Chatbot Market Report by Type, Product, Application, Organization Size, Vertical, and Region 2024-2032

The global chatbot market size reached US$ 5.7 Billion in 2023. Looking forward, IMARC Group expects the market to reach US$ 34.6 Billion by 2032, exhibiting a growth rate (CAGR) of 21.5% during 2024-2032. The market is experiencing rapid growth, driven by the increasing demand for 24/7 customer support, widespread adoption of messaging platforms, rising utilization of chatbots in healthcare, enhanced customer engagement, ongoing integration with e-commerce platforms, heightened popularity of voice-activated assistants, growing omnichannel communication strategies, and the rise of conversational commerce.

Chatbot Market Analysis:

Major Market Drivers: Advances in artificial intelligence (AI) and natural language processing (NLP) technologies are driving the chatbot market by improving chatbot capabilities and user experience. Moreover, the market is growing as a result of increased adoption of instant messaging services, rising demand for 24/7 customer care, and greater operational productivity across multiple industries.

Key Market Trends: The growing use of chatbots in marketing, as firms use them to engage customers, create leads, and increase sales through tailored interactions, is a major market trend. Furthermore, the incorporation of chatbots into popular messaging networks and e-commerce systems is contributing to the expansion of this market.

Geographical Trends: North America is dominating the market, driven by the presence of leading technology companies, high adoption rates of advanced technologies, and substantial investments in AI research. Other regions are also seeing growth as a result of the expansion of digital infrastructure and regulatory support that encourages the deployment of chatbot solutions across various sectors.

Competitive Landscape: Some of the major market players in the chatbot industry include [24]7.ai, Inc., Acuvate Software Pvt. Ltd., Aivo, Artificial Solutions International AB, Creative Virtual Ltd., eGain Corporation, International Business Machines Corporation, Inbenta Holdings Inc., Kore.ai Inc., LiveChat Inc., Nuance Communications Inc., Verint Systems Inc., among many others.

Challenges and Opportunities: The chatbot industry overview highlights key issues such as guaranteeing data security and privacy, managing complicated integrations, and resolving user concerns about engaging with AI as major barriers to entry. However, opportunities exist in the growing use of chatbots in healthcare, banking, and customer service, as well as the development of increasingly complex, contextually aware, and personalized AI-powered chatbot systems.

Chatbot Market Trends:

Rising Demand for 24/7 Customer Support

The rising demand for 24/7 customer support is a major factor driving the chatbot market growth. Customers are increasingly expecting immediate responses to their queries, regardless of the time of day. According to an industry survey, 90 percent of customers rate an immediate response to be an important factor when they seek customer service assistance. Traditional customer service models rely heavily on human agents and, therefore, struggle to meet this expectation due to limited operating hours and the high cost of maintaining a large customer service team. This makes chatbots an appealing choice as they are known to operate round the clock without any downtime, providing instant responses to customer inquiries.

Growing Adoption of Messaging Platforms

The increasing adoption of messaging platforms is one of the leading chatbot market growth factors. As per industry reports, there have been 473 billion mobile interactions and a 91% increase in conversational messaging in the year 2024. Messaging apps like WhatsApp, Facebook Messenger, and WeChat have become integral parts of people's daily lives, with billions of users across the globe. These platforms offer businesses a unique opportunity to engage with customers in real-time and on a medium their customers are familiar with. For instance, Tata AIA Life Insurance, India, recorded that approximately 3000 customers successfully made payments worth Rs. 40 million for renewal through WhatsApp. The inclusion of chatbots into these messaging platforms is encouraging businesses to provide instant customer service, share information, and conduct transactions directly within the chat interface.

Increasing Use of Chatbots in Healthcare

Chatbots are increasingly being used in the healthcare industry, which is driving the expansion of this market. They provide a range of services, such as scheduling appointments, providing medical information, offering symptom checks, and mental health support. According to an industry survey, 74% of patients prefer a chatbot for simpler queries. Also, chatbots are reported to save the healthcare industry up to $3.7 billion by helping healthcare centers automate processes and take over tasks like appointment scheduling from front desk staff. Additionally, healthcare chatbots are known to analyze patient symptoms, provide preliminary diagnoses, and recommend appropriate actions by leveraging artificial intelligence (AI) and machine learning (ML). As per the Pew Research Center survey conducted in 2022, 38% say AI being used to do things like diagnose disease and recommend treatments would lead to better health outcomes for patients.

Chatbot Market Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the market, along with forecasts at the global, regional, and country levels for 2024-2032. Our report has categorized the market based on type, product, application, organization size, and vertical.

Breakup by Type:

Standalone

Web-based

Messenger-based/Third party

Standalone accounts for the majority of the market share

The report has provided a detailed breakup and analysis of the market based on the type. This includes standalone, web-based, and messenger-based/third party. According to the report, standalone represented the largest segment.

As per the chatbot market research report, standalone chatbots represented the largest segment. They operate independently without requiring integration with other applications or platforms, making them versatile and easy to deploy across various industries. These chatbots utilize advanced artificial intelligence (AI) and natural language processing (NLP) technologies to handle a wide range of tasks, such as customer service and personal assistance, without needing human intervention. Moreover, their ability to function autonomously allows businesses to streamline operations, reduce costs, and provide efficient, round-the-clock support to customers.

Breakup by Product:

Artificial Intelligence

Marketing

Human Intelligence

Marketing holds the largest share of the industry

A detailed breakup and analysis of the market based on the product have also been provided in the report. This includes artificial intelligence, marketing, and human intelligence. According to the report, marketing accounted for the largest market share.

Based on the chatbot market insights and forecast, marketing chatbots constituted the largest segment as they are designed to enhance customer engagement, generate leads, and boost sales by interacting with potential customers in a personalized and timely manner. These chatbots conduct product recommendations, answer queries, offer promotions, and guide users through the purchasing process. Moreover, their ability to operate across multiple platforms, such as websites, social media, and messaging apps, to ensure a broad reach and seamless integration into existing marketing strategies is expanding the chatbot market size.

Breakup by Application:

Bots for Service

Bots for Social Media

Bots for Payments/Order Processing

Bots for Marketing

Others

Bots for service represents the leading market segment

The report has provided a detailed breakup and analysis of the market based on the application. This includes bots for service, bots for social media, bots for payments/order processing, bots for marketing, and others. According to the report, bots for service represented the largest segment.

According to the chatbot market analysis and outlook, the bot for service accounted for the largest market share. Service chatbots are utilized to enhance customer support and service operations by providing instant and automated responses to customer inquiries. These bots are deployed across various platforms, including websites, mobile apps, and messaging services, to assist customers with tasks such as troubleshooting, booking appointments, tracking orders, and answering frequently asked questions. Additionally, their ability to operate 24/7 to reduce wait times and operational costs while also improving customer satisfaction and loyalty is positively impacting the chatbot market dynamics.

Breakup by Organization Size:

Small Enterprises

Medium Enterprises

Large Enterprises

Large enterprises exhibit a clear dominance in the market

A detailed breakup and analysis of the market based on the organization size have also been provided in the report. This includes small enterprises, medium enterprises, and large enterprises. According to the report, large enterprises accounted for the largest market share.

Based on the chatbot industry overview, large enterprises dominated the market as they are increasingly adopting chatbots to streamline operations, enhance customer engagement, and drive business efficiency. Moreover, these organizations leverage chatbots to handle high volumes of customer interactions, provide personalized support, and gather valuable insights into customer behavior. Besides this, the scalability of chatbots that allows large enterprises to deploy them across various departments, such as customer service, marketing, and human resource (HR) to ensure consistent and efficient communication is strengthening the chatbot market share.

Breakup by Vertical:

Healthcare

Retail

Banking, Financial Services, and Insurance

Media and Entertainment

Travel and Tourism

E-commerce

Others

E-commerce dominates the market

The report has provided a detailed breakup and analysis of the market based on the vertical. This includes healthcare, retail, banking, financial services, and insurance, media and entertainment, travel and tourism, e-commerce, and others. According to the report, e-commerce represented the largest segment.

E-commerce accounted for the largest chatbot market segment as businesses increasingly deploy chatbots to enhance the shopping experience, streamline customer service, and drive sales. These chatbots assist customers by providing product recommendations, answering queries about products and policies, facilitating smooth transactions, and handling post-purchase support such as order tracking and returns. Moreover, they leverage AI and ML tools to offer personalized interactions, tailoring responses and recommendations based on individual customer behavior and preferences. Additionally, chatbots enable e-commerce platforms to provide 24/7 support while catering to global customers in different time zones and ensuring a seamless shopping experience.

Breakup by Region:

North America

United States

Canada

Asia-Pacific

China

Japan

India

South Korea

Australia

Indonesia

Others

Europe

Germany

France

United Kingdom

Italy

Spain

Russia

Others

Latin America

Brazil

Mexico

Others

Middle East and Africa

North America leads the market, accounting for the largest chatbot market share

The report has also provided a comprehensive analysis of all the major regional markets, which include North America (the United States and Canada); Asia Pacific (China, Japan, India, South Korea, Australia, Indonesia, and others); Europe (Germany, France, the United Kingdom, Italy, Spain, Russia, and others); Latin America (Brazil, Mexico, and others); and the Middle East and Africa. According to the report, North America represents the largest regional market for chatbot.

North America's dominance in the market can be attributed to several factors, including the presence of leading technology companies, high adoption rates of advanced technologies, and substantial investments in AI and ML research and development (R&D). Furthermore, the robust digital infrastructure and high internet penetration that enable the widespread implementation of chatbot solutions across various industries, such as retail, healthcare, banking, and customer service, is one of the major chatbot market drivers. Additionally, the strong emphasis on personalized customer interactions and the growing demand for 24/7 customer support is fueling the market growth.

Competitive Landscape:

The market research report has also provided a comprehensive analysis of the competitive landscape in the market. Detailed profiles of all major companies have also been provided. Some of the major market players in the chatbot industry include [24]7.ai, Inc., Acuvate Software Pvt. Ltd., Aivo, Artificial Solutions International AB, Creative Virtual Ltd., eGain Corporation, International Business Machines Corporation, Inbenta Holdings Inc., Kore.ai Inc., LiveChat Inc., Nuance Communications Inc., Verint Systems Inc., etc.

(Please note that this is only a partial list of the key players, and the complete list is provided in the report.)

The major chatbot companies are innovating and expanding their offerings to stay competitive and meet the growing demand for advanced conversational AI solutions. They are investing in AI and NLP technologies to enhance the capabilities of their chatbot platforms. Moreover, several players are incorporating ML algorithms to improve chatbot accuracy, personalization, and contextual understanding. Additionally, they are expanding their chatbot integration capabilities across various platforms, including social media, messaging apps, and enterprise software, to provide seamless customer experiences. Besides this, leading companies are focusing on strategic partnerships and acquisitions to enhance their technology stacks and broaden their market reach.

Chatbot Market News:

In April 2024, Artificial Solutions signed an agreement with MedHelp Care for AI-based voice chatbot, Teneo. The company will integrate Teneo's voice chatbot into MedHelp Care's telephone service. This will reduce waiting times, increase the level of service, and free up nurses' time for more complex advice. Teneo offers advanced voice understanding to answer customer queries in any form, such as short voice commands or longer discussions with the system.

In November 2023, NatWest and International Business Machines (IBM) Corporation announced enhancements to the bank's virtual assistant, Cora, that will use generative AI to provide customers with access to a wider range of information through conversational interactions. By leveraging IBM's enterprise grade AI and data platform, watsonx, teams are co-creating a digital concierge (Cora+) that evolves the chatbot's capability into a more interactive and conversational experience.

Key Questions Answered in This Report

• 1. What was the size of the global chatbot market in 2023?
• 2. What is the expected growth rate of the global chatbot market during 2024-2032?
• 3. What has been the impact of COVID-19 on the global chatbot market?
• 4. What are the key factors driving the global chatbot market?
• 5. What is the breakup of the global chatbot market based on the type?
• 6. What is the breakup of the global chatbot market based on the product?
• 7. What is the breakup of the global chatbot market based on application?
• 8. What is the breakup of the global chatbot market based on the organization size?
• 9. What is the breakup of the global chatbot market based on the vertical?
• 10. What are the key regions in the global chatbot market?
• 11. Who are the key players/companies in the global chatbot market?