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Aug 06, 2002
Case Study

Can Adding Instant Messaging Improve Your Site's Profits? One B-to-B Site's Story

SUMMARY: Two weeks ago Forbes reported that an online shopper who uses the "Live Chat" feature on LandsEnd.com is 20% more likely to make a purchase than a customer who does not. We wondered, is this true for other sites, or not?

Our new Case Study features results from two different B2B marketers who have tested adding instant messaging to their sites. It also presents the business case for excellence in customer service. Trying harder equals profits.

Plus, if you have a yen for a David vs. Goliath story, as in Web entrepreneur trounces...
CHALLENGE

When Brett Hayes founded RentQuick.com out of his basement four years ago, he had big competition including several public companies serving the same marketplace: Business executives who spend $200-$10,000 or more per purchase renting notebook computers and other audiovisual equipment.

His competitors had famous names, printed catalogs, and sales partnerships with hotels across America. Hayes had a web site.

Hayes' goal was to be profitable as soon as possible, without accepting any outside investors. Could a homegrown Web-based company compete with established multi-million dollar firms?

CAMPAIGN

Hayes looked for a weak spot in the competition's armor. What do business customers dislike about doing business with most big companies?

First of all, big companies often portray themselves online just that, big companies. Their sites talk about themselves. "We" and "Our" are words you will see everywhere. Hayes imitates a big company site, "We're providing projectors for everybody."

But each visitor is not everybody. Each visitor is an individual.

Instead of talking about "we," the copy on RentQuick.com was written specifically to appeal in a one-to-one sense to the individual. For example, the word "you" appears four times on the clean and simple home page:

1. Notebook and projector rentals shipped nationwide to your destination!

2. How can we help you?

3. Thank you RentQuick! (above a testimonial)

4. Tip: A great way to cut down on costs is to schedule your...(etc.)

To help new visitors feel that RentQuick is a trustworthy company right from the get-go, the home page includes
- a customer testimonial
- a guarantee
- photos of three typical products
- several ways to contact the company for immediate help.

Despite all these elements, the home page (and the rest of the site) is laid out very cleanly and simply. You do not need to scroll down or click around a lot to find what you need. The site design itself becomes part of the Company's overall brand.It spells out both visually and viscerally that you the customer will have an easy, hassle-free, business experience here.

(How often can you say that about most business technology company Web sites?)

Secondly, Hayes believes that big companies have taught business customers to expect it to be hard to communicate with them. For example, you often have to search for contact information on a company site.

As a competitive stance, Hayes placed contact information on every single page of the site. Then he set customer service rules about each method of communication:

Rule #1: Telephones are answered by human beings

If you call RentQuick's phone line, you will not be placed on hold. Hayes says, "There's nice music playing on our hold line, but I don't think anyone's ever heard it."

The phone tree is limited so incoming callers donít have to click through too many menus in a row. If you do reach a voicemail box, someone from the company will call you back within two minutes or less. (Two minutes!)

Hayes says, "We wanted to be the complete opposite of a big company. You can wait on hold for 10-15 minutes just to get a quick question answered, or go to their Web site and not even find a telephone number. Whatever separates customers from us, we want to close that gap."

Rule #2: Email is answered within minutes

Hayes says, "Major companies don't use email effectively. If you email an address on their Web site, you'll get an autoresponse reading 'Thanks for your email, we'll get back to you in 24-48 hours.' People have become accustomed to the fact that email is not an instantaneous conversation. It can be a long-term communication."

Rule #3: Instant messaging is encouraged

Because business people have been trained to not expect fast and easy communication with companies via phone or email, new visitors probably would not expect it from RentQuick. Hayes decided to add instant messaging to the site and refer to it prominently on every single page.

He hoped prospects who might be hesitant to call or email would try the IM instead for a quick answer or reassurance.

Hayes' advice for training sales teams to handle IM:

-> Help staffers who are great verbally on the phone become more fluent in writing. "Some reps have trouble typing quickly, so we suggested a list of specific words to use."

-> Avoid back-and-forth answers. "Customers are going to spend at most a couple of minutes chatting, they are not going to go on for an hour. You have to answer the question in the first response. You ca not hem and haw."

-> Write in brief telegraphic style. "You have to be very specific, and answer in as few words as possible. If you're sitting there typing for five minutes, they're going to bail on you. No essays!"

-> Offer to move the conversation to the phone as soon as a customer's questions are complex, or they need more personal service. "50% of the time it ends up with them calling us. Chat is like triage. The customer gets basic questions answered, maybe a few qualifying questions, before they make the commitment to make a phone call."

-> Use advanced IM features sparingly, if at all. When Hayes tested the "push URL" feature his system offers, which pushes the visitor to another Web page he found that it alarmed people. "It's not increasing their feeling of security. They think, 'Oh my god, this guy just took control of my computer! What else is he doing to it?'"

He had similar results when his team tested popping up a "would you like to chat?" bubble on visitor's screens (versus leaving the option as a static icon on the screen). More than 80% of visitors ignored the bubble, and Hayes suspects many simply abandoned his site because of it, in the same way browsers in brick and mortar stores will back away if a sales rep is too pushy.

-> Give a specific staffer the responsibility of returning IM messages that are left by visitors late at night or on weekends when the system is on "take messages" mode. As you can guess, this staffer whips out responses first thing every morning.

There's one other big difference between RentQuick and its competition's services -- RentQuick is generally much less expensive. However, that's a competitive advantage Hayes doesnít brag about, nor is it immediately apparent from the site itself.

Why? "Our extreme focus is on the customers, not on price. Once you get into branding by price, you're commoditized. Your profit margins drop. Nothing differentiates you."



RESULTS

RentQuick has been profitable since its first month f business, and RentQuick now has thousands of business customers across the US.

Hayes left his basement office behind long ago. Currently he is having an office building built in Virginia for his expanding staff, in order to save money on commercial rent.

More notes:

- About 5% of site visitors click on the Live Chat button to instant message a question to RentQuick's sales reps. Hayes notes this percent will vary for other businesses depending on how complicated their product or service is. If you offer customized goods or services, expect more people to have questions.

- Many of the questions people ask are things they could find out for themselves if they poked around on the site a bit more. Business people are impatient, and appreciate the convenience of just being able to ask.

- Although Hayes does not credit instant messaging with many direct sales (he prefers to consider it a customer service investment), his Web developer Damian Bazadona of Situation Marketing, who also offers Live Chat on his own site, does.

Bazadona says just under 20% of his new client accounts, spending $10k-$20k each, were a direct result of his live chat button. "It's awesome. I'm a big fan of it. I easily made my money back in the first month."

However, you will not find live chat on Bazadona's site right now because he is booked solid this month, and as a one-man shop does not have time to handle it constantly. He feels the "leave a message" version of the button looks pretty lame to visitors if it is on during business hours. (We agree.)

- Hayes has found the number of instant message requests RentQuick's site gets each day is a great rough indicator of how good business is going to be. In fact it may be a better indicator than traffic stats because it weeds out aimless visitors from qualified prospects.

He adds, "The volume drops dramatically during weeks with long holiday weekends, but the following week, it doubles. It's the pulse of what's going on."

- Both Hayes and Bazadona are considering changing the name of their site's live chat buttons to "instant message" instead of "live chat" because chat has gotten a slightly sleazy image, and more and more people use the term "instant messaging" at the office.

Many big companies say they care about customer satisfaction, but when push comes to shove, they often think it is too expensive to really dedicate the necessary resources for the type of instant one-to-one communication RentQuick offers customers.

Is fabulous customer service a smart business investment?

Hayes says, "Our business is not renting a projector or laptop. It's engaging a customer's trust and fulfilling that trust. No matter what they want us to do, we'll deliver it and it will work the way it's supposed to work. The mantra around here is 'Build trust.'"

This mantra has proven to be profitable.

Over the past year several of Hayes' biggest competitors have gone Chapter 11, while RentQuick has continued in the black. In fact, Hayes says the Company exceeds the AV rental industry average of 9% profit "substantially."

LINKS:
http://www.rentquick.com


Bazadona's Web design firm which did the RentQuick site
http://www.situationmarketing.com


Tech that powers RentQuick's instant messaging
http://www.liveperson.com

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