Chatbots vs conversational AI: What is the difference?

Customer service is a major priority for B2C businesses

Rebecca Yang

Marketing Manager of AI Rudder
chatbots vs conversational ai

Customer service and experience management used to be seen as a backburner cost centre that companies needed to maintain, “or else”. Now, though, the link between customer experience and a healthy bottom line is starkly defined and measurable.

Companies that deliver great customer service usually retain more customers, enjoy stellar reputations (and therefore, strong word-of-mouth), and are more likely to convert would-be detractors into repeat customers. On the flip side, once consumers are disappointed, 91% of them won’t come back.

Though the value of maintaining positive relationships with customers is self-explanatory, the high demands of quality service can exhaust even the hardiest employees. Now that advancing technologies such as artificial intelligence, automation, and natural language processing have converged as conversational voice AI, there is a golden opportunity to scale operations affordably while still improving customer satisfaction.

At one point, voice robots were highly innovative

Though they may not be the first to come to mind when you think of bots, telephone robots are now ubiquitous in banks, agencies, and most other customer-facing industries. First developed to help customer service teams deal with more clients than they could manage, this technology is powered by pre-recorded messages that callers can interact with by selecting their options. Those in the know usually refer to this technology as “Interactive Voice Response”.

These automated IVR robots are successful in doing exactly what they’re designed to do: filtering inquiries from customers and solving their problems without having to involve an overloaded CS representative. Some even enjoyed basic innovation in recent years, gaining the ability to conduct perfunctory speech recognition and direct customers to the department they needed.

Nowadays, though, these robots may not be enough: an obviously robotic voice can dissuade customers from staying on the line or make them even more upset. “Dumb” or unintelligent robots also can’t detect intent or obtain customer feedback, so their usefulness and functionality are limited for the sales and marketing teams.

Voice AI is the next frontier of customer interaction

Artificial intelligence in the consumer space is still relatively new, but it brings incredible promise. Voice AI robots can listen to speakers and receive or interpret directives, even if they aren’t phrased in a specific way. With the ability to understand and use human languages (natural language processing), voice AI chatbots speed up processes, increase productivity, and improve the customer experience.

Richer conversations
Intelligent voice robots can converse with the customer and deliver personalised information based on spoken queries. For example, a voice AI used for repayment collection can answer questions like “how much money do I owe?” and “who are you?”. When used in marketing or sales functions, voice AI can answer questions such as “What product are you offering me?”. This is a major step up from IVR, which can only transmit preset (fixed) information once.

Intelligent insights
Voice AI features can analyse and provide quantitative feedback indicating user and/or customer intent. This makes corresponding processing and follow-up much easier, and therefore greatly increases operating efficiency. Datasets from IVR robots are also limited to cursory statistics.

Goal-oriented discussions
Voice AI’s ability to understand complex conversations makes them suitable agents for completing preset goals. A few instances:

  • Arouse users’ interest in a product (marketing)
  • Confirm Cash-on-delivery (COD) time and place (sales and fulfilment)
  • Collect customer information for Know-Your-Consumer requirements (compliance)

Their conversational nature allows them to encourage the desired response during conversations with callers. In the case of collections, voice AI can be designed to nurture callers towards verbal commitments – customers who make a verbal promise over the phone will be more inclined to repay on time. On the other hand, IVR is more suitable as a source of fixed information and can rarely achieve such complex goals.

Improved retention and satisfaction
Modern voice robots are available in a number of languages and speak far more naturally than the voice assistants of the last decade. Because Voice AI is indistinguishable from a real person, customers are much less likely to hang up. Our past data has also shown that, as far as collection robots are concerned, general voice robots will have a retention rate of about 3 points higher than that of IVR, and about 1 point lower than that of human agents.

Experience the difference with AI Rudder

While voice AI is more expensive than IVR, you may want to experience the features before making a switch. At AI Rudder, we harness voice AI technology to help businesses solve B2C communication challenges, reduce operating costs, and increase efficiencies – we’ll help you determine whether the increase in value can cover the cost.

Ready to begin automating the planning, execution, and completion of your most repetitive tasks? Engage with AI Rudder today and learn how you can create faster, frictionless experiences for consumers.

Related Posts

voice ai tech a game changer for fintechs

Can Voice AI be a game changer for Fintechs?

The boom of FinTech in the past decade has been…

Read More

3 strategies to drive business impact at scale with voice ai automation

3 strategies to drive business impact at scale with Voice AI automation

In 2022, AI-powered automation is well and truly out of…

Read More

how to take the pain out of kyc

How to take the pain out of KYC in financial services

The rapid growth and adoption of fintech in Southeast Asia…

Read More