Virtual customer assistants or often

referred to as Intelligent Virtual

EBOOK Assistants are more advanced
Conversational AI systems that ser
specific purpose and therefore are

Conversational AI specialized in dialog management.

These applications are able to carry
Cheat Sheet context from one interaction to the
which enhances the user experienc
CHOOSING THE RIGHT SOLUTION
FOR YOUR BUSINESS Virtual customer assistants, also kn
as virtual assistants or agents, are
becoming increasingly popular as a
to provide customer service
conversations at scale because the
offer a more conversational and na
way for consumers to interact.
Consumers are not limited to typin
Conversational AI Cheat Sheet
Choosing the right solution for your business TRACTICA AND IDC BOTH IDENTIFY
Conversational AI has been instrumental in improving AUTOMATED CUSTOMER SERVICE AS THE
customer satisfaction, decreasing costs, and increasing NUMBER ONE USE CASE FOR AI-ENABLED
revenue. However, Conversational AI applications vary DIGITAL TRANSFORMATION.1
in levels of complexity and can result in dramatically
different end products, and thus different experiences,
for the end user.

With that said, before choosing a Conversational AI

solution for your business, it is important to determine not
only your business goals, but also the experience you want
to deliver to your customers. Our cheat sheet will help you
better understand the solutions available today, and the
experiences they deliver, so you can better evaluate which
is the best for your brand.

1
Tractica (2019, Q4). Customer Service Virtual Digital Assistants; IDC (2019, Q4). Worldwide AI System Spend for Automated Customer Service Agents.

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Conversational AI:
What is it and how does it work? CONVERSATIONAL AI APPLICATIONS
Before diving into specific Conversational AI, it is important INCORPORATE CONTEXT, PERSONALIZATION,
to understand exactly what Conversational AI is and how AND RELEVANCE WITHIN HUMAN TO
it works. COMPUTER INTERACTION. CONVERSATIONAL
DESIGN IS A KEY PART OF DEVELOPING
Conversational AI is the set of technologies behind CONVERSATIONAL AI APPLICATIONS THAT
automated messaging and speech-enabled applications FLOW AND SOUND NATURAL.
that offer human-like interactions between computers
and humans. It provides human-like communications
by recognizing speech and text, understanding intent,
deciphering different languages, and responding in a way
that mimics human conversation.

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4
How does it work?
Conversational AI uses various technologies such as Automatic Speech
Recognition (ASR), Natural Language Processing (NLP), Dialog management,
and Machine Learning to communicate with humans at a human level.

5
CONVERSATIONAL AI AT A GLANCE
ASR Natural Language Generation
Listening Offering response
Application receives information input from human—either Dialog management orchestrates responses, and converts
written text or spoken phrases. If input is spoken, ASR, also them into human understandable format using Natural
known as voice recognition, makes sense of spoken words Language Generation (NLG), which is the other part of
and translates them into machine readable format—or text. NLP. Application either delivers the response in text, or
uses speech synthesis, the artificial production of human
Natural Language Understanding speech, or text to speech to deliver the response over
Comprehending a voice modality.
Application deciphers what text means by using Natural
Language Understanding (NLU)—one part of Natural Machine Learning
Language Processing (NLP)—to understand intent behind text. Learning
The application accepts corrections and learns from
Dialog Management the experience to deliver a better response in future
Forming response interactions. This is called machine or reinforced learning.
Application forms the response based on its understanding
of text’s intent using Dialog Management.

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CONVERSATIONAL AI SOLUTIONS: FROM SIMPLE TO ADVANCED
Applied Conversational AI solutions range in abilities and therefore offer different experiences. Thinking about what your
brand wants to deliver is key in choosing the right application.

Chatbot
The simplest example of a Conversational AI application. FAQ bots, or what most of us know as chatbots, are basic answer
and response machines that have popped up on the websites and mobile apps of many brands as a way to automate simple
interactions between a brand and its consumers. Most chatbots do not use NLP or dialog management to offer dynamic
responses or machine learning to improve over time.

• Simplest example of Conversational AI

• Basic answer and response machine
• Does not use NLP, dialog management or machine learning

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Chatbot | CX Chatbot | Important considerations
When interacting with chatbots, consumers must type Chatbots are limited to text channels, which are rarely
the exact keywords required to receive the appropriate the channel choice of consumers or operational spend
response. The conversation flow is controlled by the bot, for companies. Therefore the impact on your customer
and the flow breaks or gets stuck in a loop when the experience and financials could be minimal. This also limits
bot is unable to understand the customer’s intention. your ability to scale across other channels and therefore
Chatbots often fail to maintain context over the course can’t grow with you as you continue to expand your CX
of a conversation and cannot understand customer intent initiatives as they change and grow with your business.
in many situations. Consumers often feel like they are
going around and around in circles to get questions
answered or information needed. This can lead to wasted
time on the consumers part and a frustrating experience
with your brand.

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 Can I order 4 apples please.

You got it. I’ve added 4 apples to your list.

It’s easy to get confused between a personal virtual
assistant and a virtual customer assistant. A personal
Actually, sorry. I meant 4 oranges. virtual assistant is an application for personal use,
such as smart speakers or a virtual assistant on
You got it. I’ve added 4 oranges and
4 apples to your list. What else would you like?
your cell phone. You probably use this type of
Conversational AI application at least once, if not
No, that's wrong. I DON'T want apples. multiple times, throughout the day. Virtual personal
assistants—including Amazon Alexa, Apple’s Siri, and
Got it. You have 4 oranges and 4 apples Google Home—use ASR and NLP, but have simple
in your list. What else would you like?
dialog management. Learn more about virtual
customer assistants on the next page.
NO! IT'S WRONG!

Got it. You have 4 oranges and 4 apples

in your list. What else would you like?

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Virtual Customer Assistants
Virtual customer assistants, often referred to as Intelligent Virtual Assistants, are more advanced Conversational AI systems
that serve a specific purpose and therefore are more specialized in dialog management. These applications are able to carry
context from one interaction to the next which enhances the user experience.

Virtual Customer Assistants | CX

Virtual customer assistants, also known as virtual assistants or agents, are becoming increasingly popular as a way to
provide customer service conversations at scale because they offer a more conversational and natural way for consumers
to interact. Consumers are not limited to typing or speaking in a certain way or using specific words or text to solicit
responses. The result is a more effective and productive interaction that mimics a conversation with a real human and an
excellent CX.

• Provide customer service conversations at scale

• Not limited to typing or speaking in a certain way
• More effective and productive interaction that mimics conversation

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 Hello and welcome to Franklin Fruit.
How can I help you today?
Virtual Customer Assistants | Important Considerations
Virtual customer assistants can be an excellent way to offer Hello—yes. I needed to update my order.

a consistent brand experience across channels that leads to

I can help you with that.
more productive conversations with your customers. These
What is your order number?
applications can also scale across channels and easily grow
with your business to meet new and changing business 257876.
goals. They are designed to be a company’s best agent
at scale and can be customized to be brand and industry
Great. I have your order. How can I help?
specific. It is important to note that the design of, and the
process of refining and tuning the application, often varies I can't believe I ordered 4 apples. I don't like
from vendor to vendor, so it is important to work with a them. Can you remove those from my cart?
vendor who understands your needs. Yes, I can help you with that.
I have removed the 4 apples from your cart.

Great—can you tell me the new total?

Your new total is $34.67.

Is there anything else I can help you with today?

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WHICH ONE IS RIGHT FOR YOUR BUSINESS?
As you can see, there are two main types of Conversational AI applications that vary in terms of complexity and experience.
The critical difference can come down to the vendor you choose. Just like applications, vendors differ in their type and
area of expertise, scalability, and proven results. Make sure your decision-making process includes a vendor vetting process
where you ask detailed questions about experience, design, and referenceable results to ensure your application works
exactly the way you want your brand to be represented.

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About Interactions
Interactions provides Intelligent Virtual Assistants that seamlessly assimilate Conversational AI and human understanding
to enable businesses to engage with their customers in highly productive and satisfying conversations. With flexible products
and solutions designed to meet the growing demand for unified, omnichannel customer care, Interactions is delivering
unprecedented improvements in the customer experience and significant cost savings for some of the largest brands in the
world. Founded in 2004, Interactions is headquartered in Franklin, Massachusetts with additional offices worldwide.

For more information about Interactions, contact us:

866.637.9049
interactions.com 

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interactions.com