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March 29, 2023

Chatbot vs live chat: Which is better ?

Effective and prompt communication with customers is crucial for the success of a business. Among the various ways customers seek assistance, chat support is becoming increasingly popular compared to self-help guides or FAQs. According to data from 99 firms, almost half of customers today prefer using chat for product or service inquiries.

However, a common question businesses have when considering chat support is whether to use live chat or a chatbot. This article provides the key information you need to make an informed decision about which option, live chat or chatbot, will best improve customer experience for your business.

Live chat vs chatbot

Live chat offers customers a convenient way to communicate directly with company representatives and have real-time conversations about pre- or post-purchase inquiries. Typically, businesses that use live chat have a dedicated team of customer support staff available to handle interactions.

On the other hand, chatbots are artificial intelligence-based interfaces that mimic human interactions with customers. When a customer raises an issue, chatbots will analyze the message and respond by selecting the most appropriate answer from a pre-programmed database. The technology behind chatbots can be complex, so many companies outsource their operation and maintenance to specialized firms like Algomo that specialize in automating customer service.

Human involvement from company staff is only required when the customer prefers to speak to a human agent, or the chatbot is not yet advanced enough to answer all questions accurately due to technological limitations. Companies like Algomo ensure that the transition from chatbot to human agent is as smooth as possible to minimize disruptions.

How to choose between chatbots and live chat?

Both chatbots and live chat are frequently employed by businesses to enhance their customer service. While using both can make your customer support more complicated and expensive, here is a comprehensive list of factors to consider when making a decision about which one to use.

Handling capacity (chatbot wins)

Because live chat involves a high degree of human agent participation, it tends to have a lower handling capacity than chatbots. Usually, human agents can only manage a maximum of 3 to 4 concurrent chats at a time, while chatbots generally have no limitations on the number of chats they can handle simultaneously.

This makes the handling capacity of live chat highly dependent on the number and availability of human agents. During periods of staff shortages, businesses that use live chat are more likely to experience delays in responding to customer queries. Research by Hubspot found that 90% of U.S. customers consider an immediate customer service response to be "important" or "very important."

Therefore, assessing expected customer service demand will help you make more informed decisions between live chat and chatbots.

Cost-effectiveness (chatbot wins)

The discussion of handling capacity naturally leads to the topic of cost-effectiveness. Since chatbots have a much greater handling capacity than live chat, they are likely to be more cost-effective if their capacity is used to its fullest potential.

Implementing a chatbot typically only involves an initial cost of installation, while operation and maintenance costs are minimal. In contrast, running live chat requires costs for hiring and firing staff, purchasing equipment like computers and headphones, and most importantly, salaries.

Unless your business only receives a small volume of queries that can be handled by one person, chatbots are usually the more cost-effective option for maximizing efficiency.

Ease of implementation and use (draw)

Live chat is software that can be easily downloaded and installed on computers, but it may take some time for agents to learn the different features of the interface and adjust to the system.

The installation of chatbots may seem intimidating, but companies like Algomo offer chatbots that require no coding and can be easily integrated into your website. There may be some maintenance issues that require the assistance of technicians, but there is no need for staff training.

Fast response (chatbot wins)

Given that chatbots can operate 24/7 while human agents have fixed working schedules, chatbots have a clear advantage in providing quick responses to customer inquiries at any time. Chatbots are able to provide instant responses to all customers simultaneously, eliminating any waiting time for customers.

With live chat, customers may have to wait to be connected to the appropriate agent. Also, unlike chatbots that can be programmed with a vast amount of information to answer various customer questions, customer support teams may not be equally well-equipped with the knowledge required to answer customer questions promptly and with high quality.

If your business operates across different time zones and receives a wide range of queries, chatbots can help minimize customer frustration from long wait times for customer service.

Handling complex issues (live chat wins)

When it comes to handling complex issues, live chat is the clear choice. Chatbots' ability to handle complex concerns depends on the quantity and quality of data fed into them for machine learning. However, no matter how well-trained chatbots are, it is unlikely that they will be able to think and respond logically like real humans in the near future. For this reason, most chatbots have features that allow for seamless transitions to human agents.

When dealing with complex issues, live chat agents can collaborate with other teams and discuss the best solutions for customers. This also allows for greater flexibility in addressing problems. Therefore, if your business is likely to receive queries that require personal attention or one-on-one interaction with customers, live chat is the better option.

Key takeaways

When considering the five factors outlined above, chatbots are a better option for businesses with a large scale if you want to allocate more resources and time to other important areas such as marketing and product development. However, human interaction is often necessary to build a closer connection with customers. Human agents play an important role in resolving complex issues. In conclusion, there is no universal solution for automating customer service. Careful consideration of your business and customers is necessary to make the best decision between chatbots and live chat.

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