"The pandemic has forced companies to seek out automation," LivePerson Israel GM on the Benefits of Working with Bots

Conversational Cloud company sees 18% bump in revenue as Covid-19 forces call centers to go automated, stock soars on Nasdaq and in Tel Aviv

Allon Sinai 09:1906.05.20

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If anyone had any doubt about the future of customer service, the coronavirus (Covid-19) crisis likely changed that. The days in which a phone conversation with a human was the primary way for companies to engage with their clients were gone even prior to the pandemic. But it is now more obvious than ever that they are quickly becoming obsolete, with automatization becoming the name of the game.

When it comes to innovating conversational connections between brands and consumers, LivePerson Inc., with its 1,300 employees worldwide, 350 of them in Israel, is among the world leaders. LivePerson's Conversational Cloud allows brands to engage consumers on the world's most popular messaging channels, using prebuilt templates and tools to design automated, personalized conversations.

LivePerson general manager Yuval Matalon. Photo: Inbal Marmari

Unlike most businesses that suffered a blow, big or small, due to the unfolding economic crisis, the pandemic presents LivePerson with immense opportunity. "The pandemic has been good for us as we are a digital platform with messaging and bots that enables automatization," explained Yuval Matalon, Israel general manager at the Nasdaq and Tel Aviv-listed company when talking to CTech earlier this week. "All of these things received a stamp of approval of sorts because of the pandemic as our customers have come to lean on our products almost exclusively as a solution to be able to continue and serve their clients. Technologically, we faced the challenge of scaling traffic at amounts we had never previously encountered and doing it quickly, but from a business standpoint this certainly presented an opportunity for us."

LivePerson announced on Tuesday its financial results for the first quarter of 2020, with total revenue hitting $78.1 million, an increase of 18% as compared to the same period last year. "LivePerson signed 130 deals in the first quarter, an increase of 10% year over year, including the addition of 56 new and 74 existing customer contracts," read the company's report. LivePerson's stock soared 11.8% on Nasdaq on Tuesday and at the time of writing is up over 20% on the Tel Aviv Stock Exchange. It had lost almost two thirds of its value between February 12 and March 18.

Matalon, who joined LivePerson in 2018 after 10 years at eBay, said that many of the company's existing clients found themselves in dire straits when they were forced to shut down their call centers. "Our customers are active in very critical verticals like telecom, financial institutions, and air travel, and their entire customer service departments were based on telephony. I think that early in the crisis they maybe didn't understand the direction in which things were heading, but soon enough most countries began to force businesses to start working from home and overnight companies that used our platforms together with a phone service came to us asking to replace it completely," Matalon said. “For example, a big client may have been previously using our platform for 20 percent of his workload, but then overnight he came and asked to increase that fivefold because he had no other choice. He was forced to send all his employees to work from home and needed to adopt a completely digital model."

Matalon said the traffic on the company's platform doubled, which while presenting business opportunities did also result in scaling challenges. "Even though the whole world is experiencing a financial crisis, because of the solutions our product offers, the pandemic has only hurt us very slightly and for the most part presented us with more opportunities," he explained. "What we are mainly seeing is existing customers increasing their usage rather than new customers joining. Bringing in new clients and signing new big deals is a little more challenging these days, although we are getting that done as well."

According to the company, during the first quarter of 2020, LivePerson signed contracts with a top 50 U.S. bank, a Fortune 500 health insurance provider, one of Europe's leading banks with millions of consumers, and a top 20 global telecommunications provider. It also expanded business with a top 20 multinational commercial bank, a top-five global apparel retailer, and one of the five largest life insurance companies. Its 18,000 customers in total also include the likes of HSBC, Orange, GM Financial, and The Home Depot.

"The COVID crisis was a wake-up call that the legacy call center model is a relic and incapable of supporting a remote home-based workforce," said LivePerson CEO and founder, Rob LoCascio. "Whereas the corporate world turned to video conferencing applications to support office workers, LiveEngage is filling the void for the contact center. We are seeing Conversational Commerce adoption trends accelerate with many of our customers, and a new normal is emerging where brands are leading with AI-powered messaging built and managed by work from home agents."

Matalon, speaking before the release of the results, echoed a similar sentiment. "I think this was a wake-up call for many executives that the best course of action is to lean on digital platforms that allow for remote work," he added. "Companies aren't going to go back to the way things were previously. That is pretty clear, if only due to the forecasts that there could be more coronavirus waves coming. Therefore, companies will be wary of returning to the way things once were and I think they will instead strengthen their digital routine and invest a lot more in automatization. They will understand that automatization can solve a lot of problems for them and I'm very optimistic that this will also give us a push going forward."

The restrictions enforced due to the pandemic also forced LivePerson to adjust its workflow in Israel, and the results were in many ways surprising to Matalon. "I learned that working from home not only didn't hurt the productivity of the employees but that in many cases the productivity improved, which has given me a lot to think about regarding the physical workspace and how it will look after the pandemic," he said. "We are constantly working to see how we can scale requests from our customers in a relatively short time frame. In the past, we used to create long-term plans and it would take months to increase activity. The arrival of coronavirus has taken that luxury away from us and has forced us to get the job done in much shorter timeframes. It has also forced us to think outside the box and really see how we can provide the best service possible."