February 24, 2024
Chatbot Market

Artificial Intelligence Projected To Boost The Growth Of Chatbot Market

The global Chatbot Market is estimated to be valued at US$ 6.04 Bn in 2023 and is expected to exhibit a CAGR of 25% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market Overview:

Chatbots are artificial intelligence (AI) software programs that can carry conversations using natural language. They leverage technologies such as NLP (natural language processing), ML (machine learning) and AI (artificial intelligence) to make natural conversations and assist customers with their queries round the clock. The growing adoption of technologies like AI and ML and the increasing ability of these technologies to understand human languages are enabling organizations to build more advanced chatbots. The increasing internet penetration, widespread adoption of smart devices and need to provide 24/7 customer support are leading to rising demand for chatbots across different end use industries like BFSI, retail, healthcare, travel & tourism amongst others.

Market key trends:

Growing investment in AI and chatbot development: Major technology giants like Google, Amazon, Microsoft etc are heavily investing in developing more advanced AI and chatbot platforms. This is leading to innovations in areas like natural language processing which is enabling creation of more human-like chatbots.

Increasing use of chatbots for various business functions: Chatbots are finding applications beyond basic customer support and are being used for functions like sales & marketing, onboarding & training, collecting feedback and more. This is broadening the use cases and driving more adoption.

Adoption of multilingual and cross platform chatbots: Vendors are focusing on developing chatbots with capabilities to support multiple languages and operate seamlessly across platforms like web, mobile apps, smart devices etc. This is increasing their reach and usability.

Porter’s Analysis

Threat of new entrants: The threat of new entrants in the chatbot market is low as it requires high capital investments and technological expertise to develop sophisticated artificial intelligence and natural language processing capabilities.

Bargaining power of buyers: The bargaining power of buyers in the chatbot market is high due to the presence of multiple players offering similar chatbot solutions. Buyers can easily switch between chatbot providers based on pricing and features.

Bargaining power of suppliers: Chatbot providers depend on technology companies for artificial intelligence, machine learning and natural language processing capabilities. Hence, the bargaining power of suppliers is moderate.

Threat of new substitutes: With continuous innovations in artificial intelligence, the threat of substitutes such as virtual assistants is high. Additionally, the adoption of conversational interfaces poses a threat to traditional chatbots.

Competitive rivalry: The competitive rivalry in the chatbot market is high due to the presence of global technology giants as well as numerous startups offering customized solutions. Players compete based on pricing, features, and platform and language support.

Key Takeaways

The Global Chatbot Market Demand is expected to witness high growth, exhibiting CAGR of 25.7% over the forecast period 2023 to 2030, due to increasing demand for enhanced customer support services.

The market size for 2023 is estimated to be US$ 6.04 Bn. North America dominates the global chatbot market currently due to rapid technological adoption. Asia Pacific is expected to grow at the fastest pace during the forecast period owing to rising investments in AI and bots by organizations in countries such as China and India.

Key players operating in the 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. These major players are focusing on partnerships, new product launches, and business expansions to increase their market share.

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it