Harnessing the Power of Conversational AI

19 Sept 2023

5 min read

Picture this. You're a busy shopper, rushing to get everything on your list. Suddenly, you have a question about an item but there's no one around to ask. That's the common situation facing shoppers on websites.

But now, that’s where Conversational AI comes into play. Customers no longer have to call a switchboard, or wait for a human to jump on the live chat. Instead AI chatbots can triage the request and route it to the right place.

The benefits to Conversational AI are massive – improved response times, higher customer satisfaction, and increases in online conversions.

What is Conversational AI for Ecommerce?

At its best, conversational AI should be like having a super-smart sales assistant who never gets tired and can chat with hundreds of customers at the same time.

This form of artificial intelligence uses natural language processing (NLP) to interact in human-like ways. Whether it's answering frequently asked questions  about product information or delivery policies, or helping navigate through checkout, these systems make online shopping smoother and more efficient.

Existing conversational AI would then respond to a question with an appropriate, pre-programmed response. The latest conversational AIs are experimenting with using generative AI to automatically respond, without a human having checked the response first. This has its risks, but if the success rate is high enough, then it can speed up the process immeasurably.

Imagine a message popping up saying "Have you got any questions about this product? Just ask here." or "Are you having trouble checking out? Let us know."

The result? Customers get a better service, and without adding extra workload on your staff. Plus, with machine learning capabilities built-in, conversational AI continually improves its responses over time as it learns from past interactions - much like how we humans learn.


How Does Conversational AI Work?

The combination of NLP and machine learning is the driving force behind conversational AI. NLP allows the system to understand human input, while machine learning helps it improve with each conversation.

Natural Language Processing, or NLP, is a field within artificial intelligence that gives machines the ability to understand human language as it is spoken naturally.

In essence, conversational AI takes your question, breaks it down using NLP to comprehend its meaning, then uses machine learning to give an appropriate response based on past interactions - all this in real-time.

For a retailer, this would mean training it on your products, policies and FAQs. Then you would go about shaping the responses to fit your brand and your tone of voice, selecting which responses are best and allowing the machine to learn how to adapt to specific situations.

For anything that a conversational AI cannot answer directly, the best response is to route it to a human. If the same issue keeps getting passed to humans, you can then build an automated response to it.

Benefits of Conversational AI for Retailers

Retailers are finding great value in using conversational AI. This technology offers several key benefits that can dramatically improve customer service.

Firstly, it's about speed. Conversational AI helps provide quicker responses to customers' questions, significantly reducing wait times compared to traditional methods of customer support.

IBM reports, with the help of these tools, businesses have been able to cut response times by up to 99%. Now that's something. Even if that is just a first response, it can be helpful for customers to know that their request has not just been lost in the ether, and you can set expectations for how quickly they'll be dealt with.

Secondly, there’s accuracy. Natural Language Processing (NLP), a fundamental part of conversational AI, makes sure every question gets the right answer first time around - no more back and forth trying to clarify misunderstandings.

Next is personalisation. The MarTech Series explains, these systems learn from past interactions and can adapt their responses accordingly. So your shoppers get a personalised experience every single time they interact with you.

But the most important benefit is that conversational AI can not only RESPOND, but can RESOLVE customers' issues without a human response. using integrations with other platforms it can check on order status, check stock availability, and a whole host of other functions, allowing it to actually find the right answer to a specific customer's issue.


Examples of Conversational AI in Retail

Conversational AI's ability to engage customers on their terms, provide personalized shopping experiences, and handle customer service inquiries with ease is proving a hit with retailers.

Chatbots, for instance, are now the most common example of conversational AI platforms. But they can also be deployed through any channel, including email or even voice if enabled with automatic speech recognition.

Companies are experimenting with voice-activated shopping assistants so customers don't get stuck listening to a voice say "Press 1 for Sales". By just saying what they need, shoppers can make purchases without even touching a button.

Challenges of Implementing Conversational AI

Getting started with conversational AI isn't always a walk in the park. Grasping and traversing the complexities of Natural Language Processing (NLP) is a major challenge to be overcome when implementing conversational AI. It's like learning to read a new language, but this time you're teaching machines.

The second hurdle comes from training these systems on diverse types of conversations. Just as we humans need different experiences to learn, so do our digital counterparts. To build your own chatbot it needs to understand various contexts and responds accurately, which requires  vast datasets.

Alternatively, conversational AI platforms exist that provide out of the box and ready-trained AIs that are built to understand a range of retail-specific use cases. Such as "Where is My Order", Returns, Refunds, and others, most of which are standard across all retailers.



Conversational AI is no longer a thing of the future, it's transforming retail here and now. To understand how you can deploy it, speak to our team today.