The global conversational AI market size to grow from USD 6.8 billion in 2021 to USD 18.4 billion by 2026, at a Compound Annual Growth Rate (CAGR) of 21.8% during the forecast period. Various factors such as increasing demand for AI-powered customer services, omnichannel deployment and reduce chatbot deployment cost, and rising demand for AI-based chatbots to stay informed and connected during Covid-19 are expected to drive the growth of Conversational AI market.
The COVID-19 pandemic has impacted trading activities across regions. It has had a moderate impact on all the elements of the technology sector. The hardware business is predicted to be the most impacted in the IT industry. Owing to the slowdown of hardware supply and reduced manufacturing capacity, the IT infrastructure growth has slowed down. Businesses providing solutions and services are also expected to slow down for a short period. However, the adoption of collaborative applications, analytics, security solutions, and AI is set to increase in the remaining part of the year. Verticals such as manufacturing, retail, and energy and utilities have witnessed a moderate slowdown, whereas BFSI, government, and healthcare and life sciences verticals have witnessed a minimal impact.
The Cloud segment to have the larger market size during the forecast period
Conversational AI market is segmented on the basis of deployment mode which include on-premises and cloud. The cloud segment is expected to account for a larger market share during the forecast period. Using cloud-based applications, SMEs can collect and analyze data easily to improve their customers’ experience. Organizations with more reliance on data security and privacy move toward the on-premises deployment mode to gain more control over their data and its security.
The SMEs segment to hold higher CAGR during the forecast period
On the basis of organization size the Conversational AI market has been segmented into large enterprises and SMEs. The SMEs segment is projected to record a higher CAGR during the forecast period. Verticals focus on adopting technologically advanced solutions and processes at a lower cost would drive the adoption of conversational AI solutions and services among SMEs. The availability of conversational AI technologies such as AI, ML, and deep learning will enable large enterprises to offer employees insights about customers’ buying behavior for a better customer experience.
The web-based segment to have the largest market size during the forecast period
On the basis of mode of integration the conversational AI market has been segmented into web-based segment,app-based segment and telephonic. The web-based segment is estimated to hold the largest market size during the forecast period. Conversational AI offers round-the-clock customer service as it answers commonly asked customer questions, resolves problems, and provides solutions in real-time. The app-based segment is expected to have the highest CAGR during the forecast period as conversational AI enables brands to detect consumer intents in real-time, build chatbots to fulfill those intents at scale alongside human experts, and deploy these AI-powered engagements across the most popular messaging channels.
Among regions, North America to hold higher CAGR during the forecast period
North America is projected to hold a higher CAGR during the forecast period. In North America, conversational AI solutions and services are highly effective in most organizations and verticals due to the increasing need to handle customer queries and enhance user experience. Europe is gradually advancing toward incorporating conversational AI within its market. APAC is showing a substantial rise in the adoption of conversational AI solutions and services during the forecast period, while Latin America and MEA are slowly picking up conversational AI due to its benefits for various industries to get user insights.
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: 34%, Tier II: 43%, and Tier III: 23%
- By Designation: C-Level Executives: 50%, D-Level Executives: 30%, and Others: 20%
- By Region: APAC:30 %, Europe: 30%, North America: 25%, MEA: 10%, Latin America: 5%
The report includes the study of key players offering the Conversational AI market. The major vendors covered are Google (US), Microsoft (US), IBM (US), AWS (US), Baidu (China), Oracle (US), SAP (Germany), FIS (US), Artificial Solutions (Spain), Kore.ai (US), Conversica (US), Inbenta (US), Creative Virtual (US), SoundHound (US), Avaamo (US), Haptik (US), Solvvy (US), MindMeld (US), Kasisto (US), Gupshup (US), Senseforth.ai (US), Cognigy (Germany), Rasa (US), Pypestream (US), Rulai (US), AmplifyReach (India), Saarthi.ai (India), Exceed.ai (US), Mindsay (US), and Clinc (US).
The research study for the Conversational AI market involved extensive secondary sources, directories, and several journals, including the International Journal of Operations & Production Management, and the International Journal of Production Research. Primary sources were industry experts from the core and related industries, preferred Conversational AI providers, third-party service providers, consulting service providers, end users, and other commercial enterprises. In-depth interviews were conducted with various primary respondents, including key industry participants and subject matter experts, to obtain and verify critical qualitative and quantitative information, and assess the market’s prospects.
Key Benefits of Buying the Report
The report would provide the market leaders/new entrants in this market with information on the closest approximations of the revenue numbers for the overall Conversational AI market and its subsegments. It would help stakeholders understand the competitive landscape and gain more insights better to position their business and plan suitable go-to-market strategies. It also helps stakeholders understand the pulse of the market and provides them with information on key market drivers, restraints, challenges, and opportunities.