There’s a revolution happening in ecommerce. Not the kind with pitchforks and torches, but one that's quietly transforming customer service in digital stores from standard to exceptional.
Ecommerce managers are challenging the status quo and rethinking the correct ways to measure success in customer interactions. Hint: the quality of conversations matters more than the speed of closure.
Deflection and closure
Metrics like ticket deflection rates and closure times are understandable. Who doesn't want to resolve customer issues quickly? But there’s a problem if you focus only on these metrics:
You stop seeing every conversation as an opportunity to drive growth and build lasting customer relationships.
If someone doesn’t want to interact with you, they’ll just use your self-service resources, increasing your deflection rate–but improving that metric shouldn’t be your top priority.
For the best quality of customer experience, you should be prioritizing substance over speed. McKinsey reports that:
- 71% of consumers expect companies to deliver personalized interactions
- 76% get frustrated when this doesn't happen
- Personalization drives loyalty, with 76% of consumers more likely to consider purchasing from brands that personalize
While resolving customer issues quickly is important, it's not the only factor that matters. Customers have diverse expectations beyond just speedy resolution. The quality of the interaction is rising up as a key advantage for ecommerce brands that want to attract more customers.
When your only concern is to resolve tickets as fast as possible, it's like trying to speedrun the process of making friends. It’s hard to get someone to like you if you’re always in a hurry to end the conversation. Similarly, while customers appreciate quick resolutions, they also value feeling heard, understood, and genuinely helped.
Deflection leads to missed opportunities and lost revenue
Deflecting tickets might save time in the short term, but it's costing ecommerce businesses big in the long run – and the numbers might shock you.
Cross-selling opportunities exist in approximately 25-30% of customer service interactions. For every four customer interactions you deflect or rush through, you're potentially missing out on one upselling or cross-selling opportunity. In ecommerce, margins are tight and competition is fierce, so that's a lot of money left on the table.
35-40% customer service conversations present potential for upselling (McKinsey). That's nearly half of your customer interactions that could be actively driving a bigger average basket size.
Okay, but how much would it cost to chat it up with every single customer? If your only solution here was to hire new agents, it would cost a lot. And that's where conversational AI comes in to drive those costs down – which we’ll discuss in a moment.
From service to conversation to sales
Customer interaction isn’t just about solving problems, it’s about creating new opportunities. Quality conversation in ecommerce customer service is not about dragging interactions out – it's about making every interaction count.
A meaningful conversation with a customer isn't just about solving problems; it's about creating value. When you engage more deeply, you can uncover upselling opportunities, build loyalty, and learn more about your customer’s expectations. It's the difference between a one-time fix and fostering a long-term, win-win relationship.
Let's look at some real-world examples of ecommerce companies that have embraced this conversational approach:
- Stix Golf – using an AI-powered chatbot, Stix Golf achieved a 56% full resolution rate for customer inquiries, as well as a projected revenue growth of 50%. Why? Because their customer service team was able to focus on high-value conversations that led to sales opportunities.
- Wuffes – this subscription-based ecommerce company used an AI platform to transform their customer service. The result? They cut canceled subscriptions by 10% and now resolve 79% of incoming chats automatically. But more importantly, they're using these interactions to convert free trial users into paying customers.
- EmpireCovers – by focusing on quality conversations, this company achieved a 59% chat resolution rate and saw a significant drop in customer wait times. This improvement in customer experience translated directly to their bottom line.
That's the impact of quality conversations. They transform customer service from a cost center into a valuable source of business growth and customer loyalty.
Rethinking ecommerce KPIs – from deflection rate to conversation quality
Having the right goals is the first step towards achieving better results. Ecommerce KPIs need an update. Instead of focusing on ticket closure and deflection rates, consider these metrics that align with business growth goals:
- Upsell and Cross-sell rates – track how often customer interactions lead to additional purchases.
- Revenue per Conversation – this directly ties your customer service efforts to your bottom line.
- Customer Satisfaction Scores (CSAT) – happy customers are repeat customers. And in ecommerce, repeat customers are gold.
- Net Promoter Score (NPS) – this measures how likely customers are to recommend your brand. Word-of-mouth has always been one of the most effective marketing tools.
- Customer Lifetime Value (CLV) – this metric looks at the long-term value of a customer, not just the immediate sale.
Companies prioritizing and optimizing for customer satisfaction, loyalty, and happiness-related KPIs tend to outperform those focusing solely on traditional operational metrics. Studies have found that customer satisfaction metrics have a significant positive impact on a firm's financial performance and market value (Marketing Science).
Enhancing human conversations with AI
How can you possibly have meaningful conversations with every customer without breaking the bank? Modern, conversational AI comes to the rescue.
AI isn't here to replace human agents. Instead, it's here to enhance their capabilities and free them up to focus on what really matters – those high-value, revenue-generating conversations.
Here's how:
- Automating routine tasks – AI can handle simple, repetitive queries, allowing human agents to focus on more complex issues and sales opportunities.
- Providing real-time insights – AI can analyze customer data in real-time, giving agents the information they need to personalize interactions and identify upselling opportunities.
- 24/7 availability – AI agents can engage with customers around the clock, ensuring no opportunity is missed.
- Continuous learning – AI systems learn from each interaction, constantly improving their ability to assist customers and support agents.
This isn't just about feel-good customer service. Companies that view customer service as a value center achieve 3.5 times more revenue growth compared to those treating it as a cost center (Accenture).
What does this look like in practice? Take MODIVO, a leading online fashion retailer. After implementing an AI-powered platform, they achieved impressive results:
- 97% of customer inquiries recognized by AI
- 46% chat resolution rate (reaching 55% in several markets)
- 47% drop in average resolution time
The most important part is that these improvements allowed MODIVO's team to handle more complex inquiries and focus on sales opportunities. They're no longer just resolving tickets, they're actively driving growth.
Customer retention VS acquisition
Customer acquisition costs can be steep.
Acquiring a new customer is anywhere from 5 to 25 times more expensive than retaining an existing one (HBR). By investing in quality conversations, you're not just solving immediate problems – you're building loyalty that pays dividends over time.
Increasing customer retention rates by 5% increases profits by 25% to 95% (Bain & Company). In ecommerce, switching costs for customers are low, so retention is a key driver for continued growth.
That's why retention is so crucial – and meaningful conversations are a cost-effective way to keep customers coming back.
Are you ready to start the conversation?
It's time to stop seeing customer interactions as costs to be minimized and start seeing them as opportunities to be maximized. Ecommerce needs to shift from closing tickets to opening conversations.
Are your CX metrics driving the kind of growth you want to see? Are they building the customer relationships that will sustain your business in the long term?
Every customer interaction is an opportunity to create a loyal customer, to drive a sale, to build your brand. Stop deflecting, start engaging.
If you’re ready to unlock the revenue streams hidden in your customer conversations, let’s start the conversation.
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