Guide to Conversational AI in 2022

AI has advanced over the years, and it is becoming increasingly valuable. Numerous businesses are investing in AI as a result.

AI is used by companies to improve customer experience, as well as employees. AI not only reduces the time it takes for customers to get help, particularly if it’s something that can be done quickly by an AI like booking changes or cancellations, but it can also save valuable time for your employees that can be used on other tasks.

In 2026, the market for conversational AI is expected to exceed 18.6 million dollars. This market is rapidly growing and over half of all companies believe that conversational artificial intelligence is disrupting industries. They also believe that their competition will implement it.

As you can see, conversational artificial intelligence is becoming an integral part of many businesses marketing strategies as well as customer service.

Conversational AI is crucial for your business. We’ll be covering the best conversational AI guides in 2022.

What is Conversational Artificial Intelligence?

Conversational AI is a more advanced version of a basic chatbot. It is used to send automated messages, and allow for conversations between computers. It can still be used as a chatbot, but it can also have more human-like conversations.

They communicate like a person by understanding sentences and replying to them in a way that mimics a human. This conversational chatbot is designed to make customers feel like they’re speaking to a real person.

This gives them a greater sense of importance and makes their experience more personal.

A chatbot works faster and can handle smaller issues that may take humans longer to fix.

Chatbots: Who made them?

ELIZA, the first chatbot ever recorded in the history computer science was made in 1994. Joseph Weizenbaum, MIT, created it. This is where the term “Chatterbox”, was born.

ELIZA recognized keywords or phrases in the input and used these keywords to send a preprogrammed response back. This meant that ELIZA didn’t respond very personally to every sentence or phrase.

For example, ELIZA might respond to your family by saying, “My father was a fisherman.”

ELIZA recognizes “father” and can provide an automatic response. So whenever the word “father”, or “dad”, is typed, ELIZA will provide the same answer.

Let me know the difference between conversational artificial intelligence and a chatbot.

It is easy to confuse conversational Ai and an average chatbot. However, there are enough distinctions to tell them apart.

Conversational AI is what makes chatbots work and virtual assistants function.

ConversationalAI uses machinelearning to help it understand what people are writing. The response can be correlated to the user’s writing.

Chatbots may be able to use conversational AI. However, there are plenty of reasons why they don’t. Basic chatbots, for example, use pre-programmed responses or are programmed using rules rather than an AI that decides what to say.

Conversational AI does not follow any rules. It responds according to the context of the user’s responses.

According to a recent study, the market for conversational AI will grow to 32 billion dollars by 2030. It’s being invested in by numerous companies, with no end.

How does conversational AI function?

Conversational AI works with a variety of structures, which can send out individual outputs depending on input.

Conversational AI uses machine learning to keep learning and increase its ability to answer or respond to more queries. This is possible because the AI can interpret the context and intention of every user’s reply to learn new questions.

Machine learning can seem straightforward at first but it is more complex than just answering questions and getting answers. It is essential to have the right AI structure .

Here are some components that make up conversational AI natural language processing.

Machine Learning (ML). Machine Learning (ML) is part of AI that uses algorithms and data to continuously improve and develop. These algorithms can learn from previous messages to humans and find out what a human’s responses are to questions and answers.

Natural Language Processing is (NLP). This method of learning language works with machine learning. It is currently being used. But, with deep learning just around the corner most conversational AI systems will move to deep learning in order to help AI better understand the language.

Analyzing Received Information. This is the section where AI analyzes and scans the text submitted by the user to find the context and intended message.

Dialogue Management. After NLP has been performed and the input has had an analysis, the AI will respond with the appropriate response. Dialogue management is the process where the AI determines the best answer to send to the user. It uses the previous processes to select the appropriate response.

Reinforcement learning: The user’s and AI’s responses are then stored. Next, machine learning analyses the input and output to see if they match. The machine learning will then be able to check if the input and output match and can learn the next similar input.

What’s conversational AI used to do?

Most people have heard of some form of conversational artificial intelligence before. However, they might not have realized that they were actually talking to AI rather than a real person. Some chatbots are easy-to-spot, while some are not.

Customer service

Conversational AI can be used in many ways. If you have ever used chatbots to contact customer service, then it is very likely that they are chatbots. Because FAQs can easily be programmed to the chatbot as answers, it’s frequently used for customer support.

IT desk service

Conversational AI can also help with basic IT queries. Chatbots can be used to assist people with simple problems and fixes rather than keeping IT professionals busy. Chatbots are able to send users to real people if the problem can’t be solved.


It can also be used for product promotion and sales. These bots are able to be set up to promote or sell products and sent to a target audience. It should be able, if properly set up, to address the person directly by their name.

These bots are able to convince users to sign up for your subscriptions or guide them through the funnel to your product page.

Data Collection

Many businesses overlook the fact that conversational AI is a way to gather data.

Your conversational AI program should have the ability to store every interaction and provide specific analytics about each day’s activities.

All calls and messages should be recorded

You can search all conversations to find out what customers are saying so that you can help them.

Find customer replies by tracking specific keywords and keywords.

You will need to collect essential data, such as call times and daily responses. Also, the outcomes of each reaction for the day.

Different industries have different examples of conversational AI

Conversational AI is used in many different industries for different purposes. Here are three examples illustrating the use of conversational AI in different industries.


SmarAction scheduling software has built-in conversational artificial intelligence that can answer queries about bookings. This is because bookings can be more complicated than simply giving a time and booking it.

This AI can understand natural language well and can handle any scheduling or request a user may have.

Watson Assistant

IBM invented Watson Assistant. Who better to create an AI conversational that can manage customers’ transactions than IBM?

This AI assistant can be used in many industries, such as fashion and healthcare.

It is able to answer basic questions, perform transactions and contact agents whenever the need arises.

Watson Assistant was found to reduce customer service time by 10% in a study.


Cognigy allows you to provide efficient customer service 24 hour a day with its conversational AI tool.

Cognigy is best utilized for customer service. It optimizes the time taken by customers to receive the required answers.

Many airlines use this software. This was especially true after Covid, when airlines had to deal a lot with customer service issues due to cancellations or refunds. Cognigy and AI can be used here to refund or reschedule customers who qualify, without the need to contact customer service representatives.

You can find more conversational AI tools in this list.


There are many uses for conversational artificial intelligence, which is why it has been slowly taking over some business sectors. While it is not a guarantee that you will never need to talk to someone in person, conversational artificial intelligence can help speed up simple tasks when people are too busy.