According to an upcoming HubSpot research report, 71% of people are willing to use messaging apps or chatbots to get customer assistance, and many do it because they want their problems solved fast. Even though this may not seem like a big number compared to other communication channels, it's pretty significant and growing even more quickly than expected.
With the rise of digital technology, businesses can no longer rely on traditional service methods such as emails and live representatives for assistance. Technology is helping pave the way for a new kind of customer experience, and chatbot technology is leading the way.
To get the most from it, you need to know its potential capabilities and how they can relate to your specific needs. However, one thing is clear. If you leverage chatbots properly, you could be one install away from providing a superior user experience at a fraction of the cost you can with traditional means.
If you're curious about chatbots and how they work, you're in the right place.
What is a chatbot?
A chatbot is an online instant messaging tool programmed to converse with humans and perform specific tasks. As the name suggests, chatbots were initially limited to text-based interactions. However, as the technology has advanced, these interactions now extend to other input methods, including voice and touch.
Chatbots primarily focus on customer service, but their uses are quickly expanding to perform routine tasks that humans typically carry out. Today, chatbots provide an enhanced customer experience and create an efficient work environment for small businesses and enterprises.
They're so common in the digital business environment that they've become known by many names—virtual assistants, digital agents, virtual agents, conversational bots, and more.
How do chatbots work?
Chatbots process the information provided by the website visitor and then generate the correct response. They help answer questions and in many cases handle functions such as scheduling a demo, booking an appointment, or making a purchase. They're always available, even when your sales team isn't online.
A bot works by analyzing text or voice data input and then responding appropriately. It then delivers its response back to the user through a chat interface. Chatbot technology is used in several primary chat messaging platforms like Facebook Messenger, Slack, and Telegram.
There are two main types of chatbots:
Rules-based chatbots
Rule-based chatbots function according to a set of rules. This is a less complicated type of chatbot because it's only meant to answer specific questions drawn from answers stored in a database. Essentially, a rules-based bot is only as smart as it can be based on the data it can access.
Machine learning chatbots (AI bots)
Artificial intelligence (AI) chatbots function using machine learning and are programmed to understand human language, not just commands. They can understand more complex speech. They also get more competent and smarter as they converse with humans, learning what questions may need to be answered and what expectations may be made.
Types of Chatbots
One of the most exciting things about chatbot software is the variety of chatbot programs available. Chatbot technology has advanced so far that it can be difficult to understand the various functions and capabilities of different bots. As mentioned in the last section, we can separate two main types of chatbot applications into linguistic (rule-based) or machine-learning (AI) categories.
It's always important to keep an eye on the ever-changing world of chatbots and to adapt to customer experience trends and business needs. There are three main types of chatbots that consumers see today:
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Rule-based chatbots (click bots)
Rule-based or Task-oriented bots are designed to perform one specific function. They provide automated but conversational responses when asked questions. The bot cannot respond if a user asks a question outside the pre-defined list of questions.
That is why the rule-based chatbot needs to be designed in a versatile manner. For example, different kinds of media, including images, GIFs, videos, and audio, can be used to help.
A personalized approach (requires the prior requesting of the name or first initial) and different response options improve the user experience. Click bots are quickly designed, implemented, and inexpensive compared to AI bots.
We've all interacted with this type of chatbot before, whether we knew it or not. This kind of chatbot can be a valuable asset for a business looking to improve its customer service teams' control and flexibility and increase their productivity by handling common requests through automation.
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Chatbots with Artificial Intelligence (AI bots)
Chatbots that use artificial intelligence (AI) and machine learning are sometimes called virtual or digital assistants. They use sophisticated technology and advanced AI to provide more interactive, personalized, and data-driven customer experiences than rule-based bots.
Predictive Intelligence and Advanced Analytics can be used to personalize interactions based on user profiles and their past behaviors. They can even learn user preferences, initiate conversations, anticipate the user's needs, and provide relevant content.
Artificial intelligence is now an essential component of most apps we use in our daily lives. Some advanced artificial intelligence (AI) bots you may already have at home include Amazon's Alexa, Google Assistant, or Apple's Siri.
Natural language processing uses several fundamental natural language principles, including grammar, vocabulary, and semantics, to understand and replicate human communication. Let's take a closer look at how this works.
Natural Language Processing (NLP)
NLP refers to the process by which we break down sentences into their parts, analyze broken grammar, understand idioms and other elements, and recognize patterns to determine what the customer is saying. We often use different words for the same idea in everyday speech; natural language processing (NLP) allows bots to understand this.
Natural Language Processing (NLP) involves two main processes: understanding and generating.
Natural Language Understanding (NLU)
Natural Language Understanding (NLU) allows the bot to understand the user's intent using language features such as lexicons, synonyms, and more complex themes. Used along with rules, NLU identifies parts of speech to determine what the user is trying to do.
Response Generation
Once the bot understands what the user wants, it needs to translate its response from machine code into human speech. Natural Language Generation (NLG) allows bots to deliver personal responses beyond the kind of canned messages used by rule-based bots. With NLG, a chatbot can create a natural language response based on autonomous deep learning.
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Hybrid Chatbots
A hybrid approach benefits users from rule-based chatbots and artificial intelligence (AI) bots. They let you create conversational bots, an open-source operating system, and a consistent bot personality. They use machine learning to facilitate smart and more complex interactions using data and AI algorithms.
By adopting a hybrid approach, businesses gain the benefits of both SaaS and PaaS without having to choose between them.
What are the benefits of Chatbots?
As users demand more personalization from their brands, forward-thinking companies have adopted chatbots to deliver beyond customer expectations.
While humans can do this, there is a point at which they become too expensive to employ. That's one reason forward-thinking brands have started using chatbots to help them benefit from the following advantages:
- Facilitate seamless live communication
- Increases website engagement
- Reduce People-to-People Interactions with Customers
- Eliminate Tedious Time-Consuming Tasks
- Offer a Smoother Customer Journey
- Humanize Your Brand
- Prioritize customer prospecting with real-time notifications
- Generate more qualified leads
- Combat customer churn
- Make Marketing More Targeted
How AI chatbots drive business value
Today, companies and brands have a lot to juggle between their customer support, marketing, and sales teams. It's surprising that marketers have time to breathe when they're always trying to stay on top of consumer expectations.
Fortunately, AI chatbots can help businesses automate business operations and improve customer experiences by providing personalized, accurate, and timely conversations. People value chatbots because they provide quick, intuitive, and convenient answers to their questions.
Chatbots offer a number of benefits over legacy customer support channels such as phone, e-mail, and live chat. With the help of AI, enterprises can use technology to not only empower customers but also boost employees' productivity and reduce operational costs as well.
Here are some key areas where virtual assistants can drive value to both businesses and consumers:
- Answer customer questions immediately, eliminating the need for them to wait on hold.
- Increase revenue by guiding potential customers to products and services they might be interested in.
- Keep costs down by doing the work of multiple employees
- Free employees from low-value tasks to focus on high-value customer interactions.
- Open up new channels of communication without tying up additional resources.
- Build brand loyalty by offering dynamic and memorable self-serve customer experiences.
- Make your business available round the clock so that customers can contact you when they want to.
5 Most Powerful Platforms to Build a Chatbot
We've compared the best chatbot platform on the web, and we've narrowed down the list to the most popular ones. The best part? Most of them are free to try and perfectly suited for all businesses.
Chatbots Can Bring Customers and Companies Together
Chatbots don't just offer seamless customer support, they also help you close sales faster. They've improved so much that they're able to facilitate payments too.
Chatbots sound great, right? If you want to learn more about implementing a bot or discovering the full potential for your current platform, contact the C51 team!
Get Started with HubSpot's Chatbot Builder for Free
Have questions about specific chat platforms, Consumer 51 has worked with including their pros, cons, and pricing? Reach out to us by filling out the form below.