Chatbot market to reach $1.25bn by 2025
The prolific growth of the chatbot industry means greater opportunities for large enterprise, according to new research
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The global chatbot market is expected to reach $1.25bn by 2025, growing at a compund annual growth rate (CAGR) of 24.3 per cent, according to a new report by US-based market research firm, Grand View Research.
The chatbot industry is expected to witness significant growth over the forecast period as the technology increasingly enables enterprises to substantially reduce operating costs. Additionally, innovations in artificial intelligence and machine learning technologies are likely to enhance the features of chatbots, which acts as a major driver for the market.
Large enterprise emerged as the biggest end-user segment in 2016 and is estimated to register a CAGR of 24.2 per cent over the forecast period. Increasingly, chatbots have found wide applications in large enterprises as they enable better understanding of consumer behavior with the help of machine learning.
The research also found that North America is expected to emerge as the major region for the chatbot market, with growth in this area attributed to the increasing deployment of chatbots in various business verticals.
On the other hand, the Asia Pacific market is projected to witness substantial growth—24.7 % from 2017 to 2025—owing to various technological developments across major economies.
To date, a significant rise has been observed in the number of users of messaging services, which is expected to surpass the number of users of social networking sites. Additionally, developments in the field of natural language processing (NLP) has resulted in streamlined interactions between computers and human languages.
And, with the entire chatbot ecosystem comprising cross-linking features to facilitate enhanced performance, this can only result in a better user experience. In fact, most companies prefer in-built chatbots—such as Slack or Twitter messaging—on their websites as they facilitate enterprises in providing instant customer interaction.
Finally, artificial intelligence and audio speech-based chatbots are expected to account for the largest market share in future. Improvements in speech recognition—especially in terms of native languages—and the rapid evolution of technologies such as AI, IoT and APIs will result in increased operational ability, further driving market demand.