The role of Chatbots and Virtual assistants in Customer service

Terralogic Inc
5 min readMay 17, 2023

In recent years, the customer service industry has seen a significant increase in the use of chatbots and virtual assistants. These automated software applications have grown in popularity among businesses of all sizes due to their ability to streamline customer interactions and improve the overall customer experience.

This blog intends to provide an overview of chatbots and Artificial Intelligence (AI) virtual assistants, as well as to investigate their role in customer service and showcase real-world examples.

Chatbot Vs Virtual Assistant

Chatbots:

A chatbot is a type of software application that communicates with humans through natural language processing and machine learning. Chatbots are programmed to mimic human conversation by comprehending and responding to user queries via text. Chatbots can understand the user’s message and respond with pre-written answers or machine learning algorithms using NLP.

While chatbots are useful for answering simple and predictable questions, they may struggle to answer complex or unexpected questions.

Chatbot features

  • Basic FAQ Automation
  • Predefined chat flows
  • Solves basic customer queries

What can chatbots do?

In summary, chatbots are software programs that can simulate human conversation and are used to help users with basic tasks or answer questions. The primary goal of using a chatbot is to reduce the workload on humans while also saving time and resources.

Chatbots have found their way into numerous industries and use cases, serving a multitude of purposes such as customer service, sales, marketing, and more.

AI Virtual Assistants :

AI virtual assistants, on the other hand, are more advanced and can handle more complex queries and tasks. They use machine learning algorithms to understand user intent and provide personalized recommendations and solutions based on user data and preferences. Siri and Alexa are examples of AI virtual assistants. Recently released ChatGPT (created by OpenAI Inc.) which is speculated to replace Google in the future, is also an example of an Intelligent Virtual assistant.

Virtual assistants generally perform with the same capacity over text or speech interfaces. This feature allows businesses to offer a more personalized and engaging

customer experience, which can help improve customer satisfaction and loyalty. AI virtual assistants can understand and respond to user queries that are in complex phrasings.

Replika, Mitsuku — virtual companion apps are also AI virtual assistant chatbots.

AI (IVA) Intelligent virtual assistants features :

  • Powered by strong NLU
  • Ability to understand and retain context
  • Deep domain knowledge
  • Multi-lingual
  • Customer-oriented

The primary goal of using an AI virtual assistant is to increase the productivity of its users and save them time.

What is their role in customer service?

Both chatbots and AI virtual assistants play significant roles in customer service by providing automated support to customers and helping businesses improve their customer engagement and service levels.

Why is customer service important?

Customer service is critical because customer support is responsible for keeping the customers happy. Good customer service can result in increased upsells and cross-sells for the company. Retaining customers is very important because it is less expensive to keep a customer than to acquire a new one. Good customer service makes sure that the customers are happy and persuade them to use the product/service in the future.

Chatbots in customer service:

Generally, chatbots are used to handle simple customer queries and requests, such as answering frequently asked questions, providing product information, and assisting customers with simple tasks such as account login and password reset.

Chatbots can help reduce the workload on customer service teams and improve the response time for customers by handling routine inquiries.

Chatbots have grown in popularity as a tool to provide customer service, with many businesses utilizing them to provide quick and efficient responses to customer inquiries.

A variety of businesses are currently using chatbots to provide customer service.

Chatbots with AI

Many chatbots and virtual assistants utilize a blend of rule-based and learning-based AI techniques. This involves programming a set of rules for handling customer service inquiries, while also leveraging customer service data to enhance its performance through machine learning.

Chatbots and AI virtual assistants can be combined to offer an optimal solution for users. For instance, Kotak’s Keya Virtual Assistant and Bank of America’s Erica are chatbots that possess the features of an Intelligent Virtual Assistant.

Additionally, Facebook has a chatbot platform, Facebook Messenger Platform, which enables businesses to develop and deploy chatbots to handle various tasks such as customer support and FAQs.

Advantages & Limitations

The use of chatbots and AI virtual assistants for customer service has become increasingly popular in recent years, with both technologies offering benefits and drawbacks.

Advantages:

  • Round-the-clock customer service: Reduces wait times while increasing customer satisfaction.
  • A low-cost solution: Provides efficient solutions at a fraction of the cost.
  • Handle a large number of inquiries at the same time: Increased efficiency, and lowered business costs.
  • Performs routine tasks that have been automated: Customer service representatives can spend their time on more complex issues.
  • Collect and analyze customer data: Provides valuable insights into customer behavior and preferences to businesses.

Limitations :

  • Complex inquiries: Chatbots typically struggle to handle complex inquiries.
  • Initial investment Resources and expertise: Required upfront to set up the technology and its maintenance. Might not be feasible for every organization.
  • Technical errors: Just like any other technology, chatbots and virtual assistants can go through technical malfunctions, out-of-capacity, and server issues which can lead to disrupted customer interactions.

Summary

In conclusion, chatbots and AI virtual assistants have become essential tools for modern businesses in providing cost-effective and efficient customer service. With the ability to work around the clock, they offer customers quick and personalized solutions to their queries, improving the overall customer experience.

While chatbots are useful in handling simple and predictable inquiries, AI virtual assistants are more advanced and capable of handling complex queries and tasks. Additionally, virtual assistants can learn and improve their performance based on customer interactions, making them an asset to any customer service team.

The real-world examples highlighted in this blog demonstrate the benefits that businesses can achieve by implementing chatbots and AI virtual assistants, such as reducing response and resolution times, improving customer engagement, and saving time and resources. Overall, chatbots and AI virtual assistants are transforming the customer service industry, providing businesses with a competitive edge and customers with improved experiences.

You can enhance your customers’ experiences with cutting-edge AI chatbots and virtual assistants, revolutionizing your business operations effortlessly. Discover our comprehensive suite of IT services for seamless automation and increased efficiency.

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Terralogic Inc

Terralogic Inc is the leading software development IT services company in Sandy, Salt Lake & Ogden city in Utah, Dallas — Texas, San Jose — California’s Bay