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Today, we are heading to a digital world where everything has become online and present 24/7, be it exploring and buying products or interacting with a brand. Everything now is connected to the internet. And in this context, Artificial Intelligence is playing a significant role, making technological change across industries, especially in businesses that leverage the technology to deliver customer service functions.

Thus, to deliver effective, 24/7 customer services, almost every business nowadays is making use of chatbots, an AI-driven software that conducts a conversation through auditory or textual methods. Though chatbots have been around for decades now, the idea of a virtual agent that can seamlessly interact with customers, provide germane information, and even complete basic functions like booking an appointment or scheduling a call-back are relatively new.

On top of that, there seems to be a general mystification surrounding the difference between chatbots and virtual agents.

Chatbots

A chatbot typically is a piece of software that interacts either by text, on website chats or over emails or SMS, or audibly, like with Alexa or Siri. The first chatbot saw in the 1960s, which was built by MIT professor. Since then, the functionality of chatbots has improved over the years, but they are still built with simple, rules-based technology, leaving them limited to matching the questions they receive with the most probable, predefined answers.

Chatbots are usually used in dialog systems for diverse practical purposes including customer service or information acquisition. Some use sophisticated natural language processing systems. But many simpler ones that scan for keywords within the input, then drag a reply with the most matching keywords, or the most similar wording pattern, from a database.

Chatbots’ limitation to matching the questions makes them incompatible to represent an organization with high volumes of customer service chat traffic since human language is far too intricate and nuanced to be narrowed down to a predefined selection of questions and answers.

Virtual Agents

Virtual agents are more advanced than chatbots and are not powered by the same rules-based programming. They can perform more as they have more skills. With recent advancements in AI and cognitive computing, virtual agents have become more popular and designed to both accurately imitate human conversations and comprehend the underlying context, content and intent of a customers’ request.

Virtual agents can be programmed to act many of the same things that a human IT agent would do during a customer service interaction. They can courteously ask questions and retort, verifying what users want before performing a service, and even consulting the organization's knowledge base or service catalog for additional information. Today, these virtual agents can even consult a human agent behind the scenes when required, ensuring a seamless customer experience for users while capitalizing on automated service delivery.

Thus, chatbots and virtual agents are similar in that they interact with customers to deliver customer service. But the major tipping point that is making them different is the technologies underlying these applications and how that interprets into capabilities that can benefit the customer. Chatbots and virtual agents may be similar in their programming, but the way that they function is reliant on the context.