Management & Finance

Manual Texts Recover 21 Percent of Abandoned Carts, Says LiveRecover Founder

Dennis Hegstad believes the best way to recover abandoned carts is via text messages. But his messages are not automated or bot-driven. Hegstad’s company, LiveRecover, sends one-to-one texts from a real person to folks who have left an ecommerce checkout without completing a purchase.

“It’s peer-to-peer texting,” he told me. “We’ll send messages from a real person. It’s not a drip campaign. About 55 percent get replies. Our total recovery rate on average is about 21 percent, which is really good.”

The notion of using SMS for abandoned carts is not new. But using humans to do it individually is unique. I recently spoke with Hegstad about his company and the rise of commercial SMS, among other topics.

What follows is the entire audio of our conversation and a transcript, edited for length and clarity.

Eric Bandholz: Tell us about LiveRecover.

Dennis Hegstad: We do SMS marketing with a focus on recovering abandoned carts for ecommerce businesses on Shopify, WooCommerce, and other platforms.

It’s peer-to-peer texting. We’ll send messages from a real person — “live texting agents” is what we call them. It’s not a drip campaign.

The agents are mostly based in the Philippines. They can type a certain number of words per minute, they speak English as a first language, and they’ve had some ecommerce experience.

Bandholz: How do you convince recipients that the message is coming from a human and not a bot?

Hegstad: We encounter a lot of people who will joke with our agents and say like, “If you can prove that you are real, I’ll buy.” And then we’ll respond with a funny SpongeBob meme, such as, “Give me all your money” or something like that. And they’re like, “This is so cool. I thought this was a bot. You guys have great customer service.” But, for sure, many people assume that it’s automated.

Bandholz: So your agents send messages to abandoned carts. How many of those are converted to orders?

Hegstad: About 55 percent get replies. Our total recovery rate on average is about 21 percent, which is really good.

We don’t text 24 hours a day. There’s a quiet period when we cannot text. No one’s texting after 9:00 p.m. and before 8:00 a.m., per the recipient’s time zone. There are regulations around that.

Bandholz: Can shoppers text your service for general queries? Or is it just purely abandoned carts?

Hegstad: Right now, it’s just abandoned checkout recovery. I say “checkout recovery” because we collect the phone number at the checkout, not in the cart. But we are adding live agent support, so a merchant could have a widget that says, “If you have a question about this order, text in, and our agents will support you.” But that requires us to get more integrated with the stores on a customer service level because if shoppers are asking things live, we need answers on hand.

Bandholz: We did a little bit of that at Beardbrand. We had our live chat box that was connected to a bunch of people overseas. They didn’t necessarily understand beard grooming questions. Plus, those widgets are intense resource hogs. They add so much time to loading a page. So we killed our live chat altogether.

So, instead, we published a banner that says “Text ‘style’ to this phone number.” We have an in-house community manager who will receive the text and reply to that.

Hegstad: That makes sense. We’re in this wild west era of SMS marketing, which is fun and exciting. Everyone’s rushing to do SMS, whether that’s abandoned cart recovery or creating an SMS list, or winning back a customer.

But we don’t know what the long term value will be, what the duration of a customer subscription is on email versus SMS.

SMS is great now, but it’s going to become less commercial and more concierge, real-time, and personalized, versus just being a transactional machine that reminds you to buy stuff. I don’t think consumers really want that. They want to have questions answered. So, you have to be a little sensitive about how you’re using SMS for the long term.

Does Beardbrand use SMS for abandoned cart or welcome series?

Bandholz: No. For SMS, all we do is consultation. But we’re going to test promotional texts soon. We’ve got a new product launch coming up. We may do an SMS campaign to let people know about it. It would probably link straight to the product page, especially mobile.

But your company doesn’t offer a promotional text service?

Hegstad: No. We want to be the best at abandoned checkout recovery.

Bandholz: How do phone numbers work? If I’m a LiveRecover customer, can I pick a phone number for my texts?

Hegstad: There are two types of phone numbers. One’s called a short code, which is essentially a three, zero, three, zero, three, which is a commercial phone number where you can send tens of thousands, or hundreds of thousands, of texts per minute.

There’s another number called a long code, which is a more standard phone number. If you send hundreds of texts per minute from that number, you’ll get flagged by a carrier, which will likely impose a cool-down period when you can’t use the number.

So for LiveRecover, our customers don’t pick their phone number. We do all that for them. But they do get a number that’s used in relation to where the customer is. So if you live in Texas and you abandon cart, you would be getting a text from a Texas number. If you live in Florida, you’d be getting a text from a Florida number. One customer doesn’t have a dedicated number. They’re rotated out in a big pool amongst all our customers.

And, yes, there’s a much better reply rate with a local number because people recognize it.

Bandholz: Does LiveResponse have copycats?

Hegstad: Yes. It’s a bit annoying, but at the end of the day, no one is going to be in first place by chasing the person in front of you. And we’re not trying to reinvent the wheel either. Mailchimp was here when we launched, as was Attentive and SMSBump. Now there’s a slew of competitors. We’re not upset with that. We think, “Good for you guys. You did a great job.”

But when people copy and paste the copy that our team wrote and bid against your keywords on Google, that’s just scummy. I’m cheering for Postscript, for example, which is a competitor. But I’m not cheering for anybody that’s copying and pasting my work.

Bandholz: How can people connect with you and learn more about your company?

Hegstad: LiveRecover.com is the website. We offer a $500 free trial. You don’t need a credit card to sign up. If you want to talk about SMS or listen to me about life, go to @dennishegstad on Twitter.

Eric Bandholz

Eric Bandholz

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