The swelling business proposition for chatbots is evident in the inroads that artificial intelligence has made in services sector across numerous sectors. Messaging applications for customer services, such as query resolving with minimal human interaction, have proliferated in the banking and financial services sector. The uptake has also picked up pace over the past few years, given the characteristics of chatbots to combine remarkable reactiveness, scalability, and cost-effectiveness. Chatbots have, among other benefits, have reduced the time it takes to respond to a message and are much faster than a live agent that responds to typically through call centers.
Ubiquity of Mobile Devices Key Anchor for Small and Medium Enterprises
The swelling consumer proposition of mobile messaging apps for connecting with customers has been fueling the adoption of new technologies. Messaging platforms powered by chatbot have risen in popularity for various customer reach programs. Programs incorporating cutting-edge natural-language processing (NLP) and machine learning (ML) have opened the chatbot market to new opportunities waiting to be explored. The level of customer experience that chatbots have delivered through mobile messaging apps is a compelling proposition.
Over the years, countries in developed as well as the developing world have seen the pervasive use of mobile devices. The use of smartphones continue to proliferate in emerging economies. Thus, the ubiquity of mobile devices presents a massive avenue for small and medium-scale enterprises to address customer queries swiftly, proactively, and cost-effectiveness. A growing number of customers—more than half—prefer using messaging apps, and at least half of them would prefer making a purchase through messaging apps. All these trends have infused massive latent opportunities for technology companies in the chatbot market.
The market effects of these trends have been stark in the e-commerce and insurance sector. In the recent times of Covid-9, use of digital services to connect with customers and consumers are no more an option but have become more of a necessity, and businesses across the world are taking this to new level. In particular, e-commerce companies have been harnessing the chatbot technologies to make first-point contact.
The vast possibilities in the market are underscored by the projection that it will expand at CAGR of 31.3% during 2020 – 2027.
AI-based Chatbots Assisting Humans to Offer Convenience and Service
The standardized models on offering services to internal and external customers have fallen apart from the inroads made by AI and ML. Technology services companies and software companies are vigorously exploring new avenues in artificial intelligence to train their chatbot to do complex tasks. Such chatbots are gaining popularity as digital assistants and are being tested for complex tasks, in addition to several routine tasks. One such area is developing chatbots for context-aware applications. With the evolution of AI, the use of chatbots for performance monitoring and analytics is expected to gain traction in the chatbots market, adding sizable revenue streams for developers. In the near future, such technological strides will propel the advent of chatbots that are keenly addressing the personalized needs of end users and customers.
Data is expected to become another key framework around which new avenues in the chatbots market will emerge. Big data sources will help boost the performance of data-driven and predictive chatbots in various applications.
In coming years, chatbot developers and end-use industries have thrown their eight behind the strategic angle of chatbots. The motivating factor has been the growing business prospects of consumer-oriented apps as enabler and accelerant for customer engagement in this hyper-competitive world.
Industries in North America Rapidly Deploying Chatbots to Attract Vast Consumer Base
Developed markets have seen rise in deployment of chatbots for branding and customer engagement. North America for one has been high on adoption rate. The regional market held the major share globally in 2019, where its valuation was pegged at USD 132.75 Mn, and is expected to rise at most attractive rate through 2027. A sizable spate of opportunities have come the U.S. and Canada.
Asia Pacific Market Showing Vast Latent Opportunities
Asia Pacific is expected to be a promising regional market, and is expected to exhibit a high CAGR during 2020 – 2027. In this regard, two key trends are expected to fuel the future growth prospects. The rise in use of mobile devices for businesses for connecting with customers and the demand for AI for offering personalized assistance to media publications have bolstered the prospects in the chatbot market. A great deal of these can be ascribed to the ‘mobile-first’ approach many companies across industries have been adopting in their strategies. Rise in use of chatbot for social media channels aiming client-facing operations is a key trend bolstering the prospects. In the developing world, the use of such channels has soared in recent years. The growing spending of businesses of all sizes on social media marketing is opening new avenues for expanding the revenue prospects of end-use industries.
Some of the technology companies aspiring to consolidate their stakes in the chatbot market are Yahoo Inc., Microsoft Corporation, Kasisto Inc., Imperson Ltd., Helpshift, Haptik, Inc., Google, Inc., and Facebook, Inc.