Taking your online store to the next level isn’t just about attracting new people.
It’s about making the process of finding, and buying, the perfect product easy. It relies on your ability to get your customers back time and time again.
Your growth comes down to creating a loyal customer base whilst maintaining, and increasing, their lifetime value to your store.
That’s a tall order.
Until recently, scaling required increasing your overhead: more staff, more expensive software, more time on the phone with customers.
But not any more.
Conversational commerce is helping stores reach the next revenue milestone without spending more money or burning out due to a massive increase in workload.
The best part of it? Your customers want to leverage conversational commerce, too.
In fact, 61% of US consumers say they have messaged a business in a 3-month period. Perhaps more importantly, 58% of people feel more confident messaging a business then calling them on the phone, and 53% of people are more likely to shop with businesses they can message.
The phenomenon of preferring text over calls is big enough to have its own memes—dozens of them:
As an ecommerce business, you can’t just pretend this isn’t a thing. You can’t just slap your customer service phone number and email next to your products and call it a day.
Actually, you can—but know that any plateau in your growth is on you.
In this guide, we’ll quickly go over the important role of conversational commerce in today’s ecommerce landscape, and then jump right into how you can take your own store to the next level with it.
What is conversational commerce?
Conversational commerce is a technology that brings automated messaging experience into the purchase journey.
Simply said, it’s ecommerce through conversation. This conversation is powered by pre-defined rules and often artificial intelligence.
As a result, a chatbot automatically reacts to your potential customer’s actions in your store, as well as their questions, to provide the best information and guidance possible.
There are two big-picture areas of your online store where conversational commerce can make a huge impact:
- A hands-on, personalized customer support that is immediate and independent of your team’s office hours and time zones
- A proactive approach to your visitor’s actions on your website, so you can intervene at the right moment (for example, when a visitor is about to abandon their cart or struggles to make a decision between two products)
With these powerful areas of timely action, it’s no surprise that live chat has a 73% customer satisfaction rate—rated higher than email and phone. Neither of the two can compete with the timeliness of messaging!
How conversational commerce works
Conversational commerce is an option on any platform that supports chat, such as Messenger, SMS, WeChat, and LINE, as well as those that support voice bots, including Amazon Alexa and Google Home.
You can even implement conversational commerce solutions on your primary web pages.
To give it the space it deserves, we want to focus on the chat side of conversational commerce in this guide.
That space is well deserved, considering that the combined total of monthly active users in top four messaging apps have surpassed those of the top four social networks—all the way back in 2015:
And that’s not all. The time spent in the messaging apps increases every year: it’s expected to be at 12 minutes per day in 2019, up from 8 minutes in 2016:
At first glance, 12 minutes might not seem much, especially compared to the 2+ hours we spend daily on social media.
But remember: people’s attention on social media is scattered. Their attention in messaging apps, however, is focused on just one thing: conversations.
Conversational commerce can be applied on almost any situation you can think of when interacting with your customers. You can view them through four distinct categories:
- Automated and proactive. For example, a new customer completes their purchase, so you follow up with a few messages over a week delivering best tips for that product.
- Automated and reactive. For example, there is something faulty or unclear with the product, so the customer sends you a message. Your system identifies the main keywords and sends them a troubleshooting guide for that specific issue.
- Manual and directed at multiple people. For example, you are launching a new product line, so you send a custom message to people who have bought similar products before.
- Manual and directed at one person. For example, you send a message with a discount code and a thank you note to a customer who left a positive review.
Even these examples can already spark some ideas for your own store. Let’s look at the key benefits you’ll experience from conversational commerce.
Why conversational commerce is a big opportunity
Selling with conversation sounds like a no-brainer—it exists since the beginning of time.
So why does conversational commerce promise a difference to what we’ve done so far to sell successfully? Here are the two main benefits to keep in mind.
Perpetual line of communication
There was a time when ecommerce itself was challenging because people were used to holding an item in their hands before handing over their money. Having store assistants nearby was another thing that online stores had to compensate for.
And they did. Sizing guides, shipping and return details, detailed product photos and videos all helped make this transition as pain-free as possible. ASOS is always an excellent example of all of these elements on a single product page:
However, people now conduct deep research before making their decision without even making you aware they’re looking. They read reviews, watch unboxing videos, and ask their friends for opinions.
And if they want to ask you for advice or share a concern, they’ll look for the easiest way to do so. If they can’t find one, they’ll move onto another retailer.
Conversational commerce bridges this gap and creates an always-open line of instant communication available at a single click or tap, right there on the product page, without annoying waiting periods.
Simplification of the customer journey
What’s even better is the messaging thread that can always get picked up wherever the customer left off, on another device, in another browser window, and on a different day, thanks to integrations such as Facebook Messenger.
And with the growth of mobile commerce, this makes a crucial difference.
Mobile shopping is a huge part of this: predictions say that by 2021, almost 54% of all retail ecommerce sales are expected to be generated on mobile—up from 34.5% in 2017!
Relatively small smartphone screens make it more difficult to facilitate steps around the purchase itself. Customer service, post-purchase support, questions on returns—they all present an interruption of a mobile shopping session.
Conversational commerce reduces the jumps between channels. It hosts all sales and customer service in a single place, and it personalizes the information given to the customer in an instant.
Finally, simplifying the customer journey also means you can offer customer service at scale.
Automated chatbot is available 24/7 to answer simple questions, while your support team can focus on more demanding issues, which creates a better customer experience and helps build stronger customer loyalty.
Scale your online sales with conversational commerce
With all this in mind, here’s how you can use conversational commerce to take your online store to the next level.
If your ecommerce business is doing well, the following two statements are probably true:
- You are successfully attracting a large number of people to your online store every month
- You have a solid idea of how much your customers spend, how frequently they buy, and their lifetime value
In other words, you know your numbers inside out. You also know that, in order to convert more of your online store visitors and/or to get them to spend more on average, you need to hire more people and invest more time.
And if you do that, your profit margins might remain the same or even decrease. That’s not what you’re looking for.
From this point, there are two main ways you can drive more sales and revenue without increasing your expenses and lowering your profit margins:
- Get those who aren’t buying to buy (in other words, convert more visitors to your online store)
- Get those who are already buying to spend more and/or to buy more often
As you may have noticed, the first point focuses on acquiring new customers, and the second one on retaining them and driving recurring purchases.
Let’s dive into four ways you can make this happen with conversational commerce:
- Upselling and cross-selling
- Cart abandonment
- Predictive replenishment
Smart upselling and cross-selling
Personalizing your shopping recommendations is a powerful scaling method. 59% of shoppers who have experienced personalization believe that it has a noticeable influence on their purchase decisions.
Conversational commerce carries a particular advantage over email and other marketing channels: it’s immediate and highly contextual.
To make the most out of upselling and cross-selling, create a campaign that automatically checks in with your customer a certain period of time after their purchase.
You can ask:
- Initial feedback on the product
- Which product variations (colors, sizes, etc.) they’d like to see
- What made them buy that particular product
Think of ways to kickstart a conversation to nurture your relationship with this customer. Then, over time, you can deliver customized product recommendations based on their answers.
A brilliant example comes from Sephora’s chatbot on Kik:
This approach will give you a double win: you’ll increase the lifetime value and purchase frequency in the short term, and build customer’s brand loyalty in the long run.
Abandoned cart recovery in a single tap
The benefits of recovering abandoned carts are nothing new. Cart abandonment has been a talking point in targeted email marketing for a long time now.
With almost 70% of all carts being abandoned, that’s no surprise. Why would you miss out on the chance to get your customer right where they left off and get them to spend the money they otherwise wouldn’t?
However, with segmented inboxes, email fatigue, filters, and unsubscription services, customers are becoming more difficult to reach through their inboxes.
This is where direct messaging comes in as the perfect replacement for cart recovery emails.
Just like with emails, you can use a channel such as Facebook Messenger to send the customer right back into their cart to complete the purchase.
The obvious benefit is the immediacy of it (most people wouldn’t get a cart abandonment email as a notification on their phone!).
But there’s an even better benefit: if your customer has some unanswered questions, they can simply reply to your cart abandonment message to get the answers they need.
Predictive replenishment and keeping the customer to yourself
What if you could get your customers to buy from you again and again—without overwhelming them with emails and messages that are only about discounts or new product launches?
There’s something magical about retention: repeat purchasers are nine times more likely to convert and spend 500% more than new customers.
It’s nothing revolutionary. Software-as-a-service companies and subscription-style product brands like Birchbox and Dollar Shave Club have been reaping these rewards for a long time.
But as a simple, straight-up online store, how can you drive recurring revenue?
The answer is simple, yet genius: predictive replenishment.
Predictive replenishment is as simple as sending your customers timely reminders about a product they’re likely to run out of soon.
This has two advantages. First, it allows you to provide a personalized experience that makes customers feel special. Second, the reminder helps you prevent them from buying a competitor’s product when they run out of yours.
Of course, you’ll want to keep track of when they bought the product. Based on that, you can simply send a reminder to replenish the product a few days before the product is expected to run out.
You can put this into practice for almost every type of product. Here are two main categories and examples of them:
- Consumable goods: groceries, toiletries, pet food, cleaning products, stationery, and anything else that comes with a certain lifecycle. Order gap analysis is a good way to gauge the average time it takes your customer to reorder so you can plan your replenishment messages around that.
- Non-consumable goods: fashion, home goods, sports equipment, and other long-lasting products. You can spark recurring purchases by relying on seasons of the year and cross-selling maintenance products (that likely have a shorter lifecycle than the main products).
And if you want to earn bonus points, ensure you send your replenishment messages enough days before the end of the purchase cycle to allow time for shipping.
Grow your profit margins with conversational commerce
From an always-open communication line with your (potential) customers through to delivering the best product recommendations at the right time, conversational commerce can take your online store to the next level.
If you’re looking for a social commerce partner that will enable you to do exactly that, make sure to take Jumper for a test drive.
Which one of these methods will you try first? Let us know below.