CHATBOT MARKET ANALYSIS

Chatbot MarketSize and Trends

Global chatbot market is estimated to be valued at US$ 30 Bn by 2030, exhibiting a Compound Annual Growth Rate (CAGR) of 25.7% from 2023 to 2030.

The global chatbot market was valued at US$ 4.85 Bn in 2022 and is expected to reach US$ 30 Bn by 2030, exhibiting a CAGR of 25.7% between 2023 and 2030.

Increased use of generative models in chatbots

Increasing use of generative models in chatbots has become a major market driver for the global chatbot market. By leveraging advanced language models, such as GPT-3, the chatbot's Natural Language Processing (NLP) capabilities have been enhanced to enable more sophisticated and contextual conversations with users. This improves the user experience by allowing chatbots to provide personalized, human-like responses. Additionally, the flexibility and adaptability of generative models allows chatbots to be tailored to specific industries and use cases, making them a very popular solution across multiple industries. As businesses increasingly realize the value of efficient and interactive customer interactions, the demand for chatbots based on generative models is expected to continue growing, driving significant growth in the global chatbot market. For instance, on July 20, 2023, Swiggy, an online food order and delivery services provider, announced in its blog post that it is on board the Generative AI bus to begin piloting its food recommendation tool in September. Swiggy is also working with a third party to build his GPT-4 based chatbot to provide customer support. In September 2023, Swiggy plans to test a neural search service that offers personalized recommendations in response to users' open-ended questions. Swiggy's neural search was created using Large Language Model trained on his database of 50+ million items in Swiggy's grocery catalog.

Growing need for effective and immediate customer support

Chatbots have emerged as the leading solution to meet the growing demand for immediate and effective customer support regardless of geographic restrictions. By offering 24/7 support, businesses can ensure uninterrupted service and give consumers access to world-class support to get their queries answered quickly. The ability of chatbots to simulate human-like conversations has become a key factor in increasing their value and improving the live chat customer service experience. Due to these benefits, companies in various industries are adopting chatbot technology to meet customer expectations and streamline customer support processes, and the global chatbot market is expected to witness significant growth in the coming years. For instance, on July 13, 2023, the CEO of Dukaan, an e-commerce company, has been reported to have laid off 90% of customer support staff and replaced them with artificial intelligence chatbot. The response time has gone down from 2 hours 13 minutes to 3 min 12 seconds and customer support costs have gone down by ~85%.

Figure 2. Global Chatbot Market Value (US$ Billion) Analysis and Forecast,