Conversational AI will change the way people communicate with technology by making communication between humans and machines more natural and effective. This is considered superior technology that underpins the majority of chatbots and virtual assistants. At the heart of all, conversational AI bundles several different, separately sophisticated technologies to mimic human-like conversation. Fundamental to this technology is Natural Language Understanding, which allows machines to understand and interpret human language. NLP refers to the parsing and analysis of language with the intent of gaining an understanding of its meaning, context, and intent. This process begins once an AI system receives an input in written or spoken format provided by a user. Then, it further breaks down into minor components, such as words and phrases, to clarify the intent and structure of the input.