Artificial Intelligence

How Much Does It Cost To Develop An Ai Chatbot?

How Much Does It Cost To Develop An Ai Chatbot in India

It's clear that artificial intelligence (AI) is here to stay. Businesses are definitely taking notice of how it can optimize their processes.

Artificial intelligence chatbots might just be the next solution that leaves you wondering, “ How did I not think of that?”

So what's an AI chatbot? How does it differ from a normal chatbot? What's the cost of building an AI chatbot? How does it benefit your business? Let's see all this and more from the following sections.

What is an AI Chatbot?

What is an AI Chatbot

An AI chatbot is a computer program designed to simulate conversation with human users, especially over the internet.

They can be integrated into various platforms such as websites, mobile apps, messaging apps, and more. AI chatbots can use natural language processing (NLP) to understand and respond to user input and can be programmed to perform tasks such as answering questions, providing customer service, and helping with online transactions.

What’s the Difference Between AI Chatbots and Chatbots?

When it comes to talking about AI chatbots versus normal chatbots, specify the names in a descriptive way, such as conversational AI chatbots and rule-based chatbots.

This way, you can tell a little more about each bot just by looking at their names. Generally, chatbots are good at providing simple information or handling simple tasks; AI chatbots, however, are more intelligent and are able to answer complex questions with greater ease. When a user enters a message, a chatbot responds with a script or set of rules.

A conversational AI chatbot:

  • Natural language processing

  • Machine learning (deep learning)

  • Data collection and analysis

  • Complete responses

  • Users can type free responses

A Rule-based chatbot:

  • Commands are preprogrammed

  • No need for a large data set

  • User input is limited by the chatbot

  • Adapts only with human help

What are the Benefits of an AI Chatbot For Your Business?

What are the Benefits of an AI Chatbot For Your Business

AI chatbots have become increasingly important in today's digital landscape for several reasons:

24/7 Availability

Chatbots can operate continuously, providing customer service and support even outside of regular business hours. This can improve customer satisfaction and loyalty.


Chatbots can automate routine tasks, reducing the need for human staff and resulting in cost savings for businesses.


Chatbots can use natural language processing (NLP) and machine learning (ML) to understand and respond to customer inquiries in a personalized manner.


Chatbots can handle a high volume of customer interactions simultaneously, making it easier for businesses to scale their customer service operations.

Data collection

Chatbots can collect data on customer interactions and preferences, which can be used to improve the chatbot's performance and inform business decisions.

Increased efficiency

Chatbots are capable of automating repetitive tasks, providing quick and accurate responses to customer inquiries, and helping businesses engage their customers in a meaningful way.

What Factors Affect The Cost Of AI Chatbot Development?

AI chatbot development costs can vary widely depending on:

Functionality of the chatbot and its complexity: The more complex the chatbot's functionality, the more expensive it will be to develop. For example, a chatbot that can handle a wide range of customer inquiries and perform multiple tasks will be more expensive than a chatbot with more basic functionality.

Integrating the platform: The cost of development will also depend on where the chatbot is being integrated. For example, a chatbot integrated into a company's website will likely be less expensive than one integrated into a mobile app or a third-party platform such as Facebook Messenger.

Integrations with third parties: Integrating the chatbot with third-party services such as payment processors or CRM systems can add to the development cost.

User interface design and development: The cost of development will also depend on the design and user interface of the chatbot. A chatbot with a more sophisticated design and user interface will be more expensive to develop than one with a more basic design.

Updating and maintaining the system: It's important to consider the ongoing cost of maintenance and updates for the chatbot. As technology and customer needs change, the chatbot will need to be updated to maintain its effectiveness. This cost should be factored into the overall development budget.

Security and privacy of data are paramount: The cost of development will also depend on the data privacy and security feature that need to be implemented, as this is a critical aspect to consider when developing a chatbot.

Performing tests: The cost of testing the chatbot before it is deployed is another factor to consider. This includes both functional testing and user acceptance testing to ensure that the chatbot functions as expected and meets the needs of users.

Passing control over to humans: If chatbot is not able to handle certain inquiries, it will handover to human support. This feature will also add up to the cost.

How Can AI Chatbots Make a Difference?

By following these best practices, businesses can get the most out of building an AI chatbot, improve customer satisfaction, increase efficiency and ultimately drive revenue growth.

Establish the chatbot's goals and target audience

Before beginning development, it's imperative to have a clear understanding of the chatbot's objectives and the target audience it will be serving. This will help guide the development process and ensure that the chatbot is tailored to meet the specific needs of users.

Apply NLP (natural language processing) and machine learning (ML) techniques

NLP and ML can help the chatbot understand and respond to user input in a more natural and accurate way. This can greatly enhance the user experience and improve the chatbot's performance over time.

Mobile optimization

As more and more users access the internet on their mobile devices, it's important to optimize the chatbot for mobile devices to provide the best possible user experience.

Refine the chatbot regularly

Continuously testing and refining the chatbot can help to identify and fix issues, as well as improve its performance over time.

Connect to other systems

Integrating the chatbot with other systems such as CRM, payment processors, and back-end systems can help to improve its functionality and make it more valuable to the business.

Make use of analytics

Use analytics tools to track the performance of the chatbot. This will help to identify the areas where the chatbot excels and the areas where it needs improvement.

Getting into live chat

Your AI chatbot will occasionally be unable to answer questions, so routing it to live chat is a great idea. Offer your users the option to speak to a live representative after one or two inaccurate answers.

Building something simple

A simple chatbot that is easy to use and understand will be more effective than a complex one.

How to Develop AI Chatbot?

There are different approaches that can be followed to develop an AI chatbot. The choice of approach will depend on the specific requirements of the project, including budget, resources and the desired level of complexity.

Rule-based approach

This approach involves creating a set of rules that the chatbot follows to respond to user input. The chatbot is programmed to understand and respond to specific keywords and phrases. This approach is less complex and less expensive than other approaches, but it can be less flexible and less able to understand natural language input.

Machine learning approach

This approach involves training the chatbot on a large dataset of example conversations. The chatbot uses machine learning algorithms to learn how to understand and respond to user input. This approach is more flexible and able to understand natural language input, but it can be more complex and more expensive.

Hybrid approach

Rule-based and machine learning approaches are combined in this approach. The chatbot is programmed with a set of rules to respond to specific keywords and phrases, but it also uses machine learning to understand and respond to natural language input. This approach can provide a balance between flexibility and complexity.

Pre-built Chatbot Platforms

Many companies offer pre-built chatbot platform, that can be customized to meet the specific requirements of the business. This approach is usually less expensive, less complex and faster than developing a chatbot from scratch.

Open-source libraries

There are many open-source libraries that can be used to develop a chatbot, such as TensorFlow and NLTK. This approach is less expensive than developing a chatbot from scratch, but it can be more complex, and it requires more knowledge of programming.

How Much Does It Cost To Create An AI Chatbot?

A basic chatbot with simple functionality and design costs $5,000 to $25,000. Most chatbots like this answer frequently asked questions and provide simple information. You can integrate it into the website of a company and it has a basic design and user interface.

An intermediate chatbot with more complex functionality and design costs between $20k and $50k. In addition to handling multiple tasks and performing more advanced functions, this style of chatbot has more complex functionality. You can integrate it into mobile apps or third-party platforms like Facebook Messenger, which may have a more sophisticated design and user interface.

Chatbots with advanced features, designs, and integrations cost approximately $50,000+. This type of chatbot usually handles a wide range of customer inquiries and can do multiple things. It can be integrated into multiple platforms and third-party systems like CRMs and payment processors, and might have a pretty fancy design and interface. Besides NLP and ML, analytics will also be available.


Due to their capability to recognize and fulfill customer needs, chatbots are highly sought after. The software can be customized and is relatively flexible. In terms of chatbot development, there are many robust solutions that can be tailored to fit all of your business requirements. Several business owners have already incorporated chatbots into their operations, and the rest are interested in developing their own.

As you now know chatbot benefits, the factors affecting development costs, and of course the cost itself, you should be on your way to creating an AI chatbot for your app. The best way to develop a chatbot is to partner with an AI chatbot development company!