The global chatbots market was valued at US$ 4.85 Bn in 2022, and is projected to reach US$ 30 Bn by 2030, exhibiting a CAGR of 25.7% over the forecast period (2023-2030). According to the Global Chatbot Market Report, " By Platform (Web-based, Mobile, and Stand-alone), By Enterprise Size (Large Enterprises and Small and Medium Enterprises) and By Region (North America, Europe, Asia Pacific, Latin America, and Middle East and Africa).
Chatbots are sophisticated software tools that enable seamless interaction between humans and machines, enabling natural and meaningful conversations via online text or voice. Businesses can effectively interact with their customers through various communication methods such as video, text, voice, file sharing, and images. These chatbots are easily accessible through digital platforms including mobile apps, websites, and standalone devices, making them easy to use and widely available. Additionally, Over-the-top (OTT) messaging apps are revolutionizing the way businesses interact with their customers, offering great opportunities for efficient communication. Companies are taking a platform-based approach, integrating services into communication apps to offer features such as games, payments, and advertising. Chatbots have made remarkable progress owing to advancements in artificial intelligence, but there are also challenges such as insufficient understanding of complex queries and privacy and security concerns.
Global Chatbot Market- Drivers
Increasing use of messaging applications
Over-the-top (OTT) applications, such as WhatsApp and Facebook Messenger, are rapidly gaining popularity. The market is expected to grow because people are more interested in messaging applications than social networking sites. There will be a large future market demand for chatbots that integrate with these messaging applications. Automated messaging between applications and people is expected to grow significantly as tasks, such as making hospital appointments, checking flight status, placing orders on e-commerce sites, and finding deals. People will get used to automated customer service more than most corporate emails or IVR service because it provides an immediate solution. The demand for future chatbots is expected to be driven by machine learning and artificial intelligence that improve chatbot technology.
Global Chatbot Market- Restraints
Privacy and security concerns among customers
Concerns about privacy and security pose major barriers to the global chatbot market. Chatbots deal with highly sensitive customer data, so protecting privacy and ensuring robust security measures are paramount. Data breaches and misuse of customer information can have serious consequences including financial loss, legal liability, and damage to brand reputation. To address these concerns, organizations must implement robust encryption and authentication protocols to protect data in transit and at rest. Additionally, compliance with relevant data protection regulations, such as General Data Protection Regulation and California Consumer Privacy Act, is critical to building customer trust and maintaining regulatory compliance. Regular security audits, vulnerability assessments, and continuous monitoring are critical to identifying and mitigating potential risks. By prioritizing privacy and security, businesses can build trust with their customers and create a safe environment for the effective use of chatbot technology.
Global Chatbot Market- Key Developments
In February 2021, Nuance Communications, Inc., a technology company specializing in conversational AI announced the acquisition of Saykara, Inc., a startup focused on developing mobile AI assistants that automate clinical documentation for physicians. The acquisition underscores Nuance Communications, Inc.'s continued expansion of its market and technology leadership in conversational Artificial Intelligence (AI) and Ambient Clinical Intelligence (ACI) solutions that reduce physician burnout, improve patient experience, and boost the financial health of the healthcare system as a whole.
On May 31, 2023, Kasisto, a provider of digital experience platforms for the financial services industry, announced the launch of KAI-GPT, the world's first bank-specific Large-scale Language Model (LLM) tailored to the industry's specific needs for accuracy, transparency, reliability, and customization. KAI Answers is based on KAI-GPT and is Kasisto's first generative AI application powered by LLM. For bankers on the front line of customer service, the right answers are delivered quickly through a contextual, human-like conversational experience.
On July 3, 2023, Travelxp and Haptik launch new Instagram chatbot for travelers. Travel and lifestyle content provider, Travelxp has partnered with conversational commerce platform Haptik to launch an innovative solution to travel concerns for travelers. Travelxp's 24/7 Instagram chatbot not only responds to traveler inquiries in real-time, but also provides valuable assistance with travel planning, accommodation options, budget advice, and others.
Global Chatbot Market- Impact of COVID-19
The COVID-19 pandemic had a severe effect on businesses across the globe. The pandemic has had a major impact on the global chatbot market. Businesses faced a surge in online interactions and customer inquiries due to lockdowns and social distancing measures. Chatbots have proven to be an essential tool in addressing the growing demand for digital customer support as they provide a cost-effective and efficient solution for maintaining continuity of service. The pandemic accelerated the adoption of chatbots across multiple industries to help businesses manage disruptions and ensure smooth customer interactions. However, the market also faced challenges as the uncertain economic situation forced some companies to reconsider their investment plans and affected their adoption of chatbots. Despite the obstacles, the pandemic has highlighted the importance of digital transformation and the need for effective remote customer service, paving the way for the global chatbot market for continued growth in the post-pandemic era.
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Key Trends and Analysis of the Global Chatbot market:
- The mobile segment held a dominant position in 2022 and is projected to retain its dominance throughout the forecast period. Market growth is anticipated to receive a boost due to the increasing emphasis on prompt and improved customer assistance, coupled with the rising usage of messaging applications.
- North America held a dominant position in the global chatbot market in 2022 and is expected to maintain its dominance during the forecast period, owing to increasing adoption of omnichannel support to enhance customer experience and the e-commerce boom
- The Asia Pacific chatbot market is projected to exhibit the highest CAGR during 2023-2030 owing to rapid digitalization and the expanding mobile user base
- Europe, Middle East, and Africa are also expected to show significant growth during the forecast period
- Some of the major players in the global chatbot market are Facebook, Inc., Kiwi, Inc., Astute Solutions, Google, Inc., Pandorabots, Inc., Haptik, Inc., Yahoo Inc., Helpshift, ToyTalk (PullString Inc.), Imperson Ltd. Slack Technologies, Inc., Kasisto Inc., and Microsoft Corporation
