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Intelligent Virtual Agents (IVAs) are one of the fastest-growing technologies being deployed in retail environments. In key areas like customer support and sales, IVAs can do much of what humans do for less money: According to Forrester Research, it costs $1 for an IVA to converse with a customer vs. $5 for a live chat with a human and $10 to $12 for a live customer support phone conversation. IVAs, which can be programmed to respond to commonly asked questions or commands, have become so technologically sophisticated that Gartner Research estimates that half of online customer self-service search activities for at least 1,500 large enterprises will be performed via virtual assistants by 2015. Endpoint security software E-retailer Kaspersky Lab Europe worked with enterprise-class IVA provider VirtuOz to deploy a customized IVA and avatar named Lena in 2010. Lena was originally designed for customer support, but management was so impressed they expanded Lena into sales in October 2011. “We wanted to provide direct consulting for our customers so they can choose the right product for their needs,” says Michael Neumeyer, director of online operations for Kaspersky Lab Europe. “Another task was to help customers with their questions about the order and billing process in our online shop, as well as with technical questions about our products.” Once deployed across sales and support and integrated with Kaspersky’s existing customer database, Lena was able to provide customized technical support and solutions, delivering “an 81 percent average customer support resolution rate last year,” while reducing call center inquires and e-mails by 22 percent, Neumeyer says. He also notes that in January, “the average order value increased 8 percent.

Tracking capabilities VirtuOz CMO Pam Kostka says her company uses live chat transcripts to “train” IVAs before going live. Algorithms are created that help the IVA identify which products or answers would best suit each individual customer. Examining conversation transcripts allows VirtuOz to “identify conversational topics that the companies didn’t even know their customers were interested in,” she says. “We use that information to go in and retrain the agent/assistant.” Neumeyer says Kaspersky Lab Europe analyzes Lena’s conversations on a bi-weekly basis. “That helps to determine open-end questions from customers so that we can include the correct answers in the database,” he says. VirtuOz has algorithms that allow retailers to track key performance indicators like conversion rates, sales increases, average order value and engagement rates. They also track negative metrics: If an IVA/avatar is not performing well, if people are abandoning conversations before an issue is resolved or a sale is made, the retailer and VirtuOz can identify the problem and retrain the avatar to resolve it. Because Lena is still “very new” to its online shop pages, VirtuOz hasn’t yet determined an ROI, but the company is working to implement Lena in its online shopping cart, as well. “She can answer customer questions about the order process directly while they are ordering,” Neumeyer says. “We hope to get a higher basket close ratio with this.”

Corporate help
European travel website was “having so much success with Lea on the support page of their corporate website “that they wanted to deploy her on Facebook as well,” Kostka says. So last October “They decided to leapfrog the competition by providing a virtual agent that not only directly answers customer questions, but also can channel issues back to live agents to achieve a 100 percent customer resolution.”

A recent study conducted by web-based customer support software provider Zendesk found that 62 percent of consumers have used social media for customer support, with the most active users in the retail, telecommunications and travel/hospitality industries. Deploying an IVA on a corporate Facebook page helps companies move beyond passive social service to active social service, allowing retailers to “respond quickly and in a personalized way to customer requests, comments or inquiries,” Kostka says.

Personal connection
VirtuOz’s IVAs are accessible to consumers using mobile devices and/or logging into social networking sites like Facebook. “We want to make sure corporations, retailers and e-retailers can engage with their customers from wherever those customers spend their time,” says Kostka.

Depending on a company’s size and the volume of calls it handles, saving rates from calls deflected to an IVA range from 20 to 30 percent, she says. The average increase in conversion rates ranges from 2 to 7 percent.

Best of all, perhaps, is how much consumers like IVAs.

“Thirty percent of the time,” says Kostka, “even when you tell a person they are talking to an avatar ... they still believe they are talking to a person. It speaks to the effectiveness of how much the language processing application in a computer can understand and how the computer can bond, in a very natural style, with individuals.”

IVAs “are definitely a great help for customers in their decision making,” Neumeyer says, “and therefore a great help for human sales consultants.”