What is a Chatbot? Exploring 4 Parts of a Bot, Use Cases & How to use them in your Business

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What is a Chatbot? Exploring 4 Parts of a Bot, Use Cases & How to use them in your Business

4 Parts of a Bot:
1) Front End: SMS, Web, Google Home, Alexa, FB Messenger, Slack, etc.
2) Language Layer: Natural Language Processing/Natural Language Understanding. Eg: Dialogflow, Rasa, RulAI, Microsoft Bot Framework
3) Application
4) Database

What are chatbots? Why are they such a big opportunity? How do they work? How can I build one? How can I meet other people interested in chatbots?

A chatbot is a service, powered by rules and sometimes artificial intelligence, that you interact with via a chat interface. The service could be any number of things, ranging from functional to fun, and it could live in any major chat product (Facebook Messenger, Slack, Telegram, Text Messages, etc.).

“Many businesses already have phone trees and they do work though most users get grumpy using them. Text based response trees are much easier and faster and that is what I expect a lot of early bot interactions to be. Sometimes with ability to chat with a live person.” — Josh Elman, Partner at Greylock

That’s an important question because whether we realize it or not, the technology is steadily becoming a bigger part of our daily lives — so much so, in fact — that Gartner predicts that by 2020, the average person will have more conversations with chatbots than with their spouse. Driven by the promise of intelligent round-the-clock digital support, more companies are using them to engage with customers alongside the now classic channels of phone, email, and social media. A recent study found that 53% of service organizations expect to use chatbots within 18 months — a 136% growth rate that foreshadows a big role for the technology in the near future.

In the workplace, businesses use chatbots to boost productivity and efficiency in a range of ways. They help workers set meetings and reminders, and ask simple questions without stopping what they’re doing, to name just a few use cases. At the same time, all-purpose virtual assistants, such as Amazon’s Alexa, Apple’s Siri, and Google Assistant, are fast becoming the preferred interfaces for consumers to engage with brands across every industry.

But what’s behind the chatbot’s rapid rise in popularity? Are they really effective when it comes to delivering customer service support — and what impact do they have on the customer experience? Below, we explore what businesses need to know about chatbots, and what they can do to take advantage of this technology.

But what is a chatbot, exactly?

Technically speaking, a chatbot (derived from “chat robot”) is a computer program that simulates human conversation, either via voice or text communication.

Today, such programs can be customized and used in a variety of ways. These include:

Chatbots that communicate via smart speakers

Chatbots that function on smart home devices

Chatbots that function via popular chat and messaging platforms like SMS, Facebook Messenger, WhatsApp, and LINE

So, in addition to having a conversation with a person (such as a sales rep or a support agent, for instance), people can interact with software that helps find answers fast. Whether through typing or talking, a chatbot can connect with a customer. More importantly, it can influence a customer relationship by responding to requests faster while meeting expectations.

With the potential for delivering instant responses around the clock, chatbots can also free up customer support teams to apply their emotional intelligence to more complex queries.

What is an artificial intelligence chatbot?

More recently, however, chatbot systems have become much more sophisticated, thanks to significant advances in the field of artificial intelligence (AI). By harnessing enormous amounts of data and cheaper processing power, AI and related technologies — such as machine learning — are helping to dramatically improve chatbots’ quality of understanding and decision-making.

In particular, developers are using natural language processing (NLP) or natural language understanding (NLU) to build bots that can better understand human speech (or typed text). These technologies also make it possible to better discern the intent behind what someone is saying — and to respond more intelligently.

An AI-powered chatbot can also be trained to actively learn from any interaction with a customer to improve performance during the next interaction. For example, such systems can be trained to recognize customer frustration and switch any more complex interactions or problems to a human in the company’s support center.

“64% of agents with AI chatbots are able to spend most of their time solving complex problems, versus 50% of agents without AI chatbots.”