businesses put increasing efforts into protecting their customers' data.
Something that your clients greatly value.
While chatbots have many pros, one of its biggest cons is that they're machines with access to significant amounts of data and personal information.
Why is that an issue?
Because they're machines, malicious hackers can compromise them, putting your clients' data security at risk.
On the flip side, live chat has human agents who will instantly notify you if suspicious activity happens.
Winner: Live Chat
Being available all the time means helping more potential clients, which in turn improves your conversion rates.
Thanks to the internet, you can have clients from all over the world visit your store and buy from it anytime.
And while you can achieve 24/7 human support with a live chat, it will be quite the investment.
Chatbots, on the other hand, are always available to answer your customers' questions and the total investment will be significantly cheaper.
Integrating all your channels in one place is extremely useful for your customers and your team.
By having all your communication channels integrated, your support team can easily reply to all inquiries from all your different channels in minutes.
Both live chat and chatbots can integrate different channels, like Messenger and Instagram.
Live Chat = Chatbots
Ease of Implementation
While both live chat and chatbots are pretty easy to implement, there is a huge difference to remember:
Live chat is as easy as it gets when it comes to implementation.
In fact, the only challenge with live chat is training new support agents to add to your team.
However, with advanced live chat solutions, onboarding new team members takes just minutes, because all your customers' chat history is available anytime.
They can easily access your customers' chat history anytime and provide accurate replies with one click.
No need to ask colleagues and search from the documentation.
In contrast, chatbots require much more work to implement on your website.
Because you need to create effective flows to ensure they meet your clients' standards.
Which can become expensive and time-consuming depending on how "smart" you want your chatbot to be.
Most chatbots cause negative experiences because teams underestimate the resources and difficulty of implementation needed.
Winner: Live Chat
Handling Repetitive Inquiries
Before choosing between the two chats, you should ask yourself this question:
"How technical or varied my clients' inquiries can be?"
If the answer is "not much", then a chatbot might be the best solution.
However, more and more live chat solutions have suggested and saved replies, that help your team provide excellent customer experience without any typing.
So, by having a great live chat, you're getting the best of both worlds.
Having said that, chatbots are still the faster option for handling repetitive and easy questions.
While live chat can handle repetitive and easy questions, you'll pay much more for similar results.
Customer Satisfaction and Loyalty
Companies that value and understand their customers earn their love and loyalty much faster.
And one of the things that don't make your clients feel satisfied and valued is dealing with unhelpful AI support.
Most of your customers can spot chatbots immediately, which might instantly turn most of them off.
Because chatbots provide generic responses and have no empathy towards your clients.
Conversely, human support agents make customers feel appreciated, increasing customer satisfaction and loyalty.
Whether customers give you 5-star reviews and suggest your store to their friends or not greatly depends on your customer service quality.
In fact, great customer support can solve your customers' problems, leave them happy, and make them love your business even more.
Winner: Live Chat
The faster you reply to customers, the higher the chance of converting them.
And what better way to guarantee higher conversions than an instant support chat?
In fact, chatbots have an average reply speed of 1 second.
On the other hand, live chat takes between 1 and 15 minutes on average to get back to your customers.
In today's globalized e-commerce world, people speak a wide variety of languages and products can be easily shipped worldwide.
What an incredible opportunity for your business, right?
And while most people understand English to a degree, they generally prefer to speak to customer support in their main language.
Now, both chatbots and live chat can have multilingual support in the form of instant translation.
But because live chat has human agents replying with customized responses, the replies will be more accurate.
With chatbots, translations can get wonky and mess up the whole conversation, especially if it gets too technical or lengthy.
Winner: Live Chat
Who Is Live Chat For?
If you have a small to medium-sized business and fewer than 1,000 customers per month, live chat is the best choice.
Because the costs for the customer agents won't be too high.
One agent can efficiently handle up to 1,000 customer inquiries if they are in the same channel.
Plus, having many different channels makes daily work more inefficient.
And with comparable costs, live chat wins out on every front. Especially when compared to phone calls, emails, social media, and chatbots.
Also, if for example, most of your customer inquiries are technical and specific, a live chat with a competent support agent will provide a much better customer experience.
Who Is a Chatbot For?
A chatbot might be ideal if you have a business handling over 1,000 new monthly customer inquiries.
Especially if most of your clients' inquiries are easy and repetitive issues you can train an AI on.
For example, if 60% of your customers' questions are about product information or order status, you can train a chatbot to handle all that.
At a fraction of the live chat's cost.
However, if your customers tend to ask more technical and unique questions, not even the most well-trained chatbot in the world will help you.
Also, chatbots are more suitable in industries with low churn rates/higher customer retention.
If you're worried that your customers might easily switch to the competing product, we recommend keeping the customer service standard high with live chat.
Chatbot or Live Chat: The Verdict
Is live chat the best solution for your business?
Or is it a chatbot?
As you can probably guess, the answer is: It depends.
More specifically, it depends on your business.
But, if you value your customer loyalty, satisfaction, and higher conversions above anything else, live chat is likely the best solution.
And if you're looking for an easy-to-implement live chat with built-in triggers and localization, Askly has the ideal live chat for your business.
Askly is the only chat solution that guarantees a positive customer experience for every visitor.
But every live chat is different, and to understand whether it will work for your business or not, you must test it with your team first.
That's why we let you try Askly today, for free, for 14 days.
Without any obligations.Try It For 14 Days