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Live Chat Tool Competitive Analysis


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Research and analysis of the live chat market.

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Live Chat Tool Competitive Analysis

  1. 1. Competitive Analysis Researched and compiled by: Aaron Gerry 10/17/16
  2. 2. Competitor Analysis Brief - Introduction Direct Competitors Overview // Aaron Gerry conducted a competitive analysis on the live chat Saas market to see what other products offer 1:1 customer to business chat functions in order to improve support and increase sales. This was conducted in October 2016. The goal of the review was to identify opportunities and gaps in the current market, and to look into future possibilities with the advent of AI, chatbots, and ubiquitous messaging. The lens with which I went into this audit was to understand the market as a whole, and X’s position as a later entrant. I approached the reviews as a potential customer might, looking at on-site messaging, the UX of the product, and in some cases, the customer support. You can find the raw data in the spreadsheet on the last page. Intercom LiveChat Olark LivePerson Olark Smooch Indirect Competitors Hubspot Boomtrain Influencers Market // The category types I reviewed: Full-Suite Platform: These products offer an array of tools and functionality, wrapped into one. Standalone Chat: These products specialize in live chat, with a myriad of features built around this core. Bot-Centric: These products fundamentally differentiate by building a smart backbone, of which chat is built on top. Kit
  3. 3. Direct Competitors Intercom Zopim Smooch Description // Aim to be the "center of all customer communication." Their value prop: One unified live chat + help desk + email marketing + CRM + user analytics toolset, making tracking users and acting on behaviors much easier… Pros // Well regarded by customers for the life cycle management capabilities and tracking of usage of the product (i.e., onboarding, capturing slipping leads). Breadth of behavioral analytics. Insight into how customers are using product. Cons // Complicated product to sign up for. Not the best individual tools. Pricing is complicated. Unfriendly brand and somewhat robotic experience through onboarding. Must chat through dashboard or app. Description // Quick to setup and easy to use. Truly free option. Zopim was acquired by Zendesk in 2014 out of Singapore. Large international customer base (41% of total), where messaging app behavior is more common; Positioned for expansion, especially Asia. A market leader (8.5% market share according to LiveChat investors report). Pros // Clear and simple on-site messaging; E-commerce focus (i.e., integration to track chat to sales conversions). Early Facebook messenger partner (Zendesk); Easy signup via information architecture and educational materials (never feel lost or uncertain). Cons // Limited integrations (seems intentional to encourage use of Zendesk); Must chat through dashboard or app. Description // Smooch is an indirect-direct competitor. Product has chat, but primarily building a platform (integrated communication-channel). They claim to be the "first cross-channel web messenger," where conversations/ customer data syncs seamlessly. Cater to chatbot early adopters (sample bot out of the box + integrations with Motion AI). Pros // Delightful sign up and on-boarding experience (Smooch Bot guides you, shows value/ use case of bots). Dynamic actions within messages (i.e., schedule appointment, purchase in one click). Robust dev tools. Cons // Tech-centric (need to have the technical chops to really take advantage of this); Expensive; No CRM integrations (yet).
  4. 4. Direct Competitors LiveChat Olark LivePerson Description // First and foremost a customer service product, focus on bringing live messaging to the support desk. Business case around saving time and money, increasing sales. Target customer has small support team (1 - 5ish). Strong content. 55% of biz outside U.S., positioned for growth in Europe. Claim they have 7% of the market. Pros // Easy to understand value proposition (on site); Simple to use product; Highly rated across a variety of review sites; Large integration pool; Using content and inbound techniques well. Cons // Basic product with limited functionality. This is for a very non-techy person. Description // Focus: Customer support and ease of use. The most simple tool to set up (of reviewed tools). Target customer <4 support reps. Demonstrably startupy brand: Emphasize personality, intentional about showing culture. Bootstrapped. Thought leadership in small biz crowd (organizer of Small Business Web Summit). 7% of market (LiveChat report). Pros // Attuned to customer and needs; Treatment of team extends to treatment of customers; Personable brand; Deep integrations with partners (Groove’s live chat built by Olark. Area for growth?); Strong WOM. Cons // Severely limited integrations; Slow product dev (just released a mobile app in July); Will they still be a major player? (touting 10,000 customers since 2014). Description // Major player: 22% market share (LiveChat report). Fortune 500 clientele; Product likely customized for each customer. LiveEngage (tool) 1 year on market, won a SIIA CODiE Award. Don't really sell the service on their website + limited online reviews suggests focus on enterprise clients (i.e., upselling existing customers). Pros // Unique features: Call-to-text customer support, expectation setting, and sentiment analysis. Enterprise scalability and security; Partnership with GoDaddy to provide live chat (14 million customers). Cons // Will this be a core focus of biz? (Sufficiently different customer than Fortune 500); Expensive for companies with 1-3 support reps, slow product dev (mobile apps last updated November 2015).
  5. 5. Direct Competitor - Full-Suite Platform Intercom Clearly articulated product offering. Painful sign up process for free trial.
  6. 6. Direct Competitor - Standalone Chat Zopim Tutorials built into onboarding. Limited integrations. Can’t Find CRMs.
  7. 7. Direct Competitor - Standalone Chat Olark Only company that puts team front-and-center. Are they growing? Actively tries to engage you via chat.
  8. 8. Direct Competitor - Bot-Centric Smooch Smoochbot guides you through onboarding! Rich, dynamic messaging. Actions and messages sync across platforms
  9. 9. Indirect Competitor - Bot-Centric Boomtrain AI-powered marketing. 1:1 human touch. Ridiculously expensive. Deep behavioral tracking and insights.
  10. 10. Indirect Competitor - Full-Suite Platform Hubspot Deep integration with customers business’ (and getting more so). Major investment in tools Expensive if you want the whole package
  11. 11. Influencers - Interesting Bot Applications Troops Bot does work for you: Pulls up sales data. Ridiculously expensive. Kit Bot does work for you: Performs marketing activities
  12. 12. Competitor Analysis Brief - Summary Direct Competitors Current Marketplace // There are many existing players in the live chat space, however this is a growing market with expanding borders. eMarketer expects the total global number of messaging app users to increase from 1.4 billion in 2015 to 1.6 billion this year. In a 2015 report, AppAnnie revealed those aged 13-24 spend more than 3.5 times overall usage time in messaging apps compared to those over 45 years old, and 25–44 year-olds spent the most time in the top 5 retail apps (over 2 hours/ day). Mobile adoption continues to increase, messaging app usage is becoming more prevalent, and expectations around what you can do in messaging apps is changing (thanks to FB Messenger, Kik, etc.). This is not going away. Intercom LiveChat Olark LivePerson Olark Smooch Indirect Competitors Hubspot Boomtrain Influencers Opportunity // Kit Increasingly, the challenge for companies is about capturing customer data and making sense of it, in order to take an action. Most of the reviewed tools simply present the information to the user, but don’t offer insights or recommendations from the data itself. The tech-savviness and needs of customers varies drastically from venture-funded startups, to Fortune 500, to non-employer small businesses (of which 23.0 million such businesses exist in the U.S). Currently, companies offer either a suite of tools or standalone chat tool, with Intercom offering the most differentiated option. The specialized chat tools are generally fungible. There is a huge range in needs and customer ability, and the competition is not close to catering to all demographics. Chat could become the new browser. It’s not far-fetched to envision a majority of search occurring through a messaging app (though this is a long way off). Bots are the hot topic, but the average person does not have the skill, time, or know-how to impliment a bot of their own (however companies like are trying to make this easy). Most products don’t yet offer bots.
  13. 13. Competitor Analysis Brief - Recommendations Direct Competitors Recommendation // 1) Own the blended bot + human double team // Bots are nascent and the experience is less than smooth. Identify the repetitive customer support tasks that can be “outsourced” to bots and hone in on touch points where humans make a meaningful impact. Let humans be human, and do what humans do. 2) Make the bot work for the customer support reps // The customer support rep’s most finite resource is time. Current products make managing conversations easier, or engage directly with the inquiring user, but they don’t necessarily help with customer relationship or offer in message support. There are not bots designed to make the customer support reps job easier, whether it is asking it for additional customer data, searching for relevant FAQ’s, etc. Think Troops or Kit for support reps. 3) Use data to provide recommendations // There is a wealth of customer information, behavior, lifetime tracking, etc. that these tools can capture. Yet, for the busy small business owner of customer support rep, the data is simply there to be sifted and sorted; The tools do not (typically) recommend who to reach out to, trends in customer drop off, etc. 4) Better in-message support // Incorporating a service like Crystal would be interesting, as it would allow support reps to be able to better assess the situation, and how to talk to the user. 5) Have a position in the market // No one is making the claim of “We are X for Y;” All the messaging is very generic. Some products target e-commerce or Fortune 500, but there are no strong, opinionated positions. Intercom LiveChat Olark LivePerson Olark Smooch Indirect Competitors Hubspot Boomtrain Influencers Kit
  14. 14. Methodology and Additional Resources Direct Competitors Methodology // The first step was to identify companies to research further. I approached the search as a customer might, by asking friends what tools they use, searching google, surveying review sites, reading accounts on Quora, reddit, Product Hunt, etc. From here, I did a cursory review of nearly 20 tools, and selected the final 8 based on quality and volume of reviews, recommendations, longevity, market leadership, and those with an interesting position or direction. Again, from the perspective of a potential user, I explored the site, sign up and on-boarding process, paying attention to messaging and the UX. I captured the information in the spreadsheet below. Competitive Analysis Spreadsheet: ng Intercom LiveChat Olark LivePerson Olark Smooch Indirect Competitors Hubspot Boomtrain Influencers Kit Limitations // I wanted to speak with more customers of X, to understand how they use the product and how they made the buying decision. I identified potential customers via those featured on site, commenters on Product Hunt, and people who shared tweets about the product. Many ended up using a competitor, and of those I reached out to, I only heard back from a handful. Proposed Next Steps // If I were to continue, I would speak with additional customers, customers of competitors, and those looking for a live chat tool to gain deeper understanding of needs and identify customer personas.