Chatbot Market to Reach $3.89 Billion by 2028

Market research firm Valuates expects the global chatbots market to reach $3.89 billion by 2028, up from $1.07 billion in 2021 and expanding at a compound annual growth rate of 20 percent.

The firm credits the increasing penetration of websites, social media platforms, and mobile applications as well as the demand for intelligent customer engagement, benefits such as time and cost savings, along with the ability to offer personalized bots through AI integration to drive market growth.

Businesses, the firm says, are integrating websites with chatbots to provide smooth customer experiences, and timely response and round-the-clock availability ensure that customers can get quick support and products are sold efficiently. Websites with chatbots lead to well-qualified leads and convert higher, and enterprises can get repeat customers and collect detailed user insights, it said.

Bots are also used for shopping recommendations and solving users' queries regarding products or services, the firm notes.

Intelligent natural language virtual assistants are playing a key role in improving the user experience in call centers, according to Valuates. Bots, it said, can comprehend human speech and identify the intent behind callers' inquiries without them having to say certain phrases or words. By establishing personalized interactions with customers and offering product recommendations based on past buying experiences, bots are expanding the growth prospects of the chatbots market. Furthermore, the AI-powered software helps push the prospects down the marketing funnel by guiding them through every aspect of the transaction. Chatbots predict customer behavior and send the right notifications to the right people every time. This provides an engaging shopping experience.

Companies are using chatbots on their smartphone apps for reaching customers directly, analyzing the messaging, and recommending which product fits a user's needs. This ensures that people can make informed decisions quickly, the firm found.

Bots are essential for businesses looking to reduce people-to-people interactions and cut labor costs. Apart from operational cost, massive savings comes from freeing workers from routine tasks, according to Valuates.

The firm also found that self-learning chatbots are on the rise as they can engage customers on a whole other level. This includes technical support, sales management, and account management. Bots can adapt to the changing conditions in the environment and mimic natural human-like interactions through the use of NLP and ML algorithms.

The report identifies Artificial Solutions, IBM Watson, Naunce Communications, eGain, Creative Virtual, Next IT, Speaktoit, Kustomer, and Codebaby as key market players.