What is Conversational AI? Business Benefits and Application Examples

What Is Conversational AI: Examples, Benefits, Use Cases

conversational ai examples

When a potential customer visits an ecommerce website, an AI chatbot can interact with them, teach them about the product or company, and provide information that can pique their interest. Conversational AI can go beyond helping resolve customer issues by selling, or upselling. Customers can search and shop for specific products, or general keywords, to receive personalized recommendations. conversational ai examples And with inventory and product shipment tracking, shoppers have visibility into what’s in stock and where their orders are. AI technology is already empowering companies to make smarter business decisions. According to The 2023 State of Media Report, 96% of business leaders agree that AI and ML can help companies significantly improve decision-making processes.

Sentiment analysis is a process in natural language processing (NLP) that involves analyzing text or speech to identify the emotions, tone, and intent behind the words. This technique allows machines to understand the nuances of human communication and respond accordingly. Conversational AI can definitely be used in a wide variety of industries, from utilities, to airlines, to construction, and so on. As long as your business needs to automate customer service, sales, or even marketing tasks, conversational AI and chatbots can be designed to answer those specific questions. More and more companies are adopting AI-powered customer service solutions to meet customer needs and reduce operational costs. Of these AI-powered solutions, chatbots and intelligent virtual assistants top the list and their adoption is expected to double in the next 2-5 years.

Benefits and challenges of conversational AI

Dialog management orchestrates the responses, and converts then into human understandable format using Natural Language Generation (NLG), which is the other part of NLP. First, the application receives the information input from the human, which can be either written text or spoken phrases. If the input is spoken, ASR, https://www.metadialog.com/ also known as voice recognition, is the technology that makes sense of the spoken words and translates then into a machine readable format, text. Conversational AI is the set of technologies behind automated messaging and speech-enabled applications that offer human-like interactions between computers and humans.


These inquiries determine the main intents and needs of your shoppers, which can then be served on autopilot. Customer feedback helps to identify what you should improve and what your shoppers’ needs are. This data can show you what device clients use to make a purchase, what age group they belong to, what products they’re interested in and much more. Whereas, saving the chat transcripts will enable you to analyze the conversations more closely. Chatbots can take care of simple issues and only involve human agents when the request is too complex for them to handle.

What is the difference between a chatbot and conversational AI?

They run the product through different scenarios to test its capabilities and evaluate how it responds to their questions and requests. If there is feedback from stakeholders (questions and variables missing), the team works on implementing stakeholders’ suggestions and polishing the product. If the product meets expectations and they’re satisfied with the results, the project is approved for deployment. The team runs several tests, evaluating the conversational assistant’s performance, how much time it needs to respond to a query or process a request, and how it reacts to various wording.

This continuity in conversations across platforms ensures better customer experiences, lower drop-offs, and higher conversion rates. If we had to put it simply, conversational AI converts human language to machine language and vice versa. This conversion helps software understand what the human is asking and perform an action based on that request.

Although conversational AI can perform a variety of functions and tasks, it’s still limited to what it was programmed to do. So, there will come a time when the website visitor will need to be redirected from the chatbot to live chat. Natural language understanding is responsible for making sense of the language data input. It brings out the context, intents, and structure of the information to determine the meaning of the input. This technology also learns through interactions to provide more relevant replies in the future.

conversational ai examples

While you can create custom AI applications for your business, choosing a pre-built AI platform is easier, faster, and ideal for beginners. Another less catastrophic–but still frustrating–Conversational AI challenge is the technology’s frequent failure to properly understand what users are saying and what they want. Because Conversational AI is informed by a much wider context than just a single interaction. When interacting with customers, AI takes into account current market trends, consumer behavioral patterns, cultural influences, geopolitical shifts, current events, and the way our language evolves. Conversational AI revolutionizes the sales process by automating outbound marketing, lead generation and lead qualification, drip marketing campaigns and follow-ups, and even customer opt-outs and DNC databases.

Conversational AI gives data-driven insights

Although you don’t necessarily need a specialised technical team, installing and configuring a conversational AI system on your communication platform can take time. Reaching maximum effectiveness also takes various amounts of time, depending on the solution chosen. However, AI solution vendors generally offer integrations that are compatible with the various business tools on the market.

  • Since conversational AI relies on machine learning and constantly bettering itself, it will let you automate highly personalized customer service resolutions.
  • At this stage, the delivery manager meets with the AI architect and business analyst to discuss the potential conversational AI product.
  • In order to achieve this, conversational AI systems must be able to understand context, remember previous interactions, and generate appropriate responses based on the current state of the conversation.
  • Language input can be a pain point for conversational AI, whether the input is text or voice.
  • Since most interactions with support are information-seeking and repetitive, businesses can program conversational AI to handle various use cases, ensuring comprehensiveness and consistency.

This is all thanks to the algorithm created and improved by Conversation Design–the workflow and architecture behind the best AI-powered conversations. Have you ever seen a mobile ad and thought “my phone is clearly reading my mind? ” That’s not telepathy, that’s algorithms determining what you want based on your past activity. For many ecommerce companies, this is one of the biggest advantages of conversational AI. Instead of going through the menu options, you could just chat with an AI that already knows your location and physician.

These are basic answer and response machines, also known as chatbots, where you must type the exact keyword required to receive the appropriate response. In fact, these chatbots are so basic that they may not even be considered Conversational AI at all, as they do not use NLP or dialog management or machine learning to improve over time. It processes unstructured data and translates it into information that machines can understand and produce an appropriate response to. NLP consists of two crucial parts—natural language understanding and natural language generation. NLP is a fundamental component of conversational intelligence because it enables machines to comprehend the meaning and context of human input.

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Thanks to ML technology, businesses now have access to invaluable feedback that would otherwise only be available by speaking directly with a human representative. Virtual assistants are some of the common applications of conversational AI, but the technology can offer so much more for you and your business. Virtual assistants such as Siri, Alexa, or Cortana include a vital component that helps people – machine learning.

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