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Conversational AI: From Chatbots to Intelligent Virtual Assistants

How changes in customer expectations and more accessible AI technologies are changing what it means to be a chatbot.

Over the last decade, Conversational AI applications like chatbots and Intelligent Virtual Assistants (IVAs)  have become fixtures in the digital customer experience. The earliest chatbots were simple: as long as you asked them the right questions, they could give you the right answers.

Today, chatbots can be a lot smarter (and Intelligent Virtual Assistants even more so) thanks to advances in artificial intelligence (AI) that shift from pre-programmed questions and answers to helpful conversations. 

We’re now seeing new generations of Conversational AI that have already shifted customer expectations across industries, with people expecting to be able to get answers and find what they’re looking for faster than ever before. In most cases, meeting those expectations is going to require a shift from the simple chatbot to the Intelligent Virtual Assistant.

What’s the Difference Between Chatbots and Intelligent Virtual Assistants (IVAs)?

AI is essentially a series of algorithms that has been trained to understand patterns and make decisions based on those patterns. Conversational AI specifically looks at the patterns in the way that people talk. Both chatbots and IVAs fall under the umbrella of Conversational AI, a combination of technologies that can be used to create automated messaging between humans and computers. 

You can think of chatbots as Conversational AI with the training wheels still on. It’s simpler to program and can typically only handle simple back and forth. You build a list of questions and answers, and the chatbot can “find” the right answer when presented with a question that it’s been prepared for. The limitation is that the question has to be worded exactly as it’s programmed. This means that typos, misspoken words, and even regional differences in how questions are phrased can mean that the user experiences a lot of, “I don’t understand” responses. 

Chatbots are often designed to collect information, acting as a back and forth to essentially fill out a form. An example would be a customer service bot that asks for your first name, last name, and email address before telling you that someone will be emailing you shortly. The bot itself can’t provide help and just manages the information intake.

Over the years advancement in the technology and shifting customer expectations have led to some chatbots becoming more technically complex. There are even chatbots that utilize Natural Language Processing (NLP) which lets the chatbot understand different variations of a question even if it wasn’t specifically programmed to understand the exact wording used.These chatbots start to edge closer into the world of the Intelligent Virtual Assistant, which includes experiences like Apple’s Siri, Amazon’s Alexa, and Google Assistant. As the technology becomes more streamlined, its availability has extended beyond Big Tech and is now more accessible for small businesses than ever before.

IVAs are known for their ability to understand versus just respond. It’s the difference between having a conversation with a robot that has been programmed to listen to specific words and having a conversation with someone who can listen for what you mean, even if you don’t use the exact words they’re expecting.

Why Is Conversational AI Important for Businesses?

Conversational AI has the potential to revolutionize how we interact with businesses, both by making existing customer service models more efficient and by creating entirely new ways for consumers and companies to communicate. As the business world has shifted to allow for more remote access, that’s translated to an acceleration of the shift to a digital-first world.

While chatbots have the ability to collect information and pass it along to a backend system, many users now anticipate that a chatbot experience will only get them so far toward meeting their needs. IVAs are typically more focused on a higher level of support or task completion, which requires deeper understanding and communication between the person and the computer. 

The ability to gain efficiencies, quickly get people answers and support, and scale operations without adding additional resources is going to become ever more important as the economy continues to struggle and shift.

How Does the Intelligent Virtual Assistants (IVA) User Experience Compare to the Chatbot User Experience?

The two biggest key differences between them are where they get their information and how they deliver that information. At a high level, chatbots offer up information for self-service whereas IVAs process information and deliver it conversationally, as a service.

The Conversational AI Knowledge Base

Chatbots typically pull their responses from a manually compiled list that maps intents to replies that should either answer the question or keep the conversation moving along. What that means in practice is that a human has to sit down and think through everything someone might say or ask, all of the different ways they might say or type it, including typos, and then associate each intent to a response that is perceived to be helpful. That could be an answer or a link to a place within the website where the user can find the answer themselves. 

These intents and responses need to be managed and updated manually. For a business, that means manually updating the chatbot whenever an answer changes or a URL is updated. From a user experience standpoint, chatbots offer up a limited set of responses with a high likelihood of inaccurate information over time.

IVAs are able to leverage AI to pull responses from broader lists, and they are able to learn new phrases and automatically update intents. They also have the ability to go beyond offering up links for self-service; XAPP AI powered IVAs are even able to instantly comb through all owned online content, identify the most up to date information and share it back as a conversational response rather than offering a link. The delivery of the information feels more natural but it’s the ability to go beyond the manual, predetermined set of static intents, that can have the biggest impact because as your website is updated, your responses are, too. That means less time upfront training the bot after the initial setup, they can answer questions quickly and accurately, without requiring manual updates to static lists of intents and responses. 

The AI that’s built into IVAs can also be used to power unique features, like suggested autocomplete as users type a question, to make things even easier for the user.

visual of XAPP AI powered chat with autocomplete inputs appearing as the user types

Why Do Chatbots Dominate the Conversational AI Space?

Let’s start by looking at why a company might want to leverage Conversational AI and then dig into why chatbots have historically been the go-to solution. 

With a Conversational AI solution, you can:

  • Save time and money by enabling employees to handle more customer requests on their own

  • Increase the efficiency of your support team by automating routine tasks such as order tracking and ticket creation

  • Engage prospects across multiple channels with personalized messages that help route them appropriately to sales

These are really compelling reasons and become more compelling when you’re a smaller organization with less resources. Chatbots historically have required the least amount of technical knowledge and capital to set up. 

For years, the technology that powered IVAs was inaccessible. It was expensive, technically complex, and required hours of expert daily management and maintenance. Most of the original use cases were simple, things like collecting information and offering up a small set of commonly searched for links. Simple chatbots made sense for simple use cases. 

As that dynamic has started to shift, with user expectations growing and companies like XAPP AI bringing IVAs into the mainstream, we’ve found that the term “chatbot” has been really sticky. If someone engages with a computer through a chat user interface, nine times out of ten they will call it a chatbot – even if it’s technically an IVA. A rose by any other name…

Conversational AI for Everyone

XAPP AI is here to help organizations build Conversational AI experiences that people want to use. That means investing in the continued evolution of our Optimal Conversation Studio™ which can have you up and running with a custom Intelligent Virtual Assistant in less time than it takes to watch an episode of Stranger Things.

Contact us to discuss how we can help any size business launch Conversational AI experiences that people want to use.