Conversational AI: Overview, Insights, and Uses

Customers, today, want real-time assistance whether it’s an enquiry about a product, looking for the nearest store, or addressing an issue. Read how conversational AI solves this issue

Conversational AI: Overview, Insights, and Uses

Conversational AI is an effective tool that can improve customer interactions across all touchpoints.

Customers, today, want real-time assistance whether it’s an enquiry about a product, looking for the nearest store, or addressing an issue.

A recent report found that the global conversational AI market, including chatbots and intelligent virtual assistants, is expected to grow at a CAGR of 22%, during 2020 to 2025, reaching almost US $14 billion by 2025.

With so many advancements, it goes without saying that businesses can use conversational AI to drive better targeting and conversion for their marketing and sales efforts.

But what is it exactly?

What is Conversational AI?

Conversational AI is a technology that enables computers and humans to communicate in an effective manner.

The technology usually uses speech or text recognition to ascertain the users’ intent and respond with an adaptive automated script.

It has made major advances in many industries. It helps deliver personalized conversations at scale across multiple channels in real-time.

Whether a customer is approaching your business via messaging apps or live chats they will experience a highly personalized interaction throughout their buying journeys.

Conversational AI solutions can help you analyze and understand the buyer’s profile, preferences, tastes and send relevant content and assistance that’s catered to their needs. This can ultimately drive conversion and create meaningful interactions.

Difference between Conversational AI and a Chatbot

Although chatbots and conversational AI are often used interchangeably to mean the same thing, there are significant differences that are worth mentioning. A chatbot can be powered with a conversational AI but vice versa is never the case. Some of the distinctions between the two are as follows:

Difference between conversational AI and chatbots

Read also: Conversational Commerce: Use cases and examples

How does Conversational AI work?

It is important to understand how conversational AI works in order to use it effectively.

How does conversational AI work?

This diagram depicts how AI uses an input from an user to deliver relevant output.

Components of Conversational AI
Components of Conversational AI


Conversational AI Statistics


1. 74% of consumers like to interact with AI chatbots when they need quick answers to queries.

2. 67% of millennials in the USA accepted they are expecting  to buy products and services with AI chatbots

3. 58% of companies that use chatbots are B2B

4. Chatbots handle 68.9% of chats from start to finish

5. 41.3% of consumers use conversational marketing tools for purchases

6. 33% of consumers would like to use chatbots for reservations

7. Chatbot e-commerce transactions are predicted to amount to $112 billion by 2023

8. Using abandoned cart alerts via messenger boosted e-commerce revenue by 7-25%

9. 55% of businesses use chatbots to generate high-quality leads

Conversational AI in Ecommerce


Reports suggest that almost 60% of e-commerce shoppers will leave a site if they can’t find what they are looking for.

Adoption of AI is on the rise and ecommerce businesses are starting to leverage it to reduce acquisition costs, improve landing page conversion rates, increase AOV, drive repeat purchases, and more.

Conversational AI is proving to be useful in every part of the buyer’s journey. Some of the use cases can include:

Product Recommendations

Product recommendations using conversational AI

Use AI to send product recommendations without requiring human intervention. For instance, a customer enquires about a shoe on one of your social channels. While conversing, the AI can send complementing recommendations such as dresses or pants that may look good with the shoe.

The AI can also send recommendations based on the customer’s purchase history. This can ultimately increase your AOV and sales. Conversational AI solutions like Vizury can help you drive such conversations across channels and personalize your customer’s experience.


Cart Abandonment Alerts

Abandoned cart alerts using conversational AI

Send targeted alerts to high-value shoppers who abandon their carts by sending them personalized messages across channels. For instance, Mary just abandoned a red shoe in her cart.

You can send a personalized message incentivizing her to complete her purchase by saying “ Hey Mary, looks like you’ve forgotten the red shoe in your cart. Would you like to view your options to complete your purchase?”

Upon conversing, you can send a 10% discount to incentivize her to complete the purchase.

Personalized Offers


Personalized offers using conversational AI

Send personalized offers and discounts by segmenting your customers based on their intent, purchase history, preferences, and more.

For instance, using conversational AI solutions can segment your frequent customers and offer them discount coupons. This can help drive repeat purchases and more conversions.

Feedback Reports


Feedback reports using conversational AI

Keep a track of how your business is performing by rolling out a survey to your customers and collecting feedback.

For instance, you can send a message saying, "Hey John, we are glad you shopped with us. Rate your shopping experience with us on a scale of 1 to 5.”

Read also: Why should you invest in conversational AI for Google Business Messages?

The New Age of AI

Customers, today, demand an exclusive and highly personalized shopping experience. With customers becoming comfortable with AI-based interactions, having greater conversational automation is gradually becoming the new normal.

Hence, adopting Conversational AI solutions can help transform your customer’s experience to the next level. It’s time to leverage this powerful tool to enhance your marketing and sales efforts.

Can AI based personalization solve the rising consumer expectations?

Zalora Case Study: A guide to real time user journey mapping

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