Company adds personal touch to Internet shopping.

Internet chatting is as old as the Web itself. But to Steve Nober, it's also a good way to service his clients.

It was just two years ago that Nober's online marketing firm InQ began using Internet chat as a way to improve online sales for their clients who operated e-commerce sites. It was a gimmick, to some, but it was a big idea that would get even bigger.

The company provides a so-called "upsell" service or the ability to sell items or service like shopping coupons or joining a DVD program after online shoppers head to the checkout page.

"What makes us unique is the fact that we're the only ones who offer an online upsell chat," Nober said.

While other services offer static pop up upsell browsers, InQ provides a separate browser where the image of an online operator appears allowing the shopper to chat in real time with the operator.

Although most shoppers will ignore additional deals, the few that do are generally enough to make the upsell service worth it.

"For us it's pure cash flow because we don't have to do a single thing," said Robin Podielsky, general manager of aftermarketing for Los Angeles-based direct marketing firm Sylmark.

On its sylmark.com site, the company reports its upsell "conversion rate" of about I0 percent meaning about 10 percent of those checking out agree to an additional purchase during the online upsell chat.

"That 10 percent is fabulous for us since with our previous upsell service provider we were getting just a fraction of that," she said.

Typically, InQ converts about 10 to 20 percent of customers with its upsell offers, but even with that percentage, InQ customers realize that the small percentage means revenue that otherwise would not be rolling in without the online upsell chat.

"We're very thankful for that service," said Amy K. Shoaff, media director for Stanford International, a direct marketer which operates bonusamerica.com and other Web sites which retail electronics, jewelry, lotions and fitness equipment.

"We were shocked to see 30 percent conversion on the upsell. We thought we'd get 20 percent at most, so it was great," Shoaff said.

Chat veterans

It was just two years ago when executives of online marketer Bargain Network joined to form InQ as an alternative to online marketing firms offering upsell services.

"They had done a version of the online chat at Bargain, so it seemed natural to do one for InQ," Nober said.

By 2001, with about $2 million in seed money, InQ began operations with a handful of small clients and a strategy targeting the major direct marketing firms and top online retailers.

With first year sales of $1 million, the company was off to a good start despite the lack of name recognition and its unusual live chat feature that some found hard to understand.

But by the end of last year, InQ was rapidly growing, taking on a number of new clients from around the country while it went on to post just over $4 million in total revenue.

Among the company's clients are Publishers' Clearinghouse, Reunion.com, GuthyRenker Inc., movietickets.com, Supershuttle International, Winsor Pilates, and scores of others.

"People are starting to realize that we have a great service that can help them improve revenue," Nober said.

Brad Briz, chief technical officer for Woodland Hills-based marketing and advertising firm Glyphix Studio, said he's not surprised by InQ's success.

"The one thing that everyone forgot in the dot-com boom was that people still want a human element when they go online," he said. "When you have a person that you can interact with, it shows people that there's an interest in who they are and what they want."

Personal touch

Likewise Keith Cohn, president and CEO of Vendare Group, an online advertising and marketing firm in Sherman Oaks, said he believes InQ has touched a key nerve in consumer psychology.

"People like to interact--even if it's by typing--and they enjoy the personal touch of that service," he said.

While InQ continues to attract new customers, it has yet to sign a major retailer for its e-commerce site. But Nober assured that a deal could soon remedy that.

In the meantime, the company is looking to improve its chat software and make it more user friendly. Already, it is moving to license out the software to companies seeking to improve their upsell efforts.

But most companies, Nober says, are interested in outsourcing those efforts.

"We're at the point now where a lot of people know about us and it's becoming easier to sell them," he said.

With the company surpassing last year's revenue totals, InQ is poised for another good year, with sales surpassing $5 million and Nober projecting sales of $12 million next year.