What is the Key Differentiator of Conversational AI?

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How is conversational AI different from basic bots?

The key differentiator of conversational AI from traditional chatbots is the use of NLU (Natural Language Understanding) and other humanlike behaviors to enable natural conversations. This can be through text, voice, touch, or gesture input because, unlike traditional bots, conversational AI is omnichannel.

However, conversational AI isn’t as simplistic as that.

There are other features that make conversational AI applications not only different, but also superior to basic chatbots and other traditional automated customer interaction tools.

Curious to know what these features are?

In this article, we’ll take a deeper look at conversational AI by understanding how it works and why it’s perfect for customer service. We’ll also tell you how to pick the right Conversational AI solution.

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Conversational AI: A Deeper Look

Conversational AI is taking over the world, transforming digital customer service by generating custom and humanlike responses.

We use some of these tools on a regular basis, including virtual assistants like Amazon Alexa, Google Assistant, and Google Home, as well as AI chatbots like Facebook Messenger, Whatsapp chatbot, etc.

But what exactly is conversational AI?

Here’s a deeper look at conversational AI technology:

  1. How Does Conversational AI Work?

    Conversational AI uses a set of technologies to help bots manage customer interaction in a humanlike manner.

    It does so by recognizing aspects such as:

    • Text and speech
    • Context
    • Different languages

    Moreover, instead of being linear, conversational AI learns from each customer interaction and can optimize its replies over time. This means conversational interfaces keep evolving to produce a rich and helpful user experience.

    Let’s break down how it works into easy steps to better understand the process:

    Step 1: Receiving Input

    First, conversational Artificial Intelligence lets a customer enter information via text or voice.

    Step 2: Analyzing Received Input

    Conversational Artificial Intelligence employs Natural Language Processing (NLP) or Automatic Speech Recognition (ASR) depending on the type of information a customer provides. It does so to understand the meaning and intent of the words and sentences.

    Step 3: Generating a Response

    After employing NLP (which involves Natural Language Understanding) or Automatic Speech Recognition to understand the customer intent, conversational AI creates a response to it (Natural Language Generation or NLG).

    Step 4: Reinforcement or Machine Learning

    Once the response for the customer is produced using NLG, conversational AI stores the customer input received. Then it analyzes it using machine learning to ensure the replies align with the customer query’s theme.

    It also analyzes the customer intent to make the responses better and more accurate over time.

  2. Why is Conversational AI Ideal for Customer Engagement and Service?

    Here are the top reasons why conversational AI is great for customer service and customer engagement:

    1. 24/7 Availability

      The most important advantage of using a conversational AI solution for customer engagement and service is being able to provide instant customer support, in real-time, without the help of a human agent.

      Answering customer queries within an hour or quicker boosts your conversion, customer experience, and customer retention chances.

    2. Customers Prefer AI-powered Messaging

      Most businesses today are either using or considering an AI chatbot.


      Because many customers look for speedy resolutions, something that traditional chatbots can’t provide.

      Additionally, businesses are growing to understand that a large section of customers like messaging over phone calls. So offering a robust AI chatbot on your website or app will boost customer satisfaction.

    3. Highly Scalable

      Conversational AI and AI chatbot solutions can manage a large number of customer queries without depending on a human agent or agents.

      If your business unexpectedly experiences a hike in customer queries, AI Chatbots can effectively handle them throughout the customer journey - enhancing customer experience and increasing customer retention.

    4. Supports Multiple Languages

      Conversational AI can interact in the language preferred by a customer, ensuring maximum customer satisfaction and a great customer experience. As a result, you won’t need to hire a large team of human agents that speak different languages across the regions they serve.

    5. Enables Conversational Commerce

      Conversational commerce, also known as chat commerce or conversational marketing, is where online retailers use the power of conversation to sell their services and products.

      The conversational experience for such conversational commerce can be delivered by a conversational AI tool, automating marketing and sales.

      For example, conversational AI solutions like iovox Insights can draw data and intelligence from transcribed recorded conversations without human agent interference.

      You can then use the transcriptions to understand which services or products are most in-demand or discussed to increase your sales and marketing.

      You can even specifically track calls that mention your product or service using the keyword spotter feature.

  3. How to Pick the Right Conversational AI Solution?

    You have to choose the right conversational AI platform to make the most of Artificial Intelligence technologies.

    Here are some of the things to consider to choose the right conversational AI platform:

    1. Evaluate Your Business

      First, evaluate your current processes, products, services, and customer journey, and check how the capabilities of the conversational AI applications can be applied to them.

      This should help you identify processes that can use automation to save time and the efforts of human agents. The automation of time-consuming tasks can create free time for your human agents to focus on other important responsibilities.

      Finally, identify the underlying tasks for each process and decide what the addition of conversational Artificial Intelligence can do for them.

      The complete business evaluation should help you:

      • Understand all the ways such artificial solutions can help your company
      • Consider which areas of Artificial Intelligence best fit into your organization
    2. Choose a Type of Conversational AI

      Examine your customer demographics and business requirements to understand if you require chat, voice, or any other kind of customer support medium. That’ll help you pick the right type of conversational AI to employ.

      Here are the main conversational AI types:

      • AI Chatbot: This kind of chatbot is a software program that supports a digitized interaction with a human customer via text messaging. AI bots can be used in your contact center, financial institution, healthcare institution, customer service, or any other business or department you run.

        Some AI chatbot examples include Facebook Messenger, WhatsApp chatbot, etc.

      • Voice Assistant: This type of virtual assistant uses technologies to convert voice inputs into machine-readable text to understand a customer’s intent and generate a suitable response. A voice assistant offers several benefits like hands-free interaction, automatic sorting of the most popular solutions to a given query, and multiple language support.

        Amazon Alexa and Google Home are some of the most popular voice assistants.

      • Mobile Assistant: A mobile AI assistant (virtual assistant) operates in a manner similar to a voice assistant, except it’s specifically on a mobile device.

        Some examples of mobile virtual assistants include mobile apps like Siri, Google Now, Cortana, etc.

    3. Decide the Type of Deployment

      Depending on the nature of your business, you can choose how to deploy Conversational AI solutions. It can be:

      1. On-premise Deployment

        With on-premise deployment, resources are sorted on your own servers (in-house). You’re solely responsible for maintaining the solution and its processes.

        Here are the advantages of on-premise deployment:

        • Gives you proper control over security measures. You can allow access or restrict anyone from going through your data.
        • Offers customization and lets you integrate the AI solution into existing workflows.
        • Lets your enterprise use proprietary architecture and maintain its own data centers.
      2. Cloud Deployment

        Cloud deploying is when you employ third-party servers to host your data that you can access remotely from any location at any time.

        Here are some of its advantages:

        • Relatively less expensive than on-premise deployment.
        • You don’t need to maintain servers in-house.
        • Offers your enterprise continual AI solution upgrades.
        • Provides access to pre-built machine learning APIs.
      3. Hybrid Deployment

        In a hybrid deployment, you get the benefits of cloud deploying while you’re connected to your in-house systems.

        • Production infrastructure is on-premise, whereas processes like conversational AI training and analytics are executed in the cloud.
        • Allows seamless movement of apps between on and off-premises infrastructure.
    4. Look for Industry Expertise

      Different industries have different needs and use cases.

      Datasets for e-commerce are entirely different from travel, which again is nothing like datasets for financial services or real estate.

      That’s why a vendor for a conversational AI solution that has several clients from just one industry (different from yours) may not be able to support your business and your expectations.

      You need to look for varied industry expertise and to get a better idea of the industry datasets from your conversational AI solution vendor.

      To do so, consider asking them the following questions:

      • How many clients does the conversational AI solution support in your industry?
      • What’s the projection accuracy for queries in your industry?
      • Do the clients handle the same volume of customer support queries as your business?

      Answers to these questions will give you an idea of how well the conversational AI platform will perform for your business - helping you consider or reject the solution.

    5. Match Your Needs

      You should pick a conversational AI platform that matches your needs.

      So it’s important to get in touch with the right conversational AI provider who can determine the scope of your business and offer an AI solution with features fitting your needs.

      Speaking of meeting your needs, if you’re part of a business that needs to handle phone calls regularly or you run a contact center, try out iovox Insights.

      What’s that?

      iovox Insights is the most efficient conversational AI solution that lets you:

      • Record and search human conversations
      • Transcribe recorded conversations to draw insights, spot trends, and predict outcomes
      • Track customer interaction calls with specific keywords or phrases
      • Train your Artificial Intelligence with advanced criteria such as adding a trigger or filter.
      • And more!

Wrapping Up

The key differentiator of conversational AI is Natural Language Understanding (a component of Natural Language Processing).

It makes human interaction possible with bots in a humanlike manner which can help you automate customer-facing touchpoints - turning AI solutions into an essential component of the age of digital transformation.

With conversational AI applications and their abilities, your business will save time and money, while improving customer retention, user experience, and customer satisfaction.

Moreover, the surge in the number of conversational AI solutions today makes it easy to find your perfect fit for a digital transformation of customer support.

So why wait?

Start using iovox Insights to benefit from conversational AI today!

At iovox, we make it easy to experiment and we’d love to learn more about your business and how we can help. To connect with us, click the call button below and our team will be in touch with you shortly.

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