What is live chat? - An Ultimate Guide for 2024

Live chat has emerged as one of the most popular engagement avenues for individuals to receive real-time, personalized responses to their support, sales, or marketing queries. 63% of customers now say that live chat is their preferred method of communication, suggesting that if your organization doesn’t already offer it as an option – it should.

Today, we’ll dive into what live chat is, the benefits that it can provide, and some best practices you can employ to maximize its potential.

What is live chat? 

Live chat is a real-time communication tool that allows businesses to interact with website visitors directly through instant messaging. It typically appears as a chat window, enabling users to ask questions or receive support without having to leave the page or wait for an email response. Live chat is often used for customer service, sales inquiries, and technical support, providing immediate responses to help streamline the customer journey.

How does live chat work?

When a user visits a website with live chat enabled, they can initiate a conversation by clicking on the chat icon, usually located at the bottom corner of the page. This opens a chat window where they can type their message and send it directly to a human representative or chatbot. The live chat system instantly notifies the agent of the incoming message, allowing them to respond promptly.

On the backend, live chat is often connected to a customer relationship management (CRM) system or other support tools, allowing representatives to access relevant customer information, previous interactions, and other data that can help personalize the conversation. This combination of real-time communication and backend integration makes live chat a powerful tool for improving the overall customer experience (CX).

Why is live chat important?

By providing individuals with access to instant support, live chat allows businesses to address inquiries in real-time, which can prevent potential customers from leaving the site due to frustrations. This immediacy not only improves the overall CX, but also builds trust and credibility, which are key factors in fostering long-term relationships. Even more, it provides organizations with valuable insights into customer behavior, empowering them to refine their products, services, and marketing strategies.

For customers, in addition to instantaneous responses to their queries, live chat often allows for multitasking, enabling them to continue browsing while chatting with an agent, which enhances the overall user experience (UX). This eliminates unnecessary friction from the customer journey, thus streamlining the entire process Additionally, 51% of customers prefer to use live chat while multitasking.

Benefits of offering live chat customer support

As customer expectations continue to rise, businesses must adapt by providing efficient and responsive support across all touchpoints. Live chat has proven to be an invaluable asset in meeting these demands, offering a host of benefits that go beyond simple communication.

Let’s dive into some of the key advantages offered by live chat, demonstrating how it has become a cornerstone of modern customer engagement efforts:

Offer omnichannel service

In an omnichannel approach, live chat allows businesses to offer a consistent and unified CX across all platforms, ensuring that interactions remain fluid no matter where the conversation begins or ends. For example, a customer might start a conversation on social media, continue it via live chat on the company’s website, and then receive follow-up information through email. 

By integrating live chat with CRM systems and other business platforms, organizations can maintain a complete history of communication, providing agents with the context they need to deliver personalized and efficient service.

Increased efficiency and productivity

Unlike phone support, where agents are limited to one conversation at a time, live chat allows reps to manage several chats concurrently, increasing the volume of customers they can assist in a given period. This multitasking capability means that companies can serve more individuals with fewer resources, leading to lower operational costs and higher productivity.

Moreover, live chat integrates seamlessly with script-based and AI-powered chatbots, which can handle routine, and sometimes even complex, tasks without the need for human intervention. These bots can manage straightforward customer interactions, provide information, and process transactions, allowing human agents to focus on more critical and complex issues.

Leverages automation

One big live chat feature is the ability that empowers organizations to automate various tasks by integrating with a range of digital tools that help streamline communication. For instance, live chat platforms often include automated triggers, which can initiate a chat session based on specific user actions, such as spending a certain amount of time on a page or attempting to exit the website. These proactive chat invitations ensure that customers receive timely assistance, often before they even realize they require help.

Additionally, live chat systems can automatically route incoming queries to the appropriate department based on predefined criteria, such as the nature of the inquiry or the customer’s location, ensuring that issues are addressed by the most qualified staff member without manual intervention.

Analytics and reporting on customer trends/needs

With live chat, every session generates valuable data that can be analyzed to identify common questions, concerns, and pain points that customers experience. By examining chat transcripts, companies can uncover patterns in customer inquiries, such as frequently asked questions (FAQs), popular products, or recurring issues with certain services.

In addition to qualitative insights, live chat platforms often come equipped with robust reporting features that track key performance indicators (KPIs), such as response times, resolution rates, and customer satisfaction scores (CSATs). These metrics provide a measurable view of customer service effectiveness and can highlight areas where improvements are needed. For example, businesses can identify peak chat times and adjust staffing levels accordingly or discover that certain types of queries take longer to resolve and require additional training for agents.

Increase customer satisfaction

Customers appreciate the ability to get answers to their questions or resolve issues instantly, without the need to wait on hold or for an email response. This immediacy not only reduces frustration, but also enhances the overall CX, as users feel valued and understood when their needs are addressed promptly.

Moreover, live chat often allows for more personalized interactions, where agents can access customer history and preferences, tailoring their responses to each individual’s specific situation. This level of personalized service fosters a stronger connection between the customer and the business, leading to higher satisfaction levels.

Key features in live chat customer support

From real-time communication and automated responses to detailed analytics and integration capabilities, live chat systems provide a comprehensive suite of functionalities that can transform how businesses interact with their customers. 

Some of the most useful features found in competent live chat solutions include: 

Fast “canned responses”

A canned response serves as a pre-written, templated message that agents can quickly insert into a conversation to address common questions or issues. These responses are designed to save time and ensure consistency in communication by providing instant answers to FAQs.

For example, a canned response for a general introductory greeting from a user might look like: "Hello! How can I assist you today? If you have any questions or need help, I'm here to provide support right away."

Live typing

Live typing refers to a feature that allows support representatives to see what an individual is typing before they send their message. This preview empowers agents to anticipate the user’s question and prepare a response more quickly. Live typing can enhance the CX by making interactions feel more immediate, as reps can often address issues even before the customer even finishes typing.

Integration capabilities

Competent live chat solutions are typically highly integrable with a variety of digital channels and platforms, perhaps most notably CRM systems. By connecting live chat to their CRM, companies can automatically sync conversation transcripts, customer details, and interaction histories between the two. This integration provides business reps with a complete view of the customer journey, allowing them to deliver personalized support based on previous interactions and identified preferences. 

Beyond CRM, live chat can also connect with marketing automation tools and e-commerce platforms. For example, integrating live chat with an e-commerce solution enables agents to access real-time inventory data, process orders, and even assist with payments directly through the chat window. Similarly, when integrated with marketing automation tools, live chat can trigger personalized follow-up messages, lead nurturing campaigns, or distribute surveys based on the chat interaction.

Live overview of page visitors

Live chat can provide live insights into page visitors by tracking and displaying real-time information about who is currently browsing a website. This feature allows agents to see details such as the visitor's location, the pages they’re viewing, and how long they’ve been on the site. Armed with this information, representatives can proactively engage individuals, offering assistance or personalized recommendations based on their behavior and interests.

This live overview not only helps in identifying potential leads but also enables businesses to offer timely support, improving the chances of conversion and enhancing the overall UX.

Personalization features

In addition to personalizing conversations through the use of CRMs and other data platforms, live chat can also help tailor interactions by allowing agents to address customers in a more conversational manner, creating a sense of connection and understanding. Through live chat, representatives can use an individual’s name, acknowledge previous interactions within the same chat session, and adapt their tone to match the customer's communication style. 

This personalized approach makes the interaction feel more like a natural conversation rather than a scripted exchange, facilitating a more engaging experience.

Provide transcripts of interactions

Live chat transcripts serve to capture the entire dialogue, including all messages exchanged during the chat session, and can be accessed or emailed to both the customer and the business for future reference. Transcripts are valuable for several reasons: they provide a record of what was discussed, help ensure continuity in case further follow-up is required, and can be used for training purposes or quality assurance (QA). 

By maintaining a detailed record of interactions, organizations can ensure that customer issues are accurately tracked and resolved, enhancing overall service quality and customer satisfaction.

Collect surveys and insights

After a chat session concludes, most live chat solutions offer the option to automatically present customers with a short survey or feedback form, asking about their experience and the support they received. This approach encourages individuals to provide their opinions immediately while the experience is still fresh, leading to more accurate and actionable feedback.

Furthermore, live chat can capture valuable insights through the dialogue itself. Agents can use the chat to ask targeted questions and probe deeper into customer needs and preferences. The conversational nature of live chat allows for a more nuanced understanding of CXs compared to traditional survey methods, as reps can engage in real-time discussions and follow up on specific concerns.

Live chat vs chatbots

Live chat and chatbots are both essential tools for customer service, but they serve different purposes and function in distinct ways. 

Chatbots serve as automated programs designed to simulate human conversation. They’re typically either rule-based or powered by artificial intelligence (AI), and are often used to handle routine tasks. These bots are available 24/7, making them ideal for offering immediate responses during off-hours or when human agents are unavailable. While chatbots are efficient at managing straightforward inquiries, their ability to handle complex situations is limited compared to live chat.

On the other hand, live chat involves real-time communication between either a chatbot or human agent and a customer, allowing for personalized and flexible interactions. Even if a chatbot is tasked with initially handling a conversation, live representatives are typically on standby if escalation is required. This human element makes live chat particularly valuable for handling complex issues and providing a level of empathy that automated systems may lack.

Live chat best practices

Simply offering live chat isn’t enough to guarantee success; businesses must implement best practices to fully realize its potential. From ensuring quick response times to following up with customers after a chat, the following practices are essential for creating a positive customer experience:

Take a proactive approach

Employing a proactive approach with live chat involves anticipating customer needs and engaging them before they even request assistance. 

One effective strategy is to use automated triggers that initiate chat sessions based on specific user behaviors, such as spending a certain amount of time on a page, viewing a particular product multiple times, or attempting to leave the site without making a purchase. By setting these triggers, you can proactively offer help, answer questions, or provide recommendations at critical moments in the customer’s journey.

Offer fast service

To offer quicker service through live chat, start by implementing canned responses for FAQs, which allow agents to promptly provide consistent answers without having to type out each response manually. You’ll also want to verify that your live chat system is integrated with other key business tools, such as knowledge bases or internal databases, so that representatives can easily access relevant information during the chat. 

By streamlining the process of retrieving and delivering information, you can significantly reduce response times and improve the overall efficiency of your live chat support.

Gather feedback and act accordingly

Including surveys at the end of live chat sessions can help to gather an understanding of the customer’s satisfaction with the service, the agent’s helpfulness, and whether their issue was effectively resolved. Reviewing chat transcripts can provide further qualitative feedback, revealing recurring themes that may not be captured through structured surveys.

In order to act effectively on this feedback, it’s vital to regularly review it to identify common areas where customer expectations aren’t being met. For instance, if feedback frequently highlights slow response times or inadequate solutions, it may indicate a need for additional agent training or process adjustments. Be sure to share these insights with your team to promote a culture of continuous improvement, where feedback is actively used to enhance the CX.

Have contingency plans for when live chat is offline

Occasionally, your live chat system may experience either anticipated or unanticipated downtime, which will require you to have a contingency plan in place in order to continue engaging with customers. During these offline periods, provide alternative contact options, such as email or phone support, so individuals can still reach out for assistance. Setting up automated responses that inform customers when the service will be back online also ensures that customers aren’t left in the dark.

A robust self-service system can also be helpful in these situations. For instance, a FAQ section, knowledge base, or AI-powered help center all serve as valuable self-help resources that customers can access when live chat is offline. These tools should be easily navigable and cover commonly experienced issues, allowing individuals to find the answers they need independently. 

Offer followups

It’s best practice to deliver a follow-up message shortly after a live chat has ended, thanking the customer for their time and confirming the resolution of their issue. This message can also include a summary of the conversation, any actions taken, and additional resources that might be helpful. By following up, organizations can ensure that individuals feel valued and supported even after the initial interaction has concluded.

Additionally, including a brief survey in the follow-up message allows individuals to share their thoughts on the support they received. If a customer expressed dissatisfaction during the live chat or indicated that their issue was not fully resolved, the follow-up communication should prioritize addressing these concerns, either by escalating the matter to a more experienced agent or offering additional assistance.

Live chat use case examples in 2024

When implementing your own live chat solution, it can sometimes be helpful to look toward real-world examples of other companies who have already found success with their own blueprint. Let’s take a look at some well-established brands who have identified a live chat approach that best serves their customer base:

Discount Mugs

Discount Mugs is a company that specializes in customizing promotional products and event favors. Its live chat tool is displayed as a circular icon in the bottom right-hand corner of its homepage, presenting users with three options when clicked: Sales, Customer Service, and Privacy Policy. 

When a user clicks ‘Sales’ or ‘Customer Service’ they’re immediately directed to a chat interface that prompts them for their email address in the case that they’re disconnected. Meanwhile, ‘Privacy Policy’ unambiguously lays out how customer data is used, helping promote transparency while putting customers at ease about any security concerns.

Once a visitor enters the chat interface, they’ll first notice the text toward the top that reads “Typically responds in under 3 mins.” This serves to set expectations from the onset and avoid the potential frustration of not knowing when an agent will be available. Discount Mugs has also savvily employed the use of triggered campaigns, where the chat can proactively engage with individuals based on where they are in their unique journey.

HubSpot

As HubSpot itself offers live chat as one of the softwares it provides to clients, it’s only right that it expertly utilizes it for its own purposes as well. The company’s live chat can be used to connect with sales, marketing, or customer support, allowing it to be used as a utility knife to get individuals to where they want to be.

HubSpot’s live chat experience begins at a simple ‘chat bubble’ icon in the bottom right-hand corner of its website. It’s big enough for users to notice, but not so large as to disrupt the natural user experience. They’re first presented with a chatbot that’s available to resolve routine queries immediately, with the option to request an escalation to a live agent for more complex issues. Even more, it provides users with the ability to attach files up to to 10mb to help better describe their questions or issues when interacting with human representatives.

Bank of America

In the finance and banking sector, establishments are routinely inundated with a high volume of customer support requests, making a robust live chat system a must. Bank of America’s live chat option is not quite as intuitive as the first two use cases we’ve examined; the chat icon isn’t presented on its homepage, as users instead need to navigate to a specific tab for it to pop up in the corner.

Once it is available though, BofA’s live chat system serves as a proactive and easily navigable resource for individuals to use. After approximately one minute of lingering on any page, it alerts users with an automated message letting them know that assistance is available for whatever specific content they’re browsing at that moment. When they click on the chat bubble, they’re prompted with some multiple choice selections to better narrow down what type of guidance is required before directing them to an appropriate live agent.

Live chat tools and features

A competent live chat solution should offer an array of tools that serve to enhance both the employee and customer experience by making it more intuitive and informative. When determining which software to employ for your organizational needs, it’s vital to ensure potential providers offer functionalities that align with your identified business pain points and objectives.

Key features to look for include:

• File sharing: The ability to send and receive files, such as documents, images, or screenshots, directly through the chat window.

• Chat routing: Automatically directs chats to the most appropriate agent or department based on the customer's inquiry.

• Visitor monitoring: Tracks and displays real-time data about site visitors, including location, pages viewed, and time spent on the site.

• Chat transcripts: Saves a record of the chat conversation, which can then be emailed to the customer or stored for future reference.

• Proactive chat triggers: Automatically starts a chat session based on customer behavior, such as visiting a particular page or spending a certain amount of time on the site.

• Offline messaging: Allows customers to leave messages when agents are unavailable, ensuring that their inquiries are addressed later.

Leverage live chat and enhance your customer experience with Freshchat!

Freshchat serves as the perfect solution for companies seeking a comprehensive engagement platform that offers robust live chat capacity, powerful chatbots, and extensive omnichannel potential. It excels in offering a plethora of personalization options, while being easily navigable for both internal agents and end-users, enhancing the overall experience for all parties.

Some of Freshchat’s standout features include:

• Chatbots: Powered by Freddy AI, Freshchat’s bots are context-driven and can provide instant and precise answers around the clock.

• Journeys: Allow users to send targeted messages and proactively reach out to customers.

• Canned responses: Empower support teams to respond faster with predefined replies for common questions.

• Live translate: Enables representatives to reply to customers in their language, in real-time using live translation. 

• Visitor intel: Provides information on who visitors are, their navigation path, and more to ensure that each conversation resonates with that unique individual.

If there are any features your company requires that Freshchat doesn’t offer, simply browse our robust Marketplace for access to hundreds of third-party applications that can be seamlessly connected to the platform.