The Global Chatbot Market, By Platform (Web-Based, Mobile and Stand-alone), By Enterprise Size (Large Enterprises, Small and Medium Enterprises), and by Region (North America, Europe, Asia Pacific, Latin America, Middle East and Africa) - Global Forecast to 2027”, is expected to be valued at US$ 2,020.2million by 2027, exhibiting a CAGR of 28.3% during the forecast period (2019-2027), as highlighted in a report published by Coherent Market Insights.
A chatbot is a computer program that is designed to simulate human conversation through text or voice commands or both. Chatbots are programmed to convincingly simulate how a human would behave as a conversational partner. Chatbot is programmed with natural processing language for conversation with user and provides augmented customer engagement in different applications including banking financial services and insurance, healthcare, e-commerce, retail, etc. OTT chat platforms have made a tremendous change in gaming, advertising campaigns, and communication. It has given marketers a platform for branding their product, for example, the hashtag campaigns emerging on Twitter and Instagram apps. Demand for OTT chat platforms is expected to surge from business and consumer usage.
The global chatbots market was valued US$ 274.5 Mn in 2019 and expected to reach US$ 2020.2 Mn by 2027.
Increasing applications of chatbots in a plethora of industry verticals are expected to drive growth of the global chatbot market during the forecast period
Rising evolution of text-based services over phone calls and increasing applications of chatbots are expected the major factors driving growth of the market. The majority of chatbot applications are found in hotels, travel, e-commerce, news, customer service, and printing. Moreover, many organizations are focused on developing their own personal chatbots, in order to meet the personal interest of users. For instance, a weather alert bot is used to deliver information about the current weather condition. Thus, these factors are expected to propel the global chatbot market growth over the forecast period.
Offering chatbot as a service can present major growth opportunities for market players in the near future
Software-as-a-service (SaaS) is one of the popular cloud computing models and an effective method to manage organizations’ capital expenditure. For several bots with complex pricing models, chatbots as a service can be lucrative option to help customers and developing teams be more active in terms of production, tackling communication challenges and managing tasks, and thereby replacing the existing B2B software in the future.
High initial cost and lack of product differentiation are expected to hamper the global chatbot market growth during the forecast period
Implementation of chatbots require high initial investment, thus small- and medium-sized companies in emerging economies are reluctant to incorporate chatbots into their businesses. Moreover, there is lack of product differentiation in the market, which hinders adoption of chatbots. Low awareness regarding benefits of chatbots is another factor expected to hinder the global chatbot market growth during the forecast period.
Chatbot security models are expected to gain significant traction in the near future if they are used to manage sensitive conversations among systems and users. While the security architectures of the mobile and web systems are dedicated to areas such as authorization, authentication, and federation, opportunities in chatbot security are expected to be in the areas of data compliance, data privacy, and data access control.
Chatbots based on artificial intelligence can offer enhanced customer intelligence/engagement enterprises. By adopting conversation interface, more and more organizations are allowing customers to interact with businesses in a conversational format without additional applications. For instance, KLM airlines, have adopted conversational interface where a user can simply resolve its queries all at one place that requires no learning curve. Sephora, is also utilizing chatbots to enhance customer engagement while improving the discoverability of their products among huge product portfolio.
Key companies operating in the global chatbots 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.