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Home - VoIP Service - Demystifying Conversational IVR: How Does it Work?
Reviewed by : Prasanta Raut
To best serve your customers, you should combine automation and human interaction. Conversational IVR, or Interactive Voice Response, enhances communication whenever a client and a business phone system make a phone call.
Customers can talk with the following system without having to press menus or buttons. Conversational IVR then leverages artificial intelligence (AI) and natural language processing (NLP) to accurately determine their wants and needs.
Today, we’ll be understanding how does conversational IVR work along with its benefits, components, and so much more. So, without any further delay, let’s get started!
Table of Content
Conversational IVR is a phone system that uses a conversational AI platform to give agents intelligent routing and customer self-service capabilities.
Conversational IVR interacts with callers using natural language, unlike traditional IVR systems that use Dual-tone-multi-frequency (DTMF). Callers may communicate in both directions with the same ease and effectiveness since they can describe their problems the same way they would with human agents.
Natural language IVR uses conversational AI technology to ask callers for the necessary information. Then, the IVR can respond appropriately, ask for further details, or transfer the caller to a live person if needed.
Conversational IVRs maintain the option available in the event of complicated queries, even though their main goal is to remove the need for customers to speak with an agent.
Essentially, an automated phone receptionist is called the traditional IVR (which means Interactive Voice Response).
This setup allows you to speak to a company by dialing their number and following an automated voice that allows you to select from various choices via a pre-recorded list of options. Feedback is achieved by pressing the keys on the keypad of the telephone set.
A recorded message from the Interactive Voice Response (IVR) system presents a list of 1 through 9 choices. From there, you use your phone keypad to pick the option that suits your needs.
Lastly, the system plays another recording with instructions or information according to your choice. This is how the traditional IVR system works.
Some of the common uses of traditional IVR systems are as follows:
Though they were helpful initially, traditional IVR systems became frustrating because of their limitations. This led to the creation of Conversational IVR, another step taken after the previous generations of IVR technology. Learn how conversational IVR has developed:
The Early Stage (1930s-2000s)
1930s: The first ground was unmatched with the invention of the Voder Machine by Bell Labs; it could synthesize human speech.
1960s: It enabled callers to interact with Interactive Voice Response (IVR) systems using their telephone keypad.
1970s-80s: Although IVR systems became widely spread, they had less functionality.
1990s & 2000s: The improvement of computers and the integration of call centers and CTI made IVRs more dependable and competent.
The Growth of Conversational IVR (2010s-Present)
2010s: The enhancement was channeled towards better call handling using dynamic menus and real-time data integration, enhancing the contact centers experience.
2020s (Present): Conversational IVR is currently having a glorious season. Much is now possible due to AI (Artificial Intelligence) and NLP (Natural Language Processing) technological breakthroughs like:
The Future of Conversational IVR
The days are not so far off when we will see the emergence of much more sophisticated Conversational IVR with such features:
Conversational IVR can be defined as an extended version of traditional IVR. It utilizes artificial intelligence (AI) to identify patterns and respond in natural language. Here are some of its components:
This technology changes information expressed vocally by a caller into digital text that the system can recognize. Precision is necessary for making user interaction smoother.
This AI is not limited to speech recognition only; it also takes into account the caller’s intention when using the words, as seen in the example below.
When a client says, “My laptop is not working,” NLU realizes that the person needs help with technical issues rather than a general comment about politics.
If the system catches the meaning, the NLG processes the genuine response and addresses the caller’s needs. Therefore, such interaction is more human-like than pre-recorded prompts.
Artificial intelligence (AI) utilizes comprehensive data to enhance IVR conversation quality. It also helps in increasing the system’s ability to comprehend natural languages and respond to them.
Interactive voice response systems can incorporate current databases and CRM systems and get customer data to personalize interactions. This way, the system can provide more related content along with carrying out operations such as checking balances, for example.
Conversational IVR uses sophisticated conversational AI to process and respond to consumer voice instructions in real time. The goal is to use spoken responses, language, intent, context, and sentiment to provide a tailored customer satisfaction and customer experience(CX).
Here’s a summary of how it works:
First and foremost, the cell phone microphone detects your voice and converts it into digital form, which AI later analyzes. The AI then works to ensure smooth interaction by translating it into text correctly.
This machine is more than words. It reads texts and interprets them to understand what you mean when asking questions or making requests.
The working mechanism can also be understood in a step-by-step process that goes like this:
There are tons of benefits of Conversational IVR, let’s discuss them in detail:
Conversational IVR is way better than the old push-button systems. However, it has its own set of challenges and considerations. Here are some of them:
And that’s a wrap! In this article, we briefly explained what conversational IVR is and how it works. We hope you like it.
Conversational IVR is helpful for systematizing customer interactions. However, for it to be effective, it must overcome challenges such as managing costs and understanding complex requests.
The primary priority should be a strong understanding of natural language and the option to connect with live agents. This ensures a customer experience that is both smooth and positive with conversational IVR.
Conventional IVR mechanisms usually use recorded messages and a few choices. However, spontaneous IVR systems use AI to understand and respond to standard language questions, allowing for more intuitive and tailored interactions.
Conversational IVR can be a function of the qualitative nature of the training data, the way the AI algorithms are formed, and ongoing efforts to tune and optimize them. However, while much progress has been made in the last couple of years, they may struggle with complex or non-directive questions.
Yes, such conversational IVR systems could be designed with robust security measures to protect critical customer information. This may include measures such as encryption, authentication, and compliance with data privacy regulations like GDPR and HIPAA.
Prasanta is the founder and visionary CEO of Dialaxy. He is on a mission to redefine the landscape of SaaS solutions, infusing creativity and ingenuity into every aspect of Dialaxy’s offerings. His fervent dedication to simplifying sales and support processes drives Dialaxy’s forward momentum, delivering unparalleled value to businesses of all sizes. Embark on a transformative journey with Prasanta and Dialaxy as they pave the way for a new era of sales and support excellence.
Prasanta Raut