Increasing demand for AI-powered customer support services, omnichannel deployment, and reduced chatbot development costto drive the growth of Conversational AImarket
The global Conversational Aimarket size is expected to grow from 4.8 billion in 2020 to USD 13.9 billion by 2025, at a Compound Annual Growth Rate (CAGR) of 21.9% during the forecast period.The upcoming trend of customer engagement through social media platforms and increasing integration of advanced AI capabilities are the major factors adding value to the conversational AI offerings, which is expected to provide opportunities for enterprises operating in various verticals in the conversational AI market.The lack of accuracy in chatbots and virtual assistants is a major challenge in the conversational AI market. Moreover, the lack of awareness of conversational AI acts as a key restraining factor in the market.
As the COVID-19 or coronavirus crisis has dragged on, understaffed government agencies, grocery stores, and financial services have all scrambled to set up chatbots and other conversational AI solutions for handling a new influx of calls. IBM witnessed a 40% increase in traffic to Watson Assistant from February to April of this year. In April, Google launched the Rapid Response Virtual Agent, a special version of its Contact Center AI, and lowered the price of its services in response to client demand. While call centers have long been a frontier of workplace automation, the pandemic has accelerated the process. Organizations under pressure are more willing to try new tools. AI firms that are keen on taking advantage of the situation are sweetening the incentives. Over the last few years, advances in NLP have also dramatically improved on the clunky automated call systems of the past. The latest generation of chatbots and voice-based agents are easier to build, faster to deploy, and more responsive to user inquiries. Once adopted, in other words, these systems are most likely to stay, proving their value through their ease of use and affordability.
Among the services, the training and consultingservices segment is expected to account for the higher market share during the forecast period
By service, the market size of the training and consulting segment is expected to be the largest during the forecast period.Consulting services include highly qualified industry experts, security professional, and domain experts to help and motivate organizations in minimizing risks, preventing revenue losses, and upgrading the existing conversational AI solutions in the market.Consulting services primarily focus on managing the operations revolution programs and the latest technology updates to help the client achieve strategic business goals through technical and professional improvements. Technology consulting helps the client achieve strong business mechanism and decision-making. Nowadays, several enterprises are fully aware of AI capabilities, the supremacy they can offer, and how they can transform the business processes to add more value.
Amongthe type of conversational AI platforms and solutions, the Intelligent Virtual Assistants (IVA)segment torecordthe higher growth rate during the forecast period
In the conversational AI market by type, the Intelligent Virtual Assistants (IVA) segment is expected to record the higher CAGR during the forecast period. The growth is attributed to the increasing demand for IVA among enterprises for proving customers better and personalized experience, thus strengthening customer engagement and retention imperatives. IVA utilizes advanced NLP, NLU, and dialog management techniques to achieve high levels of automation without sacrificing accuracy. With the help of IVA, complex customer queries can be handled effectively. It consists of an advanced dialogue management engine so that users can get full control over the conversational flow. Virtual assistants are, therefore, also capable of understanding customers’ intent, regardless of the order in which the data is given throughout the conversation. Virtual agents are designed to provide customer services, product information, marketing, support, sales, order placing, reservations, and other custom services.
Amongregions,APAC to grow at the highest CAGR during the forecast period
APAC is expected to grow at the highest CAGR during the forecast period. The major factors fueling the growth of the conversational AI market in APAC are the increasing amount of business data across verticals in this region and growing need to resolve customer queries in real-time and offer omnichannel customer experience in China, Japan, Australia, and India. These countries are leveraging information-intensive AI technologies, and conversational AI is one of the leading technology trends. IBM, Microsoft, Google, and AWS account for the majority of shares in the conversational AI market in this region. The region has the presence of several other significant conversational AI solution providers. SMEs and large enterprises in the APAC region have become more aware of government regulations and compliances and started adopting AI-based solutions proactively. The adoption of AI technology by different verticals such as BFSI, travel &hospitality, and retail is expected to contribute to the high growth of the conversational AI market.
Breakdown of primaries
In-depth interviews were conducted with Chief Executive Officers (CEOs), innovation and technology directors, system integrators, and executives from various key organizations operating in the conversational AI market.
- By Company: Tier I: 15%, Tier II: 42%, and Tier III: 43%
- By Designation: C-Level Executives: 62%, Directors: 20%, and Others: 18%
- By Region: North America: 40%, APAC: 30%, Europe: 20%, MEA: 5%, and Latin America: 5%
The report includes the study of key players offering conversational AI platform and services. It profiles major vendors in the global conversational AI market. The major vendors in the global conversational AI market includeMicrosoft (US), Google (US), AWS (US), Oracle (US), IBM (US), Baidu (China), SAP (Germany), Artificial Solutions (Spain), Conversica (US), Haptik (India), Nuance (US), Rasa (Germany), Avaamo (US), Kore.ai (US), Solvvy (US), Pypestream (US), Inbenta (US), Rulai (US), Creative Virtual (US), Saarthi.ai (India), FIS (US), AmplifyReach (India), Interactions (US), Quosphere (US), Exceed.ai (US), Cognigy (Germany), SoundHound (US), Kasisto (US), Mindsay (US) and Clinc (US).
The conversational AImarket is segmented bycomponent, type, technology, application, deployment mode, vertical, and region. A detailed analysis of the key industry players has been undertaken to provide insights into their business overviews; services; key strategies; new service launches; partnerships, agreements, and collaborations;business expansions; and competitive landscape associated with the globalconversational AImarket.
Key Benefits of Buying the Report
The report would help the market leaders/new entrants in the following ways:
- It comprehensively segments theconversational AImarket and provides the closest approximations of the revenue numbers for the overall market and itssubsegments across regions.
- It would help stakeholders understand the pulse of the market and provide information on the key market drivers, restraints, challenges, and opportunities.
- It would help stakeholders understand their competitors better and gain more insights to enhance their positions in the market. The competitive landscape section includes a competitor ecosystem, new service developments, partnerships, and acquisitions.