What is a chatbot?

A chatbot is a user-friendly interface that allows individuals to ask questions and receive responses through automated conversational exchanges.

How does a chatbot work?

A chatbot is a system designed to simulate human conversation, interacting with users through text or voice-based channels. Most people are familiar with rules-based chatbots, sometimes called toolkit chatbots. These systems operate by matching keywords and following pre-written scripts to handle simple or repetitive inquiries.

Because they rely entirely on predefined dialogue flows, rules-based chatbots require engineering teams to manually construct each interaction path. If a user asks something outside the script or phrases a question differently than expected, the bot often fails to understand or respond appropriately.

Chatbots vs. conversational AI: Why is it important to know the difference?

Chatbots and conversational AI are related, but they are not the same. Not every chatbot uses conversational AI, and conversational AI can power far more than just chatbots.

A chatbot is one application that can be built on top of conversational AI. Conversational AI is a broader technology that includes natural language processing, machine learning, and more advanced reasoning capabilities that can be applied to voice assistants, virtual agents, automated workflows, and other interactive systems.

While rules-based chatbots work only within narrow, scripted boundaries, conversational AI brings learning, adaptability, and decision-making to interactions. This enables systems that can understand context, adjust to user intent, and take meaningful action across connected tools and applications. In other words, conversational AI elevates chatbots from simple Q&A tools into intelligent assistants capable of supporting real operational workflows.

Why chatbots matter for companies

Chatbots play an important role in modern organizations by improving customer service and operational efficiency. They provide 24/7 support, ensuring that customers can receive help at any time without relying on human agents. This is especially valuable for global businesses operating across time zones.

Chatbots can also automate routine tasks such as answering FAQs, processing basic requests, or providing product and service information. By offloading repetitive work, businesses free up employees to focus on more complex and high-value tasks.

From a cost perspective, chatbots are highly scalable and far more economical than expanding support teams. They can manage large volumes of interactions simultaneously without significant additional expense, making them a practical solution for growing businesses.

For companies seeking to streamline operations, reduce support load, and enhance customer experience, chatbots serve as an effective and accessible starting point for automation.