How Much Revenue Does Chat Convert for HVAC Businesses?
👋 Hey, Jon here! There are so many new readers here (shout out to ALL of you!), so I revamped the About page to this newsletter, which lists the most popular articles based on readership. So if you’re new make sure to check it out so that you don’t miss any killer data insights!
Today’s newsletter is about how well chat tools convert revenue for HVAC contractors. We now know that 78% of leads from PPC marketing convert via Phone Calls on average, but a growing number of customers want different options to convert on your website.
If you’re looking to get 1% better each month, this is a good breakdown of how a chat solution could be the answer, and what you need to do to make the most of adding chat to your website (especially if you already have a chat tool on your site today).
The below insights are based on PPC lead data from 13 HVAC contractors with a chat tool on their website from August 1st through October 17th.
Chat Converted 4.1% of Leads from PPC
Of more than 11,200 leads generated by Google and Bing PPC from August 1st through October 17th, 4.1% of those leads converted via a chat tool on the website.
That means for every 100 leads generated, 4 of those customers converted via chat tools on HVAC websites that offered it as an option.
Here’s how that stacks up against other conversion tools:
📱Phone - 79%
🖊️ Form - 11.1%
📅 Online Scheduling - 5.8%
⌨️ Chat - 4.1%
Phone is still the dominant conversion tool (no changes in the trend there).
And while it isn’t true to say that 4.1% of leads wouldn’t have converted at all if there were no chat option on the site, you can probably assume at least some customers wouldn’t have converted without the ability to chat.
Chat Leads Had a Match Rate of 51%
This is where the data gets really interesting.
A lot of people have reached out to me asking if chat actually drives quality leads or if it is just a bunch of spam.
Based on this sample, it’s very clear that chat drives high quality leads - 1 of every 2 leads ended up in the CRM with revenue attached to it.
However, match rate is highly dependent on how well you manage the chat tool.
If you have chat on your site, but don’t respond to the leads, match rate will obviously be much lower.
But if you, someone on your team, or a vendor responds to chats in a timely manner and provides a good customer experience, you can expect a high percentage of those leads to convert to a sellable opportunity.
Let’s see how chat match rate compares to the other conversion tools:
📅 Online Scheduling - 67%
⌨️ Chat - 51%
📱Phone - 32%
🖊️ Form - 31%
Both online scheduling and chat have significantly higher match rates than phone and form leads, a trend we’ve seen since we started tracking this data on our platform.
While online scheduling and chat converted less customers from PPC those conversions are higher quality based on this data.
Chat Leads Had a Booked Job Rate of 33%
For every 100 leads converted by chat, 33 of them turned into a sold or closed job.
We call this booked job rate.
It’s a much better metric to use than cost per lead, because it tells you the percentage of leads that become a paying customer.
Let’s look at how booked job rate compares across all conversion tools:
📅 Online Scheduling - 50%
⌨️ Chat - 33%
📱Phone - 24%
🖊️ Form - 22%
Online scheduling tools are extremely efficient at converting revenue, but chat is second on this list, with a booked job rate 9% higher than forms and 11% higher than phone calls.
Chat Drove an Average Ticket of $6,043.36
When we evaluate the performance of a conversion tool, we are looking at 3 KPIs in particular:
Match Rate - indicates the quality of leads and how well they are being managed
Booked Job Rate - indicates the quality of your sales process
Average Ticket - indicates the quality of the customers and jobs that closed
These metrics tell a story (we call it revenue flow) and can help you quickly identify and solve specific problems that are blocking the flow of revenue to your business.
In the case of leads converted by chat, we are seeing relatively high match rate and booked job rate, as well as higher average tickets.
Forms converted the highest paying customers, but chat was a close second, with an average ticket $2,541 above the average ticket from leads that converted by phone:
🖊️ Form - $6,315.74
⌨️ Chat - $6,043.36
📱Phone - $3,502.21
📅 Online Scheduling - $3,395.98
Chat Generated $946,244 in Sold and Closed Revenue
Leads don’t show up on your bottom line, revenue does, so let’s look at that data by conversion tool for this sample:
📱Phone - $7,370,242 (66.4% of revenue)
🖊️ Form - $1,705,372 (15.4% of revenue)
📅 Online Scheduling - $1,087,706 (9.7% of revenue)
⌨️ Chat - $946,244 (8.5% of revenue)
Chat generated the least amount of revenue across phone, form and online scheduling, but it did generate 8.5% of the sold and closed revenue on just 4.1% of the leads.
66% of Revenue Opportunity Converted by Chat Was From New Customers
The majority of revenue opportunity (the sum of unsold estimates, sold jobs, and closed jobs) converted by chat was from new customers.
Let’s see how that compares to other conversion tools:
🖊️ Form - 77%
📅 Online Scheduling - 71%
⌨️ Chat - 66%
📱Phone - 64%
Keep in mind, every PPC strategy is different - the accounts in this sample are heavily focused on unbranded search terms, so it’s not surprising to see a high percentage of those leads come from new customers.
Chat didn’t quite drive the same percentage of new customers leads as forms and online scheduling, but on average, six out of ten leads converted by chat were new customer opportunities!
Closing Thoughts
If you want more leads, you first want to think about how to optimize your website to convert more of your visitors into leads (adding chat can be a great way to do this).
Second, you’ll want to make sure you optimize that conversion tool.
You might already have chat on your site, but if it’s not managed properly, there could be big gaps in your performance from the benchmark data.
For example, a sub-set of HVAC contractors in this example saw much lower revenue generated from chat because their match rates were under 30%!
That is why it is so important to track match rate, booked job rate and revenue generated by conversion tool because the answer could be more about how leads are managed than the conversion tools offered on your website.
Lastly, I’ll share one fascinating nugget from this data I picked up while playing around in our tool:
Bing leads converted by chat drove a significantly higher revenue opportunity ($403,933) than online scheduling ($208,220).
I’ve written about Bing being a sneaky underrated paid marketing channel, but it’s fascinating to see how those leads convert differently on the site.
As you deploy different marketing channels as part of your strategy, understanding how the leads from those channels convert differently can help you make better optimizations on your site to maximize your revenue.
Until next time….
-Jon