The Global Chatbot Market was valued at USD 3.2 Bn in 2020 and is expected to reach USD 14.9 Bn by 2027, with a growing CAGR of 24.60% during the forecast period.
The chatbot is a software application that is used to provide direct online chat conversation via text or text-to-speech 24/7. Nowadays, chatbots are developed with Artificial Intelligence (AI) technology and Machine Learning algorithms to stimulate a conversation in a natural language with the user through messaging applications, websites, and mobile apps.
Several of the companies are aimed to incorporate Natural Language Processing (NLP) in their chatbot models. For instance, Yellow.ai, a conversational AI platform provider company, announced a plan to raise around USD 78.1 million to expand its AI-based chatbot platform with Natural Language Processing (NLP) across the globe.
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The chatbot market is gaining tremendous traction owing to the huge adoption of customer service activities by medium and large-sized enterprises to reduce operating costs. For instance, according to Tech Times report 2021, a company’s call center costs can be reduced upto 40% with the usage of conversational AI-based platforms. The increased integration of chatbots is also estimated to improve agent productivity scores.
As the growing preference from individuals is observed towards messaging applications over social networking sites, the Over-the-Top (OTT) messaging applications, such as Facebook Messenger, WhatsApp, and WeChat among others are anticipated to experience increased demand for chatbot in the forecast period.
The Global Chatbot Market Segmentation:
Company Profiles and Competitive Intelligence
The key players operating in the Chatbot market are:
Based on platform, the standalone segment is holding the highest market growth
The standalone segment was accounted to dominate the global chatbot market with a revenue share of 56.9% in 2020. The dominance is expected to continue throughout the forecast period owing to the upsurge in the usage of artificial intelligence–powered virtual assistants such as Google Assistant, Amazon’s Alexa, and Apple’s Siri to use in standalone messaging platforms. Apart from this, several other enterprises prefer chatbots for messaging platforms and customer service bots for web-based services to increase customer interactions and customer engagements. Moreover, the integration of chatbots in varied industries such as in healthcare domains are used to increase awareness about certain things like cancer, diabetes, etc. For instance in May 2021, Sri Ramakrishna Institute of Oncology and Research (SRIOR), Coimbatore has released a WhatsApp chatbot to raise awareness about cancer, side effects of tobacco use and COVID 19 amongst people.
Based on the organization size, the large enterprise's segment accounted for a 46.0% share in the market
The large enterprise has been accounted for over 46.0% of market shares and is estimated to be dominating the chatbot market in the forecast period. Large enterprises have a comparatively huge customer base and it is impossible to address all the queries from the customers in one go. Thus, there is a huge adoption of chatbots experienced by large enterprises, however, large enterprises are expected to optimize their chatbots in the future to experience advanced operations.
For instance, in August 2021, Connected Insurance (CI) has partnered with Swiss Re to launch its first-ever cyber protection embedded for the digital-savvy consumers named ‘The Digital-Life Insurance.’
Based on regions, the chatbot market in North America has accounted the largest share in 2020
The North American market has come up as a prominent hub for start-ups in the chatbot market. The chatbot market has accounted for the largest share with 40.4% of the market size in the year 2020 followed by the Asia Pacific, which is a major hub for the services industry. The regional growth is majorly attributed to the increased adoption of chatbots by large and mid-large organizations which ultimately benefits it with reduced operating costs, improved customer satisfaction, and enhanced operating efficiency.
Moreover, the region is very well developed when it comes to technological infrastructure, and thus the prominent market players of the chatbot market present in the region are aimed to develop their chatbot platforms for varied industries.
For instance, in July 2021, DealerAI, a Canada-based digital conversation technology company, introduced their proactive AI chatbot solution exclusively for the automotive industry that caters to dealerships and consumers.
The report also provides an in-depth analysis of chatbot market dynamics such as drivers, restraints, opportunities, and challenges
Note: Challenges along with in-depth market dynamics analysis are mentioned in the report.
COVID-19 Impact on the Market
The outbreak of the COVID-19 pandemic is expected to exhibit both a positive and a negative impact on the global chatbot market in the forecast period. However, on the positive end, the chatbot market growth is attributed to the increasing usage of chatbots to communicate or to solve a query in varied industries like healthcare, banking & insurance, and retail. As the outbreak imposed a dramatical shutdown of these industries and forced people to stay in their homes, the chatbots emerged as an excellent solution and as a link between the two. During the pandemic, the chatbots helped with setting up remote work conditions for numerous organizations, leading to increased demand for chatbots. For instance, in April 2020, the WHO launched a chatbot on Facebook messenger to spread awareness, convey correct information about COVID-19 and avoid misconceptions.
The report also provides an in-depth analysis of key trends in the market
|1||The trend of incorporating chatbots on social networking sites is also estimated to grow due to the rising preferences of customers to use messaging applications over social media. For instance, the WHO has launched its Health Alert Platform version on a Facebook messenger to offer more accurate COVID-19 related information across the world||Positive|
|2||Significant developments in the Natural Language Processing (NLP) field are to utilize NLP to analyze huge amounts of Natural Language Data generated from chatbots||Positive|
The report also provides an in-depth analysis of recent news developments and investments
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