Ever gone online to make a big-dollar purchase — a phone, a computer for example — and gotten almost to the end, but then aborted because you still had questions?
We’ve been there. Often, we end up calling a live customer service person, to double-check things like the length of warranty, the credit plan, or number of free minutes.
InQ, a Los Angeles company, detects when a customer has neared the end of the shopping process, and pops up a screen and offers to engage the customer in live chat. The customer service person also picks up the phone, if requested, to answer the customer’s last-minute questions. InQ claims to have increased sales 25 percent for big customers like Sprint and Bellsouth. Really? “It’s mind-boggling,” says Jason Green, venture capitalist at Emergence Capital, “I didn’t believe it myself.”
Tomorrow, inQ will announce it has raised $7.75 million a third round of funding, led by Green of Emergence Capital, and Partech International. Existing backers, Dolphin Equity Partners and Hudson Ventures also participated.
The company says the e-commerce shopping cart abandonment rate is about 40 percent. That gives it a strong market, even if the real number is half that.
InQ only gets paid if customers use it. It serves clients with high-priced goods, though, so typically gets paid between $25 and $100 per deal it closes.
Emergence’s Green said it inQ is better than competing service LivePerson. Live Person, he says, forces companies to use their own employees to conduct the chat or calls, but they may not have the training to do that. inQ’s chats are all conducted by inQ’s representatives, 55 of them sitting in Los Angeles.
Notably, inQ reports that half of shoppers agree to the chat.
Tags: co:Inq, deal, inv:Dolphin-Equity-Partners, inv:Emergence-capital-Partners, inv:Hudson-Ventures, inv:Partech-International3 Comments
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preston said:
It sounds like a product that would only appeal to a few retailers with a very general product line. In any kind of niche you would want agents specifically trained on all of your products - I would never trust a third party to handle my customer service.
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Chris said:
It’s interesting that it says half of the shoppers agree to chat, but I wonder how many of them would have continued their purchase without the chat option.
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Leon said:
The InQ service is excellent for (but not limited to) the type of sales generated by telemarketers like phone services, credit cards, and other large total payment services or even high priced goods. InQ is offering such a service without the phone ring at your dinnertime but rather when you most need the help - while completing a transaction. That is certainly a welcomed change.
According to Direct Marketing Association, telemarketing is the largest segment in the direct marketing space. I believe it was around $90 billion in the year of 2004. Of course InQ can only take a very small part of the market as they are serving only those who almost completed an online transaction. Nevertheless it will not be surprising to see that there is a sufficiently big and growing market for an online business in this space.
