- Conversational AI is a business problem and not an IT problem, company CEO says.
- Organisations are urged to deploy conversational AI to speed up automation and cut labour costs.
- Gartner predicts conversational AI will reduce contact centre agent labour costs by $80b in 2026.
- End-user spending within contact centres is forecast to reach $1.99b globally this year.
- The company expects to cross $100m in revenue next year.
Conversational artificial intelligence (AI) is still maturing despite its benefits to cut labour costs, beef up automation and get a higher return on investment.
Conversational AI is a process that can automate all or part of a contact centre customer interaction through both voicebots and chatbots.
Raj Koneru, CEO of Kore.ai, while speaking in an interview with TechChannel News, said natural language processing (NLP) is new for most IT organisations, in general.
“So, they have to learn how to train a chatbot to understand what the user says and they have to continuously improve the understanding capability over some time. NLP is a sort of between an art and a science and requires language contributing skills.
“This is the area where people are having problems. We are providing more tools to train their bots and manage their bots on an ongoing basis. The main reason why RoI has been low is because of immature technology and low-value implementation.”
Making agents more efficient
Kore, a privately held company headquartered in the US, is the leader in Gartner’s January Magic Quadrant, is improving its NLP insights capability and providing a lot of insights into what is working and what is not working and how to improve the NLP training.
Research firm Gartner predicts that conversational AI will reduce contact centre agent labour costs by $80 billion in 2026 while the end-user spending is expected to reach $1.99 billion this year.
Gartner projects that one in 10 agent interactions will be automated by 2026, an increase from an estimated 1.6 per cent of interactions today that are automated using AI.
“We estimate that there are approximately 17 million contact centre agents worldwide today,” Daniel O’Connell, Vice-President Analyst at Gartner, said.
However, he said that many organisations are challenged by agent staff shortages and the need to curtail labour expenses, which can represent up to 95 per cent of contact centre costs.
“Conversational AI makes agents more efficient and effective, while also improving the customer experience. Implementing conversational AI requires expensive professional resources in areas such as data analytics, knowledge graphs and natural language understanding,” he said.
Once built, he said the conversational AI capabilities must be continuously supported, updated and maintained, resulting in additional costs.
Koneru said that conversational AI is a business problem and not an IT problem.
“Businesses want to engage with their customers to answer their questions, queries or do a transaction.
If I am the head of a business unit, I want the ability to decide the conversation and create a conversation. The IT team can come in and provide the back-end integration, APIs, design of the conversation and how the conversation flows,” he said.
The first key driving factor, he said is customer adoption as they have to get comfortable with chatbots and voicebots.
“Second is being able to design a conversational AI to handle customer requests efficiently and the third is the ability to learn what is working and what is not working and improving the bot over a period of time to cater to more use cases.”
Reducing human agents
Most organisations use human agents, for both voice and chat support, he said and added that chat platforms can not only answer but also be able to complete transactions and provide information to customers.
Therefore, over time, he said that many organisations are taking most of the use cases and deploying them either on a chatbot or voicebot to reduce the number of interactions with a human agent.
“Covid has put more burden on the enterprises to support customers remotely. More volume came into their call centres or over chat as the enterprises were not prepared for that volume as there were not enough human agents to handle that volume. So, bots came helpful to handle that volume and also to increase their automation levels,” Koneru said.
In the US, he said that it has become difficult to hire human agents at lower levels and that causes a strain on contact centres.
When asked how intelligent ready-to-use chatbots are, he said that ready-to-use chatbots, out of the box, are very rare as different industries need different requirements and their use cases are also different and the back-end systems could be different.
“In certain industries such as banking and retail or healthcare, 30 per cent on the low end to 60 per cent on the high end, where the out-of-the-box concept can be deployed easily but customer support can be different.”
“Voice chatbots are scalable and they can take 100,000 conversations at the same time. Customers can instantly engage with a bot rather than waiting for a human agent. Organisations can train chatbots for new use cases very easily rather than to hire new human agents.”
Market leader
Despite the presence of big tech giants such as IBM, Oracle, Google, AWS and Microsoft in this space, how has Kore managed to stay ahead?
Koneru said that they have the broadest and deepest platform on the planet to implement voice or chatbots.
“We have installations across various industries and are already taking on the big giants for the last eight years. That is why we are the number one and have complimentary platforms to support various use cases in the experience optimisation (XO) platform,” he said.
So, he said that its secure and scalable no-code has enabled a business user to have control over that design experience and flow experience and added that no code is very valuable for businesses to quickly create that experience, deploy it and keep changing it to get an optimal outcome.
Kore supports over 40 channels, such as mobile apps, websites, messaging apps and inside an IVR, today over voice and text bots.
The company has opened its enterprise-grade XO platform to companies of all sizes, recently, to drive AI adoption.
“Before, we were selling only to large enterprises and have worked hard for the last one-and-a-half years to implement it for anybody to come and access the platform and try it without paying any money. Before the support was only for large organisations but now we offer our support for companies of any size,” he said.
Kore.ai academy
The company has also opened its Kore.ai academy, an online management system, to access its courses and self-learn for anybody.
“Considering the pace at which virtual assistants and voice bots are being deployed, most applications that a consumer or employee uses will, very soon, become conversational. Individuals looking to ride this wave of innovation and advance their career prospects should consider the XO platform for training, certifications and building innovative solutions,” Koneru said.
“We want to accelerate conversational AI’s adoption as the foundation for experience delivery across the board in all applications, even more so in the era of Metaverse and Omniverse where physical and virtual worlds will converge.”
He said that avatars in the Metaverse can engage with the real person.
“Humans can engage with another human in the Metaverse. Conversational AI can play a role in the Metaverse. The avatars need conversational AI to engage with the humans.”
However, he said that it is too early to enter that space as many companies have no major presence in the Metaverse yet as most use cases are in the gaming sector.
“It is out in the future and not right now,” he said.
Digital future
The company expects to cross $100 million in revenue next year.
“We are growing about 140 per cent year over year and aim to increase its market share over the next five years,” he said.
The company earns 70 per cent of its revenues from the US while 15-20 per cent from Europe and the rest from the Asia Pacific.
Koneru said that India and the Middle East are important markets.
“We have partnered with an Indian company – Tanla, a leading CPaaS provider, to bring our services to the UAE, Indonesia, Vietnam and Philippines. We have a team in Saudi Arabia, Qatar and the Middle East customers to engage with the customers,” he said.
Globally, Kore has 250 customers and is adding about 30 customers this quarter.
Koneru said that the Middle East is in its early days as some of the customers have implemented very basic chatbots which are not very useful.
“We are working with very large banks to implement fully conversational chatbots. Some will live this year and some next year. We are in talks with many financial, retail sectors and government entities right now and bring our technology to all of them soon,” he said.
According to ResearchAndMarkets, the global chatbot market reached a value of $ 3.7 billion in 2021 and is expected to reach $ 13.9 billion by 2027, exhibiting an annual growth rate of 24.68 per cent during 2021-2027.
Koneru believes that the digital future can blend convenience and speed with a personal and human touch and that people should be able to communicate with companies, systems and smart machines in the same way they’d talk to friends and colleagues.
Chatbots will become the primary customer service channel for roughly a quarter of organisations by 2027, according to Gartner.
However, Koneru said that organisations need to automate to reduce their costs and depend less on human agents.
Related posts:
