The Global Chatbot Market Growth, COVID-19 Impact and Forecast (2021-2025)
The Global Chatbot market is segmented based on end-user type as small enterprises, medium enterprises and large enterprises; based on application as BFSI, travel & hospitality, retail & e-commerce, government, and others; based on thecomponent as solution and services; based on geography as APAC, Europe, North America, and ROW.
Introduction
A chatbot can be defined as an AI-based computer program that simulates human conversations. They are also known as digital assistants that understand human capabilities. Bots interpret and process the user requests and give prompt relevant answers.
Chatbots are poised to grow at a significant rate, owing to which the companies are ready to adopt the technology to their existing business portfolio. According to MIT technology review, 90% of the business reported faster complaints resolution with the bots.
Furthermore, chatbots are implemented across the BFSI sector to provide a better user experience, interact with customers in place of advisors, speed up response time, ease workloads, and others.
Bots can communicate through voice as well as text and can be deployed across websites, applications, and messaging channels such as Facebook Messenger, Twitter, or Whatsapp.
Table of Contents
Market Overview
The Global Chatbot Market is expected to grow to $76.28 billion by 2025 at a CAGR of 37.75%.
2/3 of leading global financial service firms have implemented chatbots since the onset of the COVID-19 pandemic.
Chatbots are used by 24% of enterprises, 15% of mid-sized companies, and 16% of small businesses.
In the wake of COVID-19, branding & advertising is expected to significant growth, owing to the rising focus on product expansion and lead generation strategies through intelligent virtual assistants.
Key Trends
In 2022, the banking industry could see the success rate of bot interactions reach over 90%, and 85% of customer support interactions will be performed by a chatbot.
Customers are more likely to shop with businesses that they can chat with.
Key Market Players
The market is dominated by global vendors like IBM, Microsoft, Google, AWS, Nuance, Oracle, and Creative Virtual.
The chatbot vendors have implemented various types of organic as well as inorganic growth strategies, such as new product launches, product upgrades, partnerships and agreements, business expansions, and mergers and acquisitions to strengthen their offerings in the market.
Growth Drivers and Challenges
The surge in the integration of chatbots with social media, increased awareness toward chatbots, and the rise in need towards the improvement of customer relationship management (CRM) are some of the factors that fuel the chatbot market growth.
Innovations in artificial intelligence and machine learning technologies are likely to enhance the features of chatbots, which act as a significant driver for the market.
An increase in installation cost of chatbots at the initial stage and lack of product differentiation restrain the market's growth.
One of the biggest challenges with using chatbots in customer support is interpreting the messages and understanding the user intention.