From the November 1999 issue of Entrepreneur

A customer orders several items from your Web site, but never receives them. After several failed attempts to contact your company, he finally gets through to you, but you have to tell him his products were never shipped, and, in fact, five of his six orders were lost completely when your online transaction system crashed during the pre-holiday rush. To top it off, no one in your customer service department even notified the customer that there was a problem with his order.

This "nightmare before Christmas" became a reality last year for many e-tailers who didn't implement the proper customer service techniques on their Web sites. In fact, 46 percent of Web consumers left a preferred site due to technical problems and delayed service last holiday season, according to a post-holiday survey conducted by Jupiter Communications Inc., a New York City e-commerce research firm. The study found many of these consumers subsequently picked alternative sites on which to shop.

Smart companies are heeding their customers' concerns and taking action. They're redesigning their Web sites to offer such features as online chats with customer service reps, and Internet telephony technology to answer customer questions, solve problems and, ideally, sell customers on additional products.


Melissa Campanelli is a technology writer in Brooklyn, New York, who has covered technology for Mobile Computing & Communications and Sales & Marketing Management magazine. You can reach her at mcampanelli@earthlink.net

Online Service

Online chats, Internet telephony and Frequently Asked Questions (FAQ) pages are important customer service tools, says Jordan Fladell, founder and COO of Definition 6, an Atlanta consulting company that provides e-commerce solutions to small and midsized companies. Online chats allow customers to click a button on a Web site and communicate with a customer service representative in a one-on-one, text-based chat room. When the chat service is connected to a company's back-end system, customer service reps can browse Web pages simultaneously with the customer.

Some companies also allow customers to talk to service reps through their computers using Internet telephony, assuming the customer has the proper equipment. When customers click an icon on the company's Web page, the call is launched, and a mini Web phone is installed on customers' computers so they can talk to agents on their computers through speakers as if they were on a telephone.

FAQ lists are questions and answers you place on your Web site to address common concerns from site visitors. These simple lists help smaller companies without 24-hour customer support take care of customers without having to answer them live. FAQs can provide a wide range of information, including delivery schedules, how-to information about the site and instructions on making a purchase.

E-mail is another great customer service tool. Fladell says that after an order is placed, you should send an e-mail to the customer to confirm receipt of the order and let that person know when to expect delivery. This simple gesture instills confidence in Web-wary shoppers that their orders haven't been lost in the abyss of the Net. If there's a delay in processing a customer's order, e-mail him or her immediately to head off any frustration. Finally, Fladell suggests sending a follow-up e-mail after a customer has received a shipment to say "thank you" and offer tips on maximizing the value of a purchase. You can even use the e-mail as an up-sell opportunity for additional products, as long as the rest of your message doesn't come off as a superficial attempt to increase the sale.

Good customer service-oriented Web sites also allow customers to track their purchase histories, the status of their deliveries and the last few orders they placed on the site. Offering customers the ability to check orders or find answers themselves is important because, says Fladell, "it frees up your time to do things that help you make money."

Tools You Can Use

There's a wide selection of software, hardware and services to help improve your online customer relations. You can opt for relatively simple real-time, text-based chat applications, including ichat (http://www.ichat.com) from Koz.com, which costs $594 for 50 users and one year of support. ChatSpace (http://www.chatspace.com) offers an innovative chat software program called iInteract, which allows customers to ask questions in a chat room; it also contains features to easily develop FAQs based on those questions. ChatSpace can be purchased as a software package for $995 (street) for a five-user license or hosted for you for $99.95 per month. It's also available through several ISPs.

You may want to move from a simple chat software application to a full-service customer service solution, and a good one is LivePerson (http://www.liveperson.com). This service, which costs approximately $250 per operator per month, allows your representatives to use chat-based customer service which is launched from your Web site. You may prefer a service such as this if you don't want to handle implementation and maintenance yourself.

Then there are more expensive solutions, which can cost a company anywhere from $150,000 per user to $1 million for an entire system. These can include features such as 24-hour live customer support combined with an Internet telephony application, and the ability to manage e-mail and chat sessions in real time. Companies offering these services include eShare Technologies (http://www.eshare.com), Silknet Software (http://www.silknet.com) and WebLine Communications (http://www.webline.com).

Don't give up on the thought of a full-service solution yet: Many of these companies have formed arrangements with ISPs or systems integrators that allow smaller companies to purchase these services on a monthly basis--prices vary greatly among providers. In addition, MCI WorldCom recently incorporated WebLine's Collaboration Server software into the latest version of Click'N Connect, its click-to-talk service. This service allows your site's visitors to establish instant voice connections with your company representatives and simultaneously co-browse the Web. This service costs about $300 for initial setup with a monthly service fee of $150, plus an average fee of $1.80 for each PC-to-phone transaction.

Of course, most of these customer service applications can be added to your site by Web consultants or your ISP. Some applications can be connected to back-end systems and databases to let customers track their orders. Prices vary for these services.

People Skills

Although e-mail, chats and FAQs are important parts of your customer service survival plan, they won't mean much if the people manning the phones or conducting the chat sessions aren't trained properly. One company that understands the importance of combining technology and the human touch is toysmart.com, owned by Netpreneur David Lord. This Waltham, Massachusetts, online toy-seller offers phone support and live text-based chat through Silknet Software's Silknet eService. The "customer care" team consists of 30 to 50 representatives trained to take suggestions from consumers, answer questions about missing orders and the company's product lines, and even field hard-to-answer questions such as "What kind of toy should I buy for a child with a certain type of learning disability?"

Toysmart.com has the right idea. No matter how big your technology investment is, it's the people behind the technology who can make or break your customer service reputation. According to Mark Reese, chief e-commerce officer at toysmart.com, "We want to provide customers with the tools that let them receive as much information as they can, such as shipping information and the ability for customers to inquire about their purchases."

Are You Losing E-Customers?

You could be if your site is frustrating potential buyers. Following are the top reasons consumers don't complete online transactions:

41% - The site was too slow.

20% - The site looked unprofessional.

16% - The site didn't take credit cards.

14% - I couldn't find the checkout areas.

12% - I couldn't find a return policy.

Source: Esearch.com's Online Monetary Transactions Survey, May 1999

Making The Grade

Net Effect Systems, a North Hollywood, California, customer service solutions provider, suggests that e-commerce companies ask the following questions when determining whether their customer service systems are up to snuff:

1. Do we greet new visitors in a way that enables us to recognize them on subsequent visits? Develop an easy and nonthreatening way to identify arrivals, such as a guestbook, and use the information to customize the environment.

2. Do we offer service choices that logically move customers, based on how much assistance they need, from automated to personal service?FAQs can be handled by an automated-response system. More complicated inquiries might require one-on-one chat answers or an actual phone call.

3. Do we have a system that effectively tracks customer activities? Providing the right level of service at the right time is only part of the solution; you also have to track your performance and continually refine it. For example, with effective tracking, you might identify additional FAQs that can be shifted to the automated-response system, making your customer service more efficient.

4. How complete and accessible is our knowledge base? You want your system to work well and your customer service representatives to be knowledgeable. Make sure your e-mail system, online customer-support system and telephone staff have access to necessary company, customer and product information.

5. Are our shopping carts smart? A smart cart will give the customer quick, easy access to service tools as soon as a purchase is made. For example, when an item is selected, a smart cart might ask if it's a gift and arrange for wrapping and shipping. This service will reduce the number of full carts that are left in the aisles, so to speak.

Hot Disks

Placement plus: Feeling lonely lately? Web site not attracting many visitors? Maybe it's because you're not being placed in the best search engines possible. To get more visitors, try Web Site Traffic Builder from Intelliquis (http://www.intelliquis.com). This software program allows you to describe the content of your site in exact terms and control which search engines list your business. It also gives users tools to improve the ranking of their Web sites within search engines. Web Site Traffic Builder ($49.95 street) automatically registers Web sites with more than 900 of the Internet's most prominent search engines, directories and Web registries. Requirements include Windows 95/98/NT 4.0, 4MB RAM and 5MB hard-drive space.

I spy:In today's Web environment, it's important to know more and more about your competitors. How can you keep one step ahead? Try NetGetIt 1.2 from Crossproduct Solutions Inc. (http://www.netgetit.com). This product takes the contact information about companies stored in your GoldMine contact-management database and then, using more than 30 Internet search engines and business databases, combs the Internet and digs deep into each contact's Web site, uncovering information that hasn't even been indexed by the search engines yet. NetGetIt ($99 street for a single-user license) requires Windows 98/95/NT 4.0, Goldmine 3.2 or higher, 24MB RAM and 30MB hard-drive space.

When Customers Aren't Kings

Wondering why your customers aren't coming back for more? Perhaps your Web site just isn't customer-friendly enough. According to a study of the top 25 e-commerce sites, conducted by Net Effect Systems, a North Hollywood, California, customer service solutions provider, few provisions have been made for real-time online customer service and support, which translates into 67 percent of online purchases never being completed.

The study, completed last May, found that while 75 percent of the companies surveyed indicated their e-commerce sites differentiate on service, these companies can't point to a basic service infrastructure or process creating that differentiation. The bottom line? Service and support are afterthoughts driven by technologies, and company priorities have not yet moved to making service a true priority.

By The Numbers

The following are the results of a recent survey of the top 25 e-commerce site companies, as conducted by Net Effect Systems, a North Hollywood, California, customer service solutions provider. These companies:

  • Have a place on their site for self-help: 90%
  • Do not have a defined process for how customers are treated when they come to their Web site: 75%
  • Rate customers' experiences of service and support as better than the competition in terms of speed of service and accuracy: 50%
  • Offer an e-mail process with well-defined service levels for reply: 40%
  • Post a phone number in an easy-to-read place on their site: 25%
  • Have a method for determining why customers leave their Web site before making a purchase: 15%
  • Have a Web-based customer management system: 10%
  • Offer online real-time assistance: 5%
  • Have included online real-time assistance in their top five priorities to implement: 5%
  • Believe the responsibility for e-commerce customer service and support is a full-time, executive-level position: 5%

Contact Sources

Definition 6, jordan.fladell@definition6.com

Jupiter Communications Inc., http://www.jup.com

MCI Worldcom, http://www.wcom.com/services_for_business

Net Effect Systems, http://www.neteffect.com