Conversational AI
Jul 27, 2021
7 MIN READ

What is Conversational AI?

Conversational AI is a combination of key voice technologies that enable digital voice assistants to understand natural human speech and respond in kind. Unlike robotic command and control voice interfaces, conversational voice assistants are built using a combination of Automatic Speech Recognition (ASR) and Natural Language Understanding (NLU) technologies to create Speech-to-Meaning® understanding. 

Conversational AI is a combination of key voice technologies that enable digital voice assistants to understand natural human speech and respond in kind.

These natural-sounding voice interfaces are also context-aware—allowing them to remember previous parts of the conversation and eliminating the need for users to repeat key information over and over. Large content domain libraries equip conversational voice assistants with the knowledge they need to respond to natural speech accurately. Multilingual capabilities allow brands to deploy them for users across the globe.

Voice-enabled mobile apps, vehicles, websites, contact centers, kiosks, customer support centers, and phone ordering systems are already creating positive customer interactions and decreasing operational costs. Consumers are increasingly expecting fast, convenient, and hands-free interactions at home, over the phone, and in-store, and companies are realizing the benefits of reduced wait times, personalized voice experiences, greater hygiene, and consistent brand experiences. For most brands, conversational technology has evolved from a nice-to-have to a necessary technology in order to meet customer’s demands and remain competitive.

Large content domain libraries equip conversational voice assistants with the knowledge they need to respond to natural speech accurately.

While companies in many industries are implementing voice assistants and chatbots to improve customer experiences, reduce operational costs, and provide greater accessibility, not all of these voice user interfaces are conversational. Many voice assistants still rely on their users understanding a set script and a limited library of content knowledge to deliver on narrow use cases. In the future, consumers may abandon these limited voice assistants in favor of those who can deliver fast, accurate responses to users who can get the information or the product function they want by asking for it as they would another human.

Conversational AI in industries

Conversational voice assistants are already breaking down the barriers between humans and machines in a few industries—replacing the robotic voice user interfaces of the past. We’ll take a deeper dive into the shift to conversational AI and the benefits for users and brands in four key markets:

  • Banking
  • Customer service
  • Retail
  • Fast-casual restaurants

Banking is branching out into conversational AI

As institutions built on customer service, banks and financial institutions have adopted conversational voice assistants for their voice-enabled mobile apps and contact centers. These service-oriented organizations are continuing to look for more ways to creatively use conversational AI to enhance, innovate, and improve their customer service strategies. In fact, 90% of business leaders in the financial industry indicated that convenience and speed for end users was the biggest driver of value from their voice assistant, according to Opus Research.

90% of business leaders in the financial industry indicated that convenience and speed for end users was the biggest driver of value from their voice assistant.

Opus Research

Conversational AI is the future of banking, with voice-enabled mobile apps creating a superior customer experience through faster search and easier transactions, all hands-free. With the help of a voice assistant, tasks, such as looking up a routing number, transferring money, and paying bills, can be performed in seconds, giving back valuable time to the user and making it as natural as interacting with a human bank teller. These interactions are made more human and personalized when the voice assistant can understand natural language and not rely on a set menu of queries and responses.

Many of the calls to banking contact centers are routine, such as checking a balance, paying a bill, ordering checks, activating a debit or credit card, and transferring money. These tasks can be easily addressed with a voice AI solution, freeing up customer service agents to address questions that require human expertise. Conversational AI solutions for banks also reduce customer frustration and wait times by avoiding lengthy, complex menus and being able to address questions quickly, accurately, and naturally.

Customer service is calling for conversational AI

Customer service contact centers have had IVR systems for decades, often leading to frustrated customers faced with lengthy and complicated menu options that may or may not help them resolve their issues. IVR limitations are only one of many call center challenges, which include timely responses to common questions and routine transactions, long hold times for issue resolution, the need to transfer callers to other agents, and timely record-keeping. These obstacles continue to plague contact centers and prevent them from meeting their goal of providing superior customer experiences.

In addition, the recent pandemic has added long wait times to the list of challenges faced by contact centers, and conversational AI has helped with increased call volume and other concerns. Conversational voice assistants in call centers alleviate the friction and frustration felt by most customers by answering common queries, dealing with routine transactions, and keeping records, thereby decreasing wait time and alleviating pressure on call center agents.

Voice assistants in call centers alleviate friction and frustration by answering common queries, dealing with routine transactions, and keeping records.

Instead of a complex menu, customers are simply greeted with a “How may I help you today?”, where they can then respond conversationally and naturally rather than debating which number best represents their question or repeatedly pressing zero to speak to a human. 

Telecom uses voice assistants in contact centers for a variety of reasons, including:

  • Personalized experiences
  • Natural interactions
  • Reduced operational costs
  • Enhanced security
  • Omnichannel experiences

Rather than asking callers to repeat identifying information through the call, voice assistants can make interactions more personal and efficient by recognizing the phone number of the caller and associating it with the name and profile on record. Through advancements in speech technology, such as Natural Language Understanding (NLU) and Automatic Speech Recognition (ASR), voice AI is also able to understand complex queries and compound questions, providing a superior customer experience.

Conversational voice AI can also decrease wait times and increase resolution rates by handling queries that don’t require a human operator, allowing contact center employees to spend their time on calls that require human ingenuity. By incorporating voice assistants across channels, telecom companies will be able to achieve the consistent brand experiences they seek.

Retail is buying into voice AI

Customers looking for faster, more convenient, and personalized shopping experiences are already using voice-enabled mobile apps and websites to complete their retail transitions. Businesses in the retail space are adopting conversational AI to provide greater choice and filtering capabilities in the competitive e-commerce space and are looking for ways to include voice-enabled kiosks and other voice experiences for better in-store convenience and efficiency.

Mastercard’s voice-first experience for retail—their “Shop Anywhere” voice solution, powered by Houndify—is a great example of conversational AI for retail. The “Shop Anywhere” voice solution allows for personalized shopping experiences, no wait or checkout lines, secure payments, and access to stores outside normal operating hours. 

Voice-enabling kiosks are a natural evolution for many in the retail industry who are already using interactive kiosks for a variety of customer service purposes, such as price checking. With voice-enabled kiosks, customers can get their questions answered anytime without having to hunt for a sales associate, stand in long lines, or wait while the correct person is located to get the answers to otherwise simple questions. 

Voice-enabled mobile apps and websites are natural additions to e-commerce experiences, affording customers faster, more accurate search, superior filtering functionalities, and exceptional customer service. Voice search allows customers to more easily find the exact product they’re looking for without getting lost in a sea of unrelated suggestions and buried products. Available 24/7, voice-enabled customer centers on websites deliver real-time responses and the convenience for customers to get the answers they need and make purchases anytime and anywhere.

Voice search allows customers to more easily find the exact product they’re looking for without getting lost in a sea of unrelated suggestions and buried products.

Fast-casual restaurants are serving up voice assistants

Fast-casual restaurants use conversational AI in voice-enabled kiosks and also through phone ordering services. The reasons why QSRs use conversational AI include:

  • Conversational interfaces
  • Personalized voice experiences
  • Greater hygiene
  • Faster, more convenient customer service
  • More accurate ordering
  • Reduced operational costs
  • Increased sales through upselling
  • Consistent brand experiences 

Voice-enabled kiosks for QSRs began to grow in popularity in the early 2000s and are now the norm for many fast-casual restaurants. They eliminate long lines, increase hygiene, and offer fast, accurate, and convenient ordering experiences.

Voice-enabled kiosks eliminate long lines, increase hygiene, and offer fast, accurate, and convenient ordering experiences.

Using voice-enabled kiosks, customers no longer need to navigate complex menus and can simply ask for what they want by speaking naturally. In addition, voice-enabled kiosks take the burden off of employees and free them up for more important tasks, such as ensuring that each meal adheres to the brand’s quality standards. 

With conversational AI for phone ordering, customers’ phone calls are answered promptly and recorded accurately, which reduces customer frustration and operational inefficiencies. A conversational voice assistant also allows customers to ask for what they want by speaking as they would to another human—even without knowing exactly what items are called or where to find them in a menu.

Interested in learning more about voice AI phone ordering solutions? Check out our demo, Houndify’s Voice AI-Powered Restaurant Phone Ordering Solution.

Conversational AI benefits banking, customer service, retail, and fast-casual restaurants through fast, convenient, hands-free interactions. Banks and financial institutions use conversational AI in their voice-enabled mobile apps and contact centers to enhance, innovate, and improve their customer service strategies. Contact centers are evolving from ineffective legacy IVR systems to conversational AI solutions where customers can get their issues resolved by speaking naturally.

Retail companies can employ conversational voice-enabled mobile apps, websites, and kiosks to offer quicker, personalized shopping experiences. Fast-casual restaurants can use voice-enabled kiosks and conversational AI phone ordering solutions to eliminate long lines, increase hygiene, and offer fast, accurate, and convenient ordering experiences. Companies currently not using conversational AI to improve their customer experiences should consider the benefits before they lag behind competitors who have already engaged in conversational with their customers.

At SoundHound Inc., we have all the tools and expertise needed to create custom voice assistants and a consistent brand voice. Explore Houndify’s independent voice AI platform at Houndify.com and register for a free account. Want to learn more? Talk to us about how we can help bring your voice strategy to life.

Kristen is a content writer with a passion for storytelling and marketing. When she’s not writing, she’s hiking, reading, and spending time with her nieces and nephew.

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