Overview of AI Chatbots

Overview AI Chatbots

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Language is a tool to communicate and make sense of an infinite world, through a finite set of symbols. Understanding language and communicating with humans is what artificially intelligent chatbots strive to do.

AI chatbots (sometimes called chatterbots) are intelligent computer programs that understand the intent of human queries and act on them. Modern chatbots understand both verbal and written forms of language.

AI chatbots are gaining popularity in a number of fields, amidst the increasing global digital communication environment.

A recent study found that the presence of virtual assistants provides an enhanced user experience to people. Another study sees the potential that an AI chatbot carries to build a strong relationship with customers because of its persuasive capacities. The global AI chatbot market size is now expected to be around $3.4 billion by 2030.

Some of the primary reasons for the growth in this field of AI are the prevalence of digital communication, the availability of a large amount of data, and the emerging industry 4.0.

In the midst of growing digital networks, it takes a toll on a business to keep up with customer demands for immediate support and quick resolutions to maintain customer satisfaction.

So how do chatbots help companies retain their customers and why should you think about using an AI chatbot?

How do chatbots use AI?

Artificial intelligence is an imitation of human intelligence. In short, chatbots that are powered by AI, think and behave like us.

AI chatbots use Natural Language Processing (NLP) and machine learning (ML) to understand people.

NLP is a data-driven process wherein a large amount of data is fed to the program. This data is then used to train the software to learn different combinations of speech.

As human language is compositional, it is ever evolving and changing. AI chatbots keep learning the nuances of the language and the context behind each query from every customer interaction.

After an AI chatbot receives an input, it breaks down the sentence into words and categorizes them. Then it uses NLP to make sense of each word. As soon as the software figures out the meaning of the phrase, it then acts on the phrase using all the contextual data it has been fed.

For example, let’s say a customer is chatting with an AI chatbot, and they write “Hello!” to the bot. Now the AI chatbot needs to understand the context of the greeting and that it is also equivalent to “Hi” or “Good morning.” The implication here is that the user wants to start a conversation. The chatbot will understand the intent behind the words and the context behind the query, to then produce an appropriate response.

artificial intelligence chatbot

Benefits of AI chatbots

There are many benefits to implementing AI chatbots in your business, especially in your customer support or service function.

Studies conducted on chatbots have observed the functionality of an AI chatbot in improving customer relationships, especially in business-to-customer interactions.

Although this technology is fairly new and continuously evolving, it has the capability to become an essential tool for all businesses in the coming years. AI bots will soon have the ability to anthropomorphize almost everything they come across. So the adoption of this technology is becoming easier as the technology gets better with time.

The major benefits include:

  • Ability to understand and communicate in many languages: With the advancement in speech recognition technology, chatbots can understand and speak in many languages and accents.
  • AI never sleeps, never needs a break, and is always on: Remove the need for customer support working 24/7 to service customers all over the world.
  • Chatbots do not tire or get frustrated: They are ready and willing to try many solutions until the customer is satisfied or the issue is resolved.
  • Integration into digital channels: Since chatbots offer omnichannel communication capabilities, they can easily be integrated into websites and other digital mediums your company already has in place.
  • Customization: Most chatbots are customizable and allow integration with a third party.
  • Better results: The ability of an AI chatbot to learn and change makes it persistent in its efforts to provide satisfaction to the user.
  • Cost savings: Needless to say, with the reduction of human staff, your company will save a significant amount on salaries.


AI chatbots are a great solution for improving customer service.

Although recent studies still show customers prefer to have conversations with humans, with the latest developments in AI, soon customers will not be able to identify if a conversation is with a human or with a very powerful AI tool.

We believe that the coming decade will see a rise in the global chatbot market size and customers becoming more and more comfortable speaking to a chatbot.

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