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Artificial Intelligence as the Foundation for Intelligent Chatbots

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AI chatbots are an emerging technology that is not only here to stay but also has the potential to be one of the most disruptive forces of our era. They're getting better every day, offer personalised services and handle common customer service queries using natural language.

AI chatbots are a new and cutting-edge way to interact with your customers online. They can be used for marketing, sales, and customer service more efficiently than other methods. If you're interested in learning more about what artificial intelligence chatbots can do for your company, then read on!

What's Artificial Intelligence (AI)?

The term Artificial Intelligence, describes the capability of machines to perform human-like functions such as learning, reasoning, problem-solving, and even creative expression. The acronym was coined by John McCarthy who along with Marvin Minsky and Claude Shannon was one of the speakers at the Dartmouth Conference, which ran from June 2-6 1956 at Dartmouth College (Hanover, New Hampshire).

The meeting aimed to to define the scope of Artificial Intelligence, share ideas and solve problems by interacting with each other informally. This idea proved successful as it led to several long-term collaborations and the establishment of AI as a formal academic discipline.

Since then artificial intelligence has gone mainstream. Although we are still far from the artificial intelligence depicted by the character Data in Star Trek, humans have come a long way in developing machines that can learn from huge amounts of underlying data and understand humans not only at the logical but also at the emotional level and respond accordingly.

AI is Becoming the New User Interface

IDC predicts that by 2024 the majority of customer interactions will be AI-enabled. That's a bold claim, but the reality is that natural language processing already allows us to engage in human conversations, monitor customer sentiments, respond quickly, and provide greater relevance in all customer interactions.

AI is going to be available on any device, making it all the easier for businesses to deliver exceptional experiences no matter where your clients are. It will be highly engaging and intuitive, with no training required to use it. Moreover, AI will facilitate one-on-one communication where the system learns the user and not the other way around. It will run the business by becoming central to the overall service experience.

What's an AI Chatbot?

An AI chatbot is a virtual agent that uses natural language processing and machine learning to interact with customers on websites, messaging apps, social media, via text or speech. It can carry out a sequence of interactive conversations on any subject that its programming has been set to. They're great for customer service and communicating with prospective customers as they can answer questions and provide detailed responses.

How do AI Chatbots Work?

AI chatbots use a combination of Machine Learning, Natural Language Processing and other algorithms to learn and understand human interactions and how they evolve. Algorithms are a set of step-by-step instructions that tell a machine what actions to take so it can "think" and solve problems in the same way a human would. They have been key in enabling chatbots with limited capabilities to become more useful and responsive.

Natural Language Processing (NLP)

Natural language processing is a field of computer science that aims to understand and represent human languages in a way that machines can utilise. It not only enables them to derive the meaning behind every word and sentence, but also discern tone, intent, humour, sarcasm, and other contextual elements in the conversation.

NLP also gives the chatbot the ability to interact with customers using natural language, instead of merely looking for keywords or phrases. They not only understand what’s being said but also why. The benefit of an AI chatbot that uses NLP in dealing with users is that the interaction “feels” human. People are less likely to grow frustrated at “talking to a machine” because it feels like talking to another human being.

Natural Language Understanding (NLU)

Natural Language Understanding is a subsection of Natural Language Processing that focuses on understanding the received input. One of the key things it tries to determine is the intent of the communication. It recognises the intent of the text and enables building highly engaging user experiences and lifelike conversational interactions. It’s used to ascertain a user’s intent, maintain context and fluidly manage the conversation. This helps to produce more accurate and appropriate responses during interactions.

Thanks to Natural Language Understanding, chatbots can be aware of the user’s context, draw conclusions based on that knowledge, and guide users on the topic of conversation. To understand not only what’s been said, but also how a customer felt during the interaction, NLU uses a process called sentiment analysis.

Sentiment Analysis

The Oxford dictionary defines sentiment as “A view of or attitude toward a situation or event; an opinion” and also as “General feeling or opinion” or “A feeling or emotion”.

Using a wide variety of factors, sentiment analysis relies on predefined rules and machine learning algorithms and attempts to first determine if the person chatting is in a positive, negative, neutral, or mixed mood. It then tries to ascertain the person’s emotion, followed by the emotion’s current intensity. It can be used as a powerful tool to accelerate informed decisions, adapt responses in real-time, and improve customer experience.

Natural Language Generation (NLG)

Natural Language Generation is a subfield of Artificial Intelligence and is used to transform data into natural-sounding responses. It’s mostly useful when the underlying data is constantly changing and needs to be exposed to end-users through conversational interfaces.

In contrast to rule-based chatbots that have predetermined answers stored in a database, a chatbot that uses Natural Language Generation must piece together the correct way to say something in the chosen language, and it must be semantically and syntactically correct. The result can vary from answer to answer, providing a much more realistic interaction with the chatbot which can deliver outstanding results by communicating always up-to-date information at an exceptional scale.

Machine Learning (ML)

Machine learning is a subset of artificial intelligence. The goal of ML is to develop computer programs that can automatically learn and improve from experience without specifically being programmed.

This technology enables the software program to identify patterns, classify data and make predictions, that can be utilised to create personalised experiences for customers. Under ML, various algorithms can be used to achieve specific goals. These algorithms are building blocks that help in solving complex tasks by providing solutions step-by-step.

Machine learning helps chatbots learn user preferences, adapt to their needs, and classify new requests to better handle them in future interactions. This technology makes chatbots much smarter by giving them human-like intelligence.

Machine learning algorithms can also be used to generate individualised content recommendations, which work as teachers did at school by explaining things step-by-step until their students 'get it'.

Benefits of Using an AI-powered Chatbot in Business

According to Gartner, artificial intelligence (AI) is now the second-most sought-after type of technology by businesses, due to its ability to make better decisions and act faster than humans or rule-based programs.

Chatbots equipped with natural language understanding reduce the amount of effort people have to put into communicating with them, making the process more effective. Customers no longer need to remember specific commands or keywords because bots offer a more natural and human-like experience.

Intelligent chatbots are the future of customer service. They offer numerous business benefits, including improved response times, increased productivity gains, shorter sales cycles, and improved customer experience than traditional means such as live chat or email.


AI chatbots are increasingly becoming the new norm. They are used by companies across all industries as an efficient way to communicate with customers on their website or through messaging apps like Facebook Messenger or WhatsApp.

Intelligent chatbots offer personalised experiences, handle common customer service queries, and can be leveraged for marketing purposes to boost sales with high-quality upsells and cross-deals. AI chatbot software can do more than any human employee would be capable of achieving in a typical workday.

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