Conversational AI is one of the hottest tech trends that's completely reshaping how we interact with computers and machines.
In this article, we'll explore what conversational AI is, how it works, the business value it offers, and whether your customers actually want to chat with robots (hint: they do!).
We’ll cover:
- What’s conversational AI?
- Use-cases and applications
- How does it work?
- Why does your business need conversational AI in 2024?
- What business value does it bring?
- Do your customers want to interact with AI?
- How do you create a conversational AI?
Let’s get started!
What's conversational AI?
Conversational AI refers to technology that allows people to interact with AI systems using natural language.
The two most common examples? Advanced chatbots and voice assistants.
Chatbots are software programs that can have text conversations, like ChatGPT or Claude, while voice assistants like Siri or Alexa let you speak with an AI.
These systems are powered by natural language processing, which allows them to understand human language. They can analyze what a person says or types and determine the intent and meaning so they can respond just like a person would.
Note: Not all chatbots have these capabilities, which is why we made a distinction between the advanced kind. Most chatbots on business pages and sales websites have simple, pre-baked responses, and are not really AI per se.
Use cases and applications of conversational AI
Conversational AI has a wide range of use cases that can be very helpful for both businesses and customers:
- Customer service. One of the most popular uses of conversational AI is for automated customer service. Today, chatbots equipped with conversational AI can handle anything from basic queries to complex cases, providing quick responses and solutions. This leaves human agents valuable time to devote themselves to escalation or tough nuts to crack.
- Personal assistants. Many companies use conversational AI to power virtual assistants that can schedule meetings, set reminders, play music, answer questions, and much more. These assistants are designed to complete tasks through voice commands or text.
- E-commerce. In e-commerce, conversational AI is used to help shoppers find products, get recommendations, and complete purchases. AI-powered chatbots can guide customers through the buying journey, providing a personalized experience.
- Lead generation and marketing. Chatbots are also used for lead generation and marketing. They can start conversations, ask qualifying questions, and collect contact information from people interested in a company's products or services. These actionable insights are collected and then passed to sales teams.
Of course, this is just scratching the surface, the very tip of the AI iceberg. Today, if you name it, there’s very likely an AI tool that can do it. If not, then that tool is probably in the works.
How does conversational AI work?
So far, all this natural language stuff may sound like gibberish to you. Let’s go into a bit more detail to clear things up:
Natural language processing
Conversational AI can understand what you say thanks to natural language processing (NLP).
NLP allows the bot or virtual assistant to break down your message into bits of data it can interpret. It identifies the intent behind your words and any entities like dates, times, or locations. It then determines the best response based on its programming.
Machine learning
Conversational AI gets smarter over time through machine learning. As people interact with the AI, it collects data to better understand language and improve its responses. Machine learning algorithms also allow chatbots to detect patterns and learn from experience. The more people engage with it, the more it learns and the better it can serve customers.
Supervised learning and unsupervised learning
Some conversational AI tools have a supervised approach, where human experts label data to help the AI interpret it.
Others use unsupervised learning, where the AI finds patterns on its own by analyzing raw data. Many AIs use a combination of these machine-learning techniques.
Why does your business need conversational AI in 2024?
There are quite a few reasons we can name off the top of our heads, and you’re going to need to give each of them careful consideration.
Let’s take a look:
Keep up with growing customer expectations
In just a few short years, conversational AI has gone from a novelty to an expectation.
In 2024, having an automated method for customers to get information and resolve basic issues is a top priority for most companies.
If your business doesn’t provide this type of streamlined, 24/7 self-service option, customers may get frustrated and walk out the (virtual) door.
Gain valuable customer insights
Conversational AI can help your team gain invaluable insights from the types of questions and concerns your AI is fielding.
This can help identify opportunities to improve products, address recurring problems, and better serve customer needs.
Reduce costs while improving CX
Using a conversational AI for customer service doesn’t mean eliminating human support. However, it can significantly decrease costs by reducing the volume of basic questions and requests that support staff have to handle manually.
At the same time, a well-designed AI system improves the overall customer experience by providing quick, convenient, and consistent responses and resolutions at any time of day or night.
Future-proof your business
Adopting innovative solutions today will help future-proof your company for the digital-first world of… well, today, really.
While conversational AI may seem cutting-edge now, in a few short years, it will be an integral part of customer engagement across industries. The time to start planning was yesterday.
But, barring access to a time-traveling DeLorean, the time is today.
What business value does conversational AI bring?
Conversational AI can provide unbelievable value to businesses in numerous ways.
Let’s take a look at how that’s possible:
- Why wait to say “Hi”? Instead of customers always initiating contact, AI can reach out with relevant offers, reminders, or troubleshoot issues even before they arise. This anticipates customer needs, making things feel effortless.
- Using internal knowledge to the max: Conversational AI can be trained on a company's internal knowledge base. This lets employees quickly find policies, procedures, or best practices without sifting through documents or asking around.
- Bye-bye language barrier: Advanced AI can handle multilingual conversations with real-time translation. This breaks down communication obstacles and makes businesses accessible on a global scale.
- So much data: Every conversation with conversational AI provides valuable data about customer needs, preferences, and pain points. This data can uncover insights to improve products and services. It also helps in lead generation and sales.
- This time, it’s personal: Conversational AI uses customer data to provide personalized experiences. Chatbots can recognize individuals and tailor responses based on past interactions and preferences. This type of personalization creates a better customer experience and builds brand loyalty.
Do your customers want to interact with conversational AI?
Increasingly, customers are open and even prefer interacting with conversational AI for certain tasks. A recent Zendesk study found that 69% of customers are willing to interact with a bot for simple issues — a 23% increase from the previous year.
Here's why:
- It’s faster: Customers want their issues resolved quickly and don't want to wait on hold or navigate complex phone menus. Chatbots offer 24/7 assistance and immediate responses for simple queries.
- Doing it yourself feels good: Many people enjoy the independence of finding answers or completing tasks themselves, especially for basic transactions. Conversational AI empowers them to do this on their own time.
- Improved experiences: Modern conversational AI is a far cry from the frustrating chatbots of the past. AI platforms are becoming more sophisticated, understanding natural language and providing personalized interactions.
- More accessible: Conversational AI can break down language barriers, helping customers who may not be fluent in the company's primary language.
- Consistency: AI-powered interactions ensure every customer receives the same standard of service, regardless of the time of day or which human agent they might have interacted with previously.
- Reduced pressure: For some customers, interacting with an AI can feel less intimidating than speaking to a live person, especially for potentially sensitive or straightforward questions.
How do you create conversational AI?
With Lindy, it’s easy. It takes only a few minutes and doesn’t require any coding experience.
Here’s how:
Step 1: Task and Instructions
- Start by pinpointing the exact job you want your conversational AI to do (scheduling meetings, answering customer questions, etc.).
- Give Lindy clear guidelines with plenty of examples. The more detail, the better it'll understand what you need.
Step 2: Integrate
- Lindy has over 3,000 integrations with popular tools like Google Calendar, Slack, and more.
- Connect the relevant ones to expand your AI’s capabilities across platforms.
Step 3: Test, Feedback, Improve
- Put your Lindy to the test! See how it performs on your given tasks.
- Give specific feedback on what worked well and what needs tweaking. This is how your conversational AI learns and gets better over time.
Frequently asked questions
How do I build a conversational AI system?
The first step is to determine the goals and use cases for your conversational AI. Do you want to handle customer service queries, provide an automated assistant, or something else?
Next, choose a platform to build your chatbot on, like Lindy, Amazon Lex, Google Dialogflow, or Anthropic. You'll need to design the conversation flow, responses, and machine learning models to power your chatbot. Testing and continuous improvement are key to launching a successful conversational AI.
How much does it cost to develop a chatbot?
The cost to develop a conversational AI system depends on the complexity and scope of your needs. Since we’re not talking about developing them from scratch, AI assistants like Lindy can let you create your own conversational AI in 30 seconds, try Lindy for free.
How do customers interact with a chatbot?
Customers can interact with a conversational AI in a few ways.
The most common methods are:
- Text-based chat: Customers type or text questions and comments to communicate with the AI.
- Voice-based chat: Customers speak naturally to the AI and get verbal responses. Voice assistants like Lindy, Alexa, and Siri use voice-based chat.
- Embedded chat: Conversational AIs embedded into mobile apps, websites, SMS, and messaging apps like Facebook Messenger to communicate with customers.
- Multichannel: AIs are deployed across multiple channels, so customers can interact through text chat, voice, mobile apps, websites, and more.
Does my business need conversational AI?
Many companies are finding success using conversational AI to improve customer experience, reduce costs, and streamline processes. Chatbots can easily take on common customer queries — which frees up human brainpower for the more complex stuff. They provide an automated yet personalized experience that many customers prefer. If you want to offer innovative service or stay ahead of trends, conversational AI may be right for your business.
How does conversational AI actually work?
Conversational AI uses a few key technologies in tandem. Natural language processing (NLP) helps it understand what you're saying, even if you don't phrase things perfectly. Machine learning allows the AI to get better over time, learning from past conversations to improve its responses. Think of it like a super-smart chatbot that can handle more complex questions and provide more personalized assistance.
Do all chatbots have conversational AI?
Regular chatbots often work with a set of pre-programmed rules and responses. They're good at handling basic tasks but can get stuck with anything outside their narrow set of instructions. Conversational AI is much more flexible. It can understand the nuances of language, learn from interactions, and even generate its own responses in a way that feels more natural — kind of like talking to a real person.
Summing up
Conversational AI is shaping up to be the next big thing for businesses in 2024 and beyond.
Overall, it seems that companies can boost customer satisfaction, reduce costs, and scale operations by implementing advanced chatbots and virtual assistants powered by AI.
The key, then, is just finding the right conversational AI for your business — one that ticks all of your boxes and has a proven track record of success!
Next steps
Lindy goes above and beyond the typical bot. Its conversational AI is built to be flexible and adaptable, blending chatbot efficiency with advanced understanding.
Plus, Lindy offers a revolutionary feature. Instances of Lindy (Lindies) can communicate with one another to glean insights, share data, and complete different tasks. When pooled together, they can work exponentially faster.
Here's how Lindy goes the extra mile:
- Handles customer questions in your inbox: Lindy tackles inquiries within your support channels or its own email, leading to faster resolutions and happier customers.
- Provides support around the clock: Customers won't be left waiting — Lindy offers help any time of day or night.
- Breaks down language barriers: Lindy can chat in over 13 languages, expanding your potential customer base.
- Integrates easily with your website: Add Lindy to your site using a simple code snippet for improved visitor engagement.
- Connects seamlessly with your tools: Lindy works with over 3,000 tools (like Stripe and Intercom) for streamlined workflows.
- Scales to meet demand: Lindy handles any volume of requests and even collaborates with other Lindy instances to tackle complex tasks.
