A chatbot is a dialog system – a program that enables text- or voice-driven communication between humans and machines. Chatbots are the basis of virtual assistants such as Alexa, Google Assistant or Cortana. Dialog-based supports on websites also use speech bots.

Detailed explanation of  Chatbots

“Hello, my name is Tom. What can I do for you?” When a small avatar pops up on the bottom right of a website, it’s usually not a human but an algorithm behind it: a chatbot. More and more companies are using this service. Especially in the support area, voice bots are proving to be effective alternatives to human interlocutors. The voice robots are working ever faster, ever cheaper – and making fewer and fewer mistakes. Chatbots in marketing are used to bring users to the desired conversion.

The term chatbot is made up of “chat” and “bot” for robot.

Avatars are often used on support websites to give users the impression that they are talking to a natural person. However, these avatars are not a prerequisite for a chatbot.

Areas of application for chatbots

Chatbots avoid long queues in telephone support. If a company does not offer this service to its customers, it will not be able to keep up in the long term. Chatbots are therefore among the most important future investments of all. Studies show a steady increase in voice bots in the service sector.

Many companies have realized that outsourcing such services to specialized firms is profitable. This does not mean that employees who previously worked in communications have to be laid off. Rather, they are deployed elsewhere to answer more complex or specialized inquiries. The use of human labor for tasks that can be solved much more effectively by machine blocks valuable resources. Support from artificial intelligence therefore has a positive impact on the overall quality of a service.

Hybrid forms between machine and human communication are common. For example, if a digital assistant is unable to analyze the intention of a request, the customer is redirected to human support.

Chatbots are also increasingly being used in online marketing. They can be used on product pages or landing pages, for example, to increase the probability of a conversion. For example, if a customer moves around a product page for a certain amount of time, an avatar will appear at some point and offer its help. The customer is thus offered an additional incentive to find out more about the product. In the marketing use of chatbots, the manner of address plays a particularly important role:

The ideal voice bot is not only friendly. It also speaks the language of the target group. The closer the bot comes to this requirement, the more likely the customer is to respond.

How does a chatbot work?

Ultimately, a chatbot is merely an algorithm, i.e. a program. The distinctive feature of voice bots is that they have to respond to inputs that usually do not meet the strict logical, clear and simple requirements of a programming language. Natural language is emotional, complex and multifaceted.

So the most difficult problem of programming chatbots is to figure out the user’s intention from an input (speech or text). Roughly speaking, a speech bot program works with three basic entities:

Utterance: this is the entire input, for example, a sentence (“Show me yesterday’s news!”).
Intent: This is the user’s intention: what does he want?
Entity: This refers to the important meaning-bearing units in the Utterance or the keywords of a statement (“news” and “yesterday”).

Because the keywords also have a special significance for chatbots, there are many points of contact with search engines here. Therefore, many assistance systems work together with search engines such as Google to provide information.

If the individual components (entities) of the input are still not sufficient to provide a satisfactory answer, the virtual support employee asks further follow-up questions until the meaning of the query is clear. The principle is similar to a mind map: The program moves further from the general to the specific with each branching.

With further technical development, it is foreseeable that chatbots will gradually simulate human communication better. Because the formula applies:

More computer power + larger databases = better chatbots.

What are the advantages of digital dialog systems?

The advantages of chatbots for companies and marketing are clear: Any communication with the customer that is essentially characterized by recurring elements can be standardized. In such cases, chatbots are effective and inexpensive alternatives to natural communication. They are also less prone to errors.

Chatbots shorten queues and usually provide faster responses than human employees.
The error rate of responses can be reduced step by step – automated through the use of artificial intelligence (both in training and real-life applications).
Virtual assistants reduce the inhibition threshold for many customers to contact the company.

Studies show that the acceptance of chatbots and artificial intelligence is growing continuously. Because ultimately, the quality and reliability of an answer is decisive for most people. The way in which this answer comes about plays only a subordinate role. That’s why many people today expect from the outset to be connected first to a machine when they first make contact – whether on a website or in telephone support.
Chatbots train with artificial intelligence

In order for chatbots to give the most accurate and natural answers possible, they need to be trained. The broader the database of answer options, the more reliable the results. Speech bot algorithms need a solid base of training data. Gradually, the programs recognize correlations and improve patterns of recognition.

With artificial intelligence, the programs evolve themselves. They work on the principle of trial and error. They rank the input and subsequent responses according to success or failure. This process is applied either during real operation or under test conditions.

Clearly, data protection also plays a role in chatbots. After all, digitized communication is easier to intercept and make available for one’s own evaluations. For this reason, data protection regulations must be consistently observed during both operation and testing.

Chatbots can be used wherever queries arise in large quantities. The constant advancement of algorithms for communication means that chatbot responses are getting better and better. That is why companies are increasingly using voice bots to improve their service.


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