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Chat is the Secret Weapon for DTC Brands

Adriana Krasniansky

Retailers, let’s talk about the the behemoth in the room: Amazon. In the first half of 2017 alone, nearly 700 U.S. companies mentioned the retailer in their quarterly reports, and some analysts expect the giant to make up half of U.S. eComm business by 2020.

Yet, loyalty to Amazon leaves much to be emotionally desired: 64% of customers say low prices are their motivation for shopping on Amazon, with free shipping (60%) coming in second. Because Amazon doesn’t build a relationship between consumers and their purchases, they move products on price and convenience.

Ironically, Amazon’s dominance has left a white space in the eCommerce ecosystem for merchants to sell on a different value proposition: customer-brand relationships.

DTC: A high-value opportunity

The best way for a brand to own the customer relationship is to engage through a direct-to-consumer (DTC) channel, such as a website or app that sells the company’s products and services without any middle merchant or marketplace. DTC retailers and Digitally Native Vertical Brands (DVNBs) that have their own eComm storefront have the benefit of engaging directly with shoppers throughout the shopping cycle.

By owning the entire shopping relationship DTC brands can sell based on the value of their digital presence. This involves not only price and convenience, but the entire customer experience—from branding and customer support to guided selling and personalized service.

If executed correctly, DTC affords brands the ability to directly communicate and learn from their customers, while having greater control over driving conversion and telling their story. Customers benefit from a more tailored and emotionally rewarding experience. With these value drivers at play, DTC channels are less reliant discounts or incentives to drive sales—as Shopify points out, in 2018 numerous DTC leaders had their best holiday seasons despite running minimal-to-no promotions.

Retail is a conversion and margin game. DTC allows brands to stay engaged with customers throughout the entire shopper journey, driving conversions and supporting higher AOV.

Chat: Building engagement into your DTC channel

Armed with a direct channel to customers, brands must still invest in building a digital infrastructure that drives meaningful engagement. Meaningful engagement involves:

  • Interaction as soon as a customer wants, needs, or expects it
  • A two way interaction that intakes customers’ input and responds with relevant information
  • Resolved with a response (product, service, guidelines, or content) that matches customer intent

The most straightforward way to deliver on these components of meaningful engagement is through live chat on your platform—guiding a one-to-one expert conversation that couldn’t be afforded on a multi-seller marketplace like Amazon.

Unlike other high-investment engagements such as guided selling and custom-built digital apps, retailers who engage with customers via chat pre-purchase on average see a 60% increase in order value and 40% increase in conversion rate.

Retailers who engage with customers via chat pre-purchase on average see a 60% increase in order value and 40% increase in conversion rate.

Make conversational your brand’s secret weapon

Chat is only as effective a tool as you make it to be. Conversational AI solution Caravel seamlessly integrates into standard chat clients (Intercom, Zendesk, and others) and turbocharges your chat to deliver a higher engagement experience that drives conversion, increases order value, and reduces returns while improving customer loyalty.

At Caravel, we’ve collected a few tips about how to purpose-design chat to deliver the maximum value for customers—enough to drive them back to your platform again and again for tailored service.

Invest in quality conversation

92% of shoppers would stop purchasing from a company after three or fewer poor experiences. Review your current chat and email logs to pinpoint top customer concerns, priorities, and requests, as well as feedback about how they would like to be engaged. Designing your engagement around customers from the start seeds a high-quality experience.

Meet your customers where they are

DTC conversations already have the benefit of engaging customers on-platform, allowing them to speak as they’re in their natural shopping behavior.

Now, chat smart: apply contextual awareness about a customer’s shopping before and as you engage with them. Determine the best page to strike up a conversation—is it a product category page? The sizing chart?—and identify behaviors (switching between product pages, adding two sizes to cart) that might indicate a customer need for you to address.

Prioritize high value interactions

Tools like Caravel allow you to offload the most common questions and needs, such as sizing and fit, styling, or gifting, and answer automatically. Use this to free up your CX team to step in when a customer presents a high-value need or looks especially likely to abandon a purchase—a moment that Caravel’s AI can help you pinpoint.

Exercise your brand voice

If your DTC website is your digital storefront, then chat is your best sales associate. Make sure your conversation is designed to speak in your brand tone, surfacing the same high-quality information—brand story, product education, industry knowledge from your team—that a customer would receive in store.

...But bring in other voices too

Shoppers are 6x more likely to purchase based on another customer’s recommendation over yours. Caravel allows you to bring customer reviews and social posts into the conversation—leveraging the great feedback you’ve received to help you meet a customer’s specific needs and build confidence towards purchase.

Support each shopper all the way through conversion...and beyond

Conversational shopping shouldn’t end by dropping the customer off at a product page. Make sure each customer feels confident that they are choosing the right item, size, and style, and that they are comfortable with shipping and details, all the way through purchase. By continuing the conversation all the way to checkout, you can not only encourage follow-through but can also identify the top moments of drop-off.

Add a high-touch service by remembering and celebrating each customer when they return for another purchase. Caravel enables you to store key information like size, taste, and top concerns and resurface that information in subsequent conversations as appropriate, to build a long-term, high-value relationship directly with your shoppers.

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