Conversational AI 01
Article Ultimate Knowledge Popular 2 min read

What Is Conversational AI? A Small Explanation.

How conversational AI combines several technologies to allow humans and machines to chat.

How conversational AI works

Conversational AI is a set of technologies that allows humans and machines to have human-like interactions, mainly through voice assistants such as Siri and Alexa, and text messaging services like chatbots. Conversational AI resorts to a wide range of technologies: Automatic Speech Recognition (ASR), also known as voice recognition, which translates spoken word into a machine-readable text; Natural Language Processing (NLP) and its sub-component Natural Language Understanding (NLU), which make sense of a text and its intent; Advanced Dialogue Management, which forms the machine's response and, using Natural Language Generation (NLG, another component of NLP), converts it into a format humans can understand; finally, the answer is delivered either through text or through voice, which requires the use of text-to-speech technology. Yes, that's a lot of acronyms.

What is conversational AI good for?

Conversational AI is already mainstream: according to a May 2019 Capgemini report, 74% of consumers use conversational assistants to research or buy products and services. The technology is also largely used to book services like an Uber and perform banking operations. Overall, conversational AI revolutionises the customer service experience, making customer support faster and more effective, recommendations more accurate, and the overall relationship more tailored. And it works: Capgemini finds that 71% of consumers are happy with their smartphone voice assistants, and 62% with company websites' chat assistants. Conversational AI also enthuse companies: they massively see it as a "key enabler of the company's business and customer engagement strategy" and credit it for reducing customer service costs and improving both operations and customer experience.

An untapped potential

Still, only half of the top 100 organisations Capgemini talked to have a voice and chat assistants; the rate drops to 23% for consumer products companies. Come rain or come shine, these companies will have to catch the conversational AI train: according to Hubspot, by 2020, 85 % of the customer-company relationship will be managed with no human interaction. Might as well come up with a strategy to make human-AI interactions consistent with their brand's values right away.

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