What is an AI Chatbot? Here's Everything You Need to Know

Artificial intelligence (AI) is here for the long haul and is making leaps and bounds in how it can optimize business processes.

You never know, AI chatbots could be the next solution to make you go, “Wow, why didn’t I think of using this sooner!?”

But what is an AI Chatbot? Is it the same thing as the average chatbot?

Here's what we cover:

Your AI glossary
What is an AI Chatbot?
AI Chatbot benefits
Types of AI chatbots and their use cases

AI chatbot, conversational AI, generative AI, ChatGPT... What are they all about?

The world of Artificial Intelligence (AI) has given birth to endless terms and technologies and it can be sometimes very difficult to distinguish between all of them.

You must have heard of some or even all of these, but to help you become a native in this field, here's a quick glossary to help you navigate yourself in the right direction:

🤖 Conversational AI

This is the all-inclusive concept summarising all different kinds of AI technologies that allow smooth communication between humans and machines.

So really, conversational AI is the umbrella term that goes beyond chatbots and includes voice assistants, virtual agents, and interfaces.

🤖 Generative AI

Generative artificial intelligence in turn is more specifically about the technology itself designed to create content, such as text, images, and music. These AI language models are trained on extensive datasets and learn patterns and structures to generate new, original content.

ChatGPT, the tool we all know and love (or hate...), is just one specific use case of generative AI created by OpenAI, that is focused on text generation.

what is an ai chatbot?

🤖 AI Chatbots

AI chatbots, which we'll dive a bit deeper into in this post, are the specific software programs that simulate human-like conversation through text or speech.

These bots differ from regular chatbots in that they use AI algorithms to understand the different user queries and respond appropriately.

Their goal is essentially to offer information, and assistance, or engage in natural conversation. For example, many businesses enjoy the benefits of their enterprise chatbots in their daily operations. 

This is why they are often used in customer service and support systems across industries to automate tasks, provide guidance, or entertain users.

Another term that is often also heard in passing is rule-based chatbots. Want to learn the difference? Check out our post on AI chatbots vs rule-based chatbots.

Altogether these concepts, ranging from broad ones like Conversational AI down to specific implementations like ChatGPT, are all about enhancing interactions between humans and machines.

Although they're all very fascinating and we could talk a lot more about each of them, as mentioned in the title, the one we're focusing on here is the AI chatbot.

What is an AI chatbot?

To set the foundation for understanding AI chatbots even better, you should know that all AI chatbots are indeed chatbots but not all chatbots are AI chatbots.

As mentioned, AI chatbots are software programs that understand spoken or written human language based on Natural Language Processing (NLP) capabilities.

This means that an AI chatbot can detect the intent of a query that a user types in and deliver the best response it deems fit.

With the help of machine learning, this AI technology can mimic human-like traits by being a problem solver, thinking creatively, and reasoning independently.

For example, voice cloning can enhance the user experience, making interactions with chatbots more natural and engaging, as they can not only understand text but also generate human-like speech.

And the more interaction they're exposed to, the more they reflect and improve themselves to tackle bigger puzzles.

What are the benefits of AI chatbots?

✅ Efficient customer service

One of the main benefits businesses love about AI chatbots is that it makes answering customer queries more efficient. Diligent and personal service doesn’t always have to require human support.

chatbot statistics

✅ Gather and learn from customer data

By taking advantage of the previous live chat history that has taken place on your website, AI bots can learn and respond based on real conversations that you’ve had with customers in the past.

When you train your AI chatbots based on customer conversation history, your bots are also becoming more accurate. Evidence of patterns in previous conversations is a good indicator of what answers customers are frequently seeking.

✅ 24/7 support

Another benefit of AI chatbots is that they are available 24/7 and respond to customers instantly. You can provide personalized responses around the clock, even in multiple languages in some cases.

And after the initial data is collected, AI chatbots require low manual maintenance.

But how do you make sure you set your chatbot up for success?

For that, you need to make sure you're following the chatbot's best practices and optimizing your bots as you go. 

Types of AI chatbots and their use cases

As we've seen here, AI chatbots come in various types, but they also have their own use cases.

One popular type is the conversational AI chatbot, which uses AI models like GPT-4 to generate text and engage in real-time conversations. These chatbots are commonly used in customer service to provide quick and efficient responses to customer queries.

Another type of AI chatbot is the marketing automation chatbot, which uses templates and workflow automation to streamline the marketing process. These chatbots can prompt users to take specific actions or provide personalized recommendations based on user input.

ai chatbot use case

Some businesses opt for custom AI chatbots that are tailored to their specific needs.

These chatbots may have advanced AI features and capabilities, such as the ability to use natural language processing (NLP) to understand complex conversations and provide more personalized responses. They are often used as virtual assistants to help users steer complex tasks or processes.

Overall, AI chatbots are versatile tools that can be used in a wide range of industries and use cases, from customer service to marketing automation.


AI Chatbot FAQs

What is an AI chatbot?

An AI chatbot is an online program that can simulate human-like customer interactions on mobile apps and websites through the use of NLP and Machine Learning.

They are designed to understand a user’s intent, preferences, and needs without the involvement of a human operator.

What is an AI chatbot used for?

AI chatbots have many advantages and uses in different aspects of a business. You can use AI chatbots to:

  • Identify qualified leads
  • Collect user data and build email lists
  • Provide exceptional customer service
  • Upsell and cross-sell your products and services
  • Automate repetitive tasks

In a nutshell, you can transform your operations by using an AI chatbot to improve your efficiency and provide better customer experiences.

How to build an AI chatbot?

Building the best AI chatbot for your business is easier than ever with the help of a chatbot builder.

While there are many platforms available out there, you should ensure that you are clear on your preferences and needs.

Next, compare different AI chatbot platforms based on their user-friendliness, integrations, reporting capabilities, and other factors mentioned above.

If you are looking for rich capabilities at a nominal rate, consider opting for giosg. It has a user-friendly interface and comes with tons of features that make the process of building an AI chatbot hassle-free, specifically designed for enterprises.

Which features should I look for in AI chatbots?

While picking a chatbot builder for your business, here are some of the factors that you should compare in different platforms:

  • Accuracy
  • Automation grade
  • User-friendliness
  • Targeting options
  • Integrations
  • Branding options
  • Chat routing
  • A/B testing feature
  • Reporting and analytics capabilities
  • Customer support

This is just a quick overview. Read more about how to choose the best software for you!

Want to learn more about AI chatbots?

Still want to learn more about AI chatbots and also the best platforms to create your own? Head to our blog post 20 Best AI Chatbot Platforms to get even more inside information on conversational AI!