Conversational AI Market - By Component (Solutions, Services), By Type (Chatbots, Intelligent Virtual Assistant), By Deployment Mode (Cloud, On-premises), By Technology, By End User, By Application & Forecast, 2024 - 2032
Published Date: July - 2024 | Publisher: MIR | No of Pages: 240 | Industry: Media and IT | Format: Report available in PDF / Excel Format
View Details Buy Now 2890 Download Sample Ask for Discount Request CustomizationConversational AI Market - By Component (Solutions, Services), By Type (Chatbots, Intelligent Virtual Assistant), By Deployment Mode (Cloud, On-premises), By Technology, By End User, By Application & Forecast, 2024 - 2032
Conversational AI Market Size
Imagine having a conversation with a computer that understands you like a human. That's the power of Conversational AI (CAI)! In 2023, its market was worth a whopping $9.9 billion. And it's only going to get bigger. Experts predict that CAI will grow by over 21.5% every year until 2032. That's because it makes talking to computers so easy and enjoyable. CAI can chat with you like a friend, giving you personalized advice and answering your questions in real-time. It can even learn from your preferences to make things even more tailored to you. When businesses use CAI, they can connect with their customers on a deeper level. It's like having a personal assistant for every customer, ready to help them feel heard and understood. And guess what? Happy customers are loyal customers. They're more likely to stick with a business that makes them feel valued. That means CAI can not only improve customer service but also boost sales. So, if you're not already using CAI, you're missing out on a big opportunity to make your business more successful.
To get key market trends
The escalating customer expectations for swift, personalized interactions have catalyzed the rapid expansion of conversational AI solutions. By enabling businesses to provide instantaneous & tailored responses and automate repetitive tasks, these technologies have become cost-efficient solutions. Moreover, their ability to operate round the clock, seamlessly integrate with the existing systems, and offer scalable support have further propelled the adoption of conversational AI solutions.
| Report Attribute | Details |
|---|---|
| Base Year | 2023 |
| Conversational AI Market Size in 2023 | USD 9.9 Billion |
| Forecast Period | 2024 to 2032 |
| Forecast Period 2024 to 2032 CAGR | 21.9% |
| 2032 Value Projection | USD 57.2 Billion |
| Historical Data for | 2018 – 2023 |
| No. of Pages | 300 |
| Tables, Charts & Figures | 471 |
| Segments covered | Component, Type, Deployment Mode, Technology, End User, Application |
| Growth Drivers |
|
| Pitfalls & Challenges |
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What are the growth opportunities in this market?
The subject of data privacy and security poses a significant challenge to the conversational AI industry growth. As these systems handle sensitive user information, maintaining a robust safety measure against data breaches and unauthorized access is paramount. Striking a balance between providing personalized experiences and protecting user data is a complex task, particularly considering evolving data protection regulations. Ensuring that conversational AI platforms consistently meet these high standards of security and privacy will remain a key challenge for businesses & developers in the industry.
COVID-19 Impact
The COVID-19 pandemic had positive impacts on the conversational AI market. With lockdowns and social distancing measures in place, businesses turned to AI-driven chatbots and virtual assistants to maintain customer engagement & provide essential services remotely. The increased demand for online interactions and self-service options accelerated the adoption of conversational AI across industries, highlighting its ability to offer efficient and contactless solutions. This trend is expected to continue as businesses recognize the value of digital communication and automation.
Conversational AI Market Trends
Hey there! You know how you use search engines like Google to find information? Well, they're getting even better! These search engines are now using something called "conversational AI." It's like having a friend help you find what you need. You can just type in your question like you would normally, but the search engine will talk back to you in a friendly way. This makes it much easier and faster to get the answers you need. For example, if you ask, "What's the best recipe for chocolate chip cookies?" the search engine will give you a list of recipes and even answer follow-up questions like, "How long should I bake them?" Lots of people are using these conversational search engines, and they're really making a difference. In fact, Google recently said they're going to add conversational AI to their regular search engine. That means you'll be able to have conversations with Google just like you would with a friend. As more and more people start using conversational search engines, they're going to get even better at helping us find what we need. It's like the future of search is all about chatting with computers!
Conversational AI Market Analysis
Learn more about the key segments shaping this market
When it comes to using generative AI, businesses have two main optionscloud-based or on their own servers. In 2023, most companies still preferred the on-premise approach, with over 60% of the market share. To make generative AI easier to use for companies, there's been a lot of teamwork to develop on-premise solutions. This is helping the conversational AI industry grow because it makes it easier for businesses to use advanced AI models. By giving businesses better access to generative AI features like better customer service and better insights into the market, conversational AI solutions are becoming more popular. For example, Dell Technologies and NVIDIA started working together in May 2023 to make it easier to build and use generative AI models in on-premise environments. This aims to help businesses improve many parts of their operations, like customer service and company-wide searches.
Learn more about the key segments shaping this market
Based on end-user, the market is categorized into BFSI, healthcare, IT & telecom, retail & E-commerce, education, and media & entertainment, automotive and others. The retail & e-commerce segment held a market share of 22% in 2023 and is estimated to grow significantly till 2032. The retail and E-commerce industry is propelling the overall market by leveraging these technologies to enhance customer experiences. Conversational AI solutions, such as chatbots & virtual assistants, facilitate personalized customer support, product recommendations, and seamless transaction processes. As consumers increasingly shop online, businesses are adopting conversational AI to engage with customers, improve conversion rates, and streamline operations. This growing adoption in the retail and E-commerce sector underscores the pivotal role conversational AI plays in reshaping the future of customer engagement and boosting market growth.
Looking for region specific data?
North America led the global market with a share of over 32% in 2023. Technological advancements and the emergence of conversational AI startups in the U.S. are significantly driving growth in the North America conversational AI market. These startups are introducing innovative solutions that capitalize on the latest AI developments. With a focus on enhancing customer engagement and automation, they are also attracting substantial investments. This influx of innovation and investment is positioning North America as a hub for conversational AI, spurring market expansion and offering businesses advanced tools to improve customer interactions & operational efficiency.
Conversational AI Market Share
Some of the major players operating in the conversational AI industry are
- Amazon Web Services Inc.
- Google LLC
- IBM Corporation
- Jio Haptik Technologies Limited
- Conversica Inc.
- Microsoft Corporation
- Oracle Corporation
- FIS Global
- SAP SE
These companies focus on developing conversational AI systems that can handle multiple languages and dialects, allowing providers to enter new markets and serve a more diverse customer base.
Conversational AI Industry News
- In August 2023, Inbenta acquired Horizn, a software company based in Toronto that specializes in providing seamlessly embeddable interactive product demonstrations. This acquisition involves the incorporation of Horizn's technology into Inbenta's Artificial Intelligence (AI) customer experience platform.
- In August 2023, Kore.ai, a prominent provider of enterprise conversational & generative AI solutions, unveiled the integration of its Experience Optimization Platform with Zoom Contact Center. This integration offers Zoom Contact Center customers the capability to utilize an intelligent virtual assistant driven by the Kore.ai XO platform.
The conversational AI market research report includes in-depth coverage of the industry with estimates & forecast in terms of revenue (USD Billion) from 2018 to 2032, for the following segments
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Market, By Component
- Solutions
- Services
- Support & Maintenance
- System Integration & Implementation
- Training & Consulting
Market, By Type
- Chatbots
- Intelligent Virtual Assistant (IVA)
Market, By Deployment Mode
- Cloud
- On-premises
Market, By Technology
- Natural Language Processing (NLP)
- Machine Learning & Deep Learning
- Automatic Speech Recognition
Market, By End User
- BFSI
- Healthcare
- IT & Telecom
- Retail & E-commerce
- Education
- Media & Entertainment
- Automotive
- Others
Market, By Application
- Customer Support
- Personal Assistant
- Branding and Advertisement
- Customer Engagement & Retention
- Others
The above information is provided for the following regions and countries
- North America
- U.S.
- Canada
- Europe
- UK
- Germany
- France
- Italy
- Spain
- Russia
- Nordics
- Asia Pacific
- China
- Japan
- India
- South Korea
- ANZ
- Southeast Asia
- Latin America
- Brazil
- Mexico
- Argentina
- MEA
- Saudi Arabia
- UAE
- South Africa
Frequently Asked Questions (FAQ)
What is the size of the global conversational AI market?
The market size for conversational AI was valued at USD 9.9 billion in 2023 and is estimated to register a CAGR of over 21.5% between 2024 and 2032, owing to the growing adoption of AI solutions in numerous industries.
Why is on-premise deployment gaining traction in conversational AI industry?
The on-premise segment held a market share of over 60% in 2023 and will continue to grow through 2032, driven by the collaborative projects to develop on-premise generative AI.
How big is North America conversational AI industry?
North America led the global conversational AI market with a share of over 32% in 2023 and will continue growing through 2032, backed by technological advancements and the emergence of conversational AI startups in the U.S.
Who are the key players in conversational AI business?
Amazon Web Services Inc., Google LLC, IBM Corporation, Jio Haptik Technologies Limited, Conversica Inc., Microsoft Corporation, Oracle Corporation, FIS Global, and SAP SE.
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