Chatbot Overview

What is a Chatbot?

A Chatbot is information service interface done by a computer program, sometimes with the help of artificial intelligence (AI). Chatbot applications range from functional to fun, and have been growing quickly both in sophistication and popularity.

Where to use Chatbots?

Chatbot-based applications have already impacted a variety of industries:

Restaurant Bot: Make reservations and coordinate food deliveries

Travel Bot: Select itinerary and answer questions about the trip/destination

News Bot: Filter and feed items of interest to the User

The Chatbot is becoming a major application across multiple industries and use cases, and many global brands are heavily invested in Chatbot technology.

Why Chatbots can fall below users’ expectations?

Although Chatbots are now widely used, their core technologies are still in the early stage of application and some Chatbots fail to meet Users’ expectations. Reasons for unfavourable user experience can be categorized:

Lack of a strong business use case, i.e. no user demand for a particular Chatbot

Apps or websites are more effective than a Chatbot for the target task

Too many similar products

The Chatbot has poor natural language processing capability

The Chatbot is not well designed or implemented

Building a Successful Chatbot

Key Questions to Answer

Why a Chatbot?

What can users do with your Chatbot?

How to manage user expectations?

Intelligence level vs build cost?

Why a Chatbot?

The Chatbot is not a universal solution for every user interaction interface. To build a successful Chatbot, the first step is to consider “Why a Chatbot?” This consideration should include conversion friction, usability, ability to get the job done, efficiency, and ecosystem maturity. By exploring these considerations you will able to decide whether to use a Chatbot or Native App for your core business solution. The chart below compares Chatbot, Native App, and Mobile Webpage interfaces.

What can users do with your Chatbot?

You will need to think from the user’s point of view. The Chatbot follows different design principals to provide effective service in various use cases. For example, a banking assistant type would have an advanced banking FAQ database to deliver smart responses, while a shopping assistant type would have an enhanced short memory function, allowing the user to retrieve previous information.

How to manage user expectations?

User expectations of a Chatbot can be understood from the point of view of scale, convenience, engagement, personalization, and natural interaction.

Scale : The number of user conversations the Chatbot service can conduct simultaneously.

: The number of user conversations the Chatbot service can conduct simultaneously. Convenience : The different functions the Chatbot can perform.

: The different functions the Chatbot can perform. Engagement : The ability to retain user attention.

: The ability to retain user attention. Personalization : The Chatbot’s ability to adapt over time and customize dialogues.

: The Chatbot’s ability to adapt over time and customize dialogues. Natural Interaction: The similarity to natural human interaction.

What are the intelligence and cost requirements?

The level of intelligence and cost totally depend on your core business objective. You can evaluate this through industry vertical, level of interaction and complexity factors.

Industry vertical: The level of intelligence and cost can depend on the industry you’re building the Chatbot for. Compliance with Healthcare and Financial Services policies and standards for example can add to the costs of building a Chatbot for these sectors.

Level of interactivity: The level of interaction will impact the intelligence and technology levels of your final product, and, correspondingly, cost. Chatbots with advanced natural language processing are more humanlike, but such cutting edging technologies push up cost.

Complexity: The functional complexity of a Chatbot that needs to integrate with back-end systems will also increase the level of intelligence and, correspondingly, cost.

Beyond these three main variables, you should also look at factors such as number of platforms, technical infrastructure and custom integrations. A standard Chatbot will almost always be much cheaper than a customized Chatbot.

Conclusion

Nowadays it’s hard to deny the great capabilities that Chatbots are bringing to our daily lives, and the many possibilities they hold for the future. Answering the above four questions will help you identify whether an existing third-party Chatbot aligns with your needs, or set the scope for developing your own. Then you will be ready to take the next step to building a successful Chatbot.

Analyst: Guorui Su | Editor: Robert Tian、Michael Sarazen、Meghan Han

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