It's probably not what you think..
Primarily, let me thank you for taking the time to learn about us, we are honored that you’re considering tawk.to.
I’m Robert, tawk.to’s founder, I’ll help to clarify the following:
- “How does tawk.to generate revenue?” – (with a short backstory for good measure!)
- How we have managed to remain free, and scale to millions of users servicing billions of end consumers.
- Who we are, and what our aspirations are for the future.
- Our mission and purpose, and explain how truly important you are in helping us to meet them both.
- and I’ll provide my details should you have further questions.
So, why offer a free product?
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When we first launched in October of 2013, tawk.to would most certainly have been considered a late entrant.
The incumbents that came before us paved the way – though that didn’t scare us, as what was available in the market, simply didn’t fit our use-case, and more importantly, truly didn’t solve the problem(s) that businesses were actually facing.
We started this journey as unsatisfied live chat software customers subscribed to vendors that wouldn’t listen to our feedback.
“Never under estimate a late entrant - they get to start by learning from all of your mistakes.”
At the time, we figured that there were other companies out there that felt the same way we did :
- that the SaaS pricing our competitors charged wasn’t attractive for many use-cases.
- that the reliability and accountability of vendors just wasn’t up to par for a tool as important as communicating with customers.
- that there were so many beneficial features missing, as competitor apps were built around revenue models of “charging per seat”, as opposed to an agent-centric model like tawk.to, which made more sense to us.
- that there were no multi-tenant chat applications in the market, that offered the ability to manage multiple separate customer bases with one login.
- that the cost of paying for the software itself is not the biggest barrier for businesses to offer live chat as a channel, but instead it is the cost of staffing to answer chats 24×7 that is so prohibitive.
- that just because there are hundreds of known competitors, it didn’t mean we had to target their customers to gain market share, we could enter and help to grow the size of the pie, not the size of our slice.
- that it was bizarre that when we visited the websites of many competitors , they were and still are – almost always offline. If you’re going to offer live chat as your core product, and not use it yourself, there’s clearly a problem.
"Don’t fool yourself into thinking your competitors know more than you do, opinions and ideas are like elbows - everyone has two. Do your research to gain some insight, back it up with your gut feel.. and most of all, be prepared to be patient.. very.. patient. It takes a least a decade to build an ‘overnight’ success."
According to Datanyze and BuiltWith, (the independent entities that track market share in the Live Chat market), there are currently 206 live chat competitors.
So how could we enter (late) in a market that is so crowded, and still compete?
Especially when :
- We weren’t the first to market.
- We’re not VC funded.
- We’re not based in Silicon Valley.
- Our founder didn’t go to Stanford or Harvard.
- Our competitors are multi-billion $, publicly traded companies.
Quite simple:
"If you want to be an anomaly , then you best start acting like an anomaly"
As per the table above, tawk.to is now the #1 most widely used live chat application in the world, we’ve captured 20+% of the market, we’re the fastest growing company in the space and 1.7+ Billion people interact with a tawk.to widget each and every month — that’s 1 in every 3 people online.
Considering we have never done a single press interview, never published a press release, spend almost nothing on advertising and never speak at public events or conferences.. that’s not too bad, right?
So how did we achieve that you ask?
"If you’re focused on your competitors, then you’re not focused on your customer - commit to getting as close as possible to your customer, truly fall in love with the problem you solve for them, and you can’t lose."
Very simple :
We made you, our customer, our partner – and we made it our mission and our purpose to bring you closer to your customers – to help you grow your business, and evolve with you on your entrepreneurial journey.
The thing is.. you made us who and what we are.
Your feedback, your ideas, your input, your patience and your loyalty — tawk.to has been molded and shaped, into what you wanted it to be. You are our maker.
When your customers message you, you are tawk.to.
And to tawk.to, you are everything.
As a result, millions of forward-thinking business users now use tawk.to to get closer to their customers.
There was no way we were going to enter an incredibly competitive and crowded space, and just try and build a better mousetrap. That’s entrepreneurial suicide.
So we ignored our competitors, and focused on our customers – a strategy many would consider as ‘putting the blinders on’ – we call it the secret to our success.
And believe me when I tell you, I know that sounds like hyperbole, though when simple things like just being available to help customers get the widget installed, became a massive differentiator we knew we were on to something.
As a result tawk.to offers 24×7–365 live support. We never close, you can always reach us.
Revenue by proximity to your customers, how does that work exactly?
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Let me explain:
Just being free was never going to be enough – tawk.to had to be the best.
When first planning out our model, we figured that :
- we wanted to build an agent centric model, so that an agent could share properties with different colleagues without having to have two completely separate accounts. Something nobody else does.
- we wanted to build team collaboration (think slack + zendesk) all in one dashboard, by offering Direct Messaging, Groups/Channels & chat all in one.
- we wanted everyone to use our software without having to fork over silly amounts of $ i.e. truly free.
- our support had to be available 24×7–365, with a commitment towards absolutely delighting our users. Check out our customer stories.
- we wanted to only ever monetize at the junction where our customers derive value and benefit, not just by limiting access to certain features or putting time limits on products.
"A customer will pay for a feature for a month, they’ll pay for benefits for a lifetime."
So, how does tawk.to actually generate revenue?
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So now you’re asking yourself.. how do we manage to ship a feature packed product – in 27 different languages, to billions of consumers whilst providing 24×7–365 live support to millions of business users completely for free, and still manage to keep our lights on?
- If you would like to remove the tiny “Powered by tawk.to” branding from our products, we charge $19/month. Don’t remove it, and it is free for life.
- If you don’t want to have to sit and answer chats all day, we will do it for you for $1/hour. Yes, you read that right – $1/hr for professionally trained, incredibly talented, native speaking live agents, whom are thoroughly trained to answer chats on behalf of your business 24×7–365.
Now.. there are probably three things you’re thinking :
How can a 3rd party agent answer on behalf of my business?
They don’t know my business. It would take forever for them to learn everything.
That is a very common misconception. Let’s do a quick exercise to illustrate:
If I asked you:
How tall is the empire state building in New York?
You most probably can’t answer that question from memory. Though in about 5 seconds, you could provide me with a very accurate answer via Google.
See what you did there?
An agent doesn’t need to remember every possible answer, they just need to know where to find the answer.
See, by the sheer nature of our business we simply had to invest heavily in building a chat system that focuses on the Agent Experience – as our entire business depends on our agents answering on behalf of hundreds of different customer use-cases, from all over the world 24×7–365.
Which is why we truly believe, we have one of the best business messaging applications anywhere. In software development terms, that is called “eating your own dog food”.
By answering on behalf of different customers, of all shapes and sizes, we gain access and dive deep on many different use-cases that we really wouldn’t otherwise get exposure to. This has helped us to constantly iterate the software so that all of our free users benefit also. Which mind you, is 99% of all of our users.
We don’t sell chat software, we give the best, and most tried and tested software in a ‘real-world’, massive scale environment away completely free of charge.
Everybody wins.
The next question/comment/remark you may have is:
How can you scale a Hired-Agent service for $1/hr? That isn’t a scalable model.
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Actually, it is. You just can’t see it – and that’s the magic.
The most attractive businesses in the world, are the businesses that nobody else deems attractive. That’s what gets us excited.
Many SaaS providers attempt to build ‘hands off’, scalable software – and then they all inevitably focus on “Churn” ( the term the SaaS world uses to describe the difference between the % of users signing up to your service, versus leaving your service )
They then compete on features, and compete on price, to a race to the bottom.
We compete on value. And only on value.
We also believe that many business owners don’t actually want live chat software. What they actually want is more leads, more sales and to ensure their customers have a great CX. We know that statement is an incredibly bizzare thing to say, from the producer of the world’s most widely used chat application.
Though that is the truth.
The world has changed, and consumer expectations have changed with it. We all expect businesses to respond to us as quickly as our friends and family do, and to be where we are, which is in messaging.
Most business owners simply don’t have the bandwidth to sit there answering chats all day, so for those that do; we offer completely free chat software. And for those that don’t, we solve that problem for $1/hr.
Compare the following :
Model 1 - The traditional SaaS model
A subscription driven traditional Live Chat SaaS company that sells software for $40/seat/month. They sell you a subscription to the software, and compete with other SaaS companies on features. The more often they communicate with you, and provide you support, the lower their margins.
If they manage to sell you 1 seat, and keep you subscribed for 12 months, the LVC (Lifetime Value of a Customer) is $480. So they can’t afford to spend too much time with you over a 12 month period, or their model is unprofitable.
You then need to staff the chat, which if you intend to run 24×7 and you pay say $15/hr for a decent agent, it is going to cost you : $131,400/year just to have 1 agent available.
Model 2 - The tawk.to model
A value-driven model like tawk.to where we give you our software away for free, and as a result have obtained mass adoption. Should you decide to subscribe to our hired chat agent service (_zero pressure_ to do so), then we will train an agent for you on your business, and it will cost $1/hr.
So.. do you want to spend $131,400/year or $8736/year?
And do you want to deal with a software provider that loses money if they speak to you too often, or do you want to deal with tawk.to where delivering world-class customer support is the core of our business?
You're now #1, where to from here? What's the mission?
Every living organism on this planet exists to be in service to something else.
The sun gives light and heat. The bees pollinate flowers and give us honey. Some animals give their life so others can thrive. Our purpose here, just like every other living thing in this crazy world that we all coexist in, is to simply give as much as we can. Whether that be tools, jobs, time, money, care, opportunity, empathy, compassion, advice or forgiveness.
Our mission at tawk.to is simply to give:
Equal Access to Opportunity
> All businesses, regardless of size or location, should have access to the best tools to communicate and transact with their customers, and we solely monetize at the junction where our customers derive value and benefit, not just by giving or limiting access to certain features.
Ultimately, we believe that you should never have to pay to communicate with your customers, they are your customers – and if you’re using tawk.to; you never will.
As a result we have now launched and are working on the following products and services:
- Live Chat (what we became famous for)
- Chat Pages – Turn links in to conversations, perfect for businesses that don’t have a website.
- Knowledge Base – a completely free hosted help center, so that customers can find answers themselves.
- Ticketing – Free smart ticketing software that gives you the context you need to help solve customer problems within the first response.
- In-Chat Payments (Alpha out now) – Transact with your customers directly in the chat widget.
- CRM (Beta, out soon!) – Manage all your contacts and events across all channels, get a full view of the customer journey from top down.
- Messaging (Beta, out soon!) – Truly be where your customers are with integrations with Facebook, Google RCS, Telegram, SMS and social. Respond from one dashboard, across all asynchronous messaging channels.
- Phone (Beta soon!) – Make voice calls and SMS directly within the dashboard.
- Hire Chat Agents – Many businesses simply don’t have the time or manpower to sit there answering chats all day. So for just $1 per hour we train chat agents for you, and answer on behalf of your business.
- Virtual Assistants – For clients that require dedicated resources, we now offer dedicated virtual assistants from just $7/hr. From designers, to admin, hr, book keeping and data entry – Free up your time, get organized, and simplify your work day.
In summary:
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That was a long read, but hopefully you now know us a little better.
Now, if you are thinking of building your own company, even in the live chat space, and you think that you can do a better job than what is available in the market, and have an idea of how to differentiate your service offering to gain (or grow) market share; then we say go for it!
Don’t listen to the naysayers, they don’t know any more than you do – and often less.
As one of our startup hero’s once said :
“The media wants overnight successes (so they have someone to tear down). Ignore them. Ignore the early adopter critics that never have enough to play with. Ignore your investors that want proven tactics and predictable instant results. Listen instead to your real customers, to your vision and make something for the long haul. Because that's how long it's going to take.”
>
> Seth Godin, entrepreneur.
I’ll go as far as to say that I’m available to give you some advice on how to go about it, this pie is big enough for everyone to eat – connect with me, I’d be most happy to have a chat with you. Don’t let competitors in a market place scare you. I’m an open book, we can all share ideas – and I may learn something from you.
Many entrepreneurs fear that a crowded market place means there is no room for new entrants and that unscalable business models aren’t worth pursuing; though tawk.to has proven the opposite to be true.
If everyone else is telling you your idea will not work, it isn’t scalable, or the model simply isn’t sexy. Ignore them. With careful planning; a solid strategy for growth and a tight USP you can compete as well as anyone else – regardless of when you decide to enter.
You need only look as far as Nokia? Kodak? Blackberry? and Yahoo? to recognize that just because a brand was market leader at one point in time, it doesn’t mean 2 girls/guys in a garage can’t build, launch & compete.
People Prefer to Message
Your customers have spoken loud and clear, messaging is their channel of choice – and you need to be where your customers are, when they need you the most.
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