Conversational AI Market size touched USD 6.3 billion in 2021 and is estimated to reach USD 31.7 billion in 2029 and the market is estimated to grow at a very high CAGR of 22.4% from 2022-2029 due to rising demand for AI-powered costumer support services and reduced chatbot development cost.

To have an edge over the competition by knowing the market dynamics and current trends of “Conversational AI Market,” request for Sample Report here

Major Conversational AI Market Trends and Drivers

Global conversational Ai market is primarily driven by increasing demand for AI-powered customer support services across industry verticals, reduced chatbot development cost and rise in the deployment of omnichannel methods. Companies have shifted their focus from providing customer support services through emails and messages to AI-powered chatbots for improving customers experience and engagement, owing to technological advancements in Artificial Intelligence and Machine Learning, which is contributing towards the market growth.

Technologies such as Artificial Intelligence and Natural language processing has helped enterprises to build intelligent agents and performing tasks integrated with other multiple platforms. Adding gesture recognition capabilities within Conversational AI offering will help users to control smart conversational devices without touching and speaking, which is expected to increase the growth opportunities for conversational Ai market in the upcoming years. Some of the conversational Ai market trends includes services offered by major players in regional languages to increase their product offering. For instance, in December 2021, Amazon Lex launched language support for Brazilian Portuguese, Mandarin Chinese and Portuguese, to enhance the conversational experiences of customers. Moreover, growing popularity of chatbot solutions and increase in time spent by customers on mobile messaging apps are some of the additional factors supplementing the conversational Ai market share in the overall Artificial Intelligence Market. Messaging has emerged as the most convenient form of communication, the time spent by adults across united states on mobile-messaging apps has increased 20% in 2022 over 2019 from an average of 20 minutes per-day in 2019 to 24 minutes per-day in 2022. However, limited knowledge amongst consumers about the benefits of virtual assistants and chatbots is restricting the growth of conversational Ai market.

Do you want to know more about the Research process and detailed Methodology, Request Research Methodology of this report

Based on Component, Service segment is estimated to capture the largest market share.

According to our conversational Ai market research report, increasing demand for improved customer support services across industry verticals such as Media & Entertainment and Telecom, is the major factor accelerating the segment’s growth.

Based on Type, Chatbots segment is projected to hold the highest market share attributed to its increasing use for collecting data.

Chatbots provides round-the-clock service to customers and enhances engagement, which are some of the factors supplementing the segment’s growth. In addition, chatbot is increasingly adopted in different industries such as Retail & eCommerce, Travel & Hospitality and BSFI owing to its ability to quickly handle client queries.

Cloud segment is projected to dominate the market due to its ability to power self-service solutions.

Cloud adoption in contact centers is moving forward at a rapid pace, as per Deloitte’s report, 75% of the contact centers are planning to migrate their operations to cloud by mid-2023. In October 2022, Genesys announced its plans, that it will focus its efforts on its Genesys Cloud CX software over on-premises solutions. Over 550 customers including large enterprises have already migrated to Genesys Cloud CX.

Natural Language Processing segment is estimated to dominate the market

Natural Language Processing technology helps in streamlining of documentation processes to increase efficiency, which is one of the major factors propelling the segment’s growth. In addition, organizations are focusing to deliver customer support services through AI-powered chatbots to enhance customer interaction and these chatbot uses NLP technology to provide business intelligence related to purchase behaviours and preference of customers.

Retail & Ecommerce segment held the largest market share in 2022

Enterprises operating in the e-commerce industry are adopting intelligent conversational AI tools and techniques to enhance customer’s experience. Automotive segment is projected to grow at a higher CAGR attributed to real-time recommendations and alerts provided by AI voice assistants to ease the daily commute of passengers.

In case, any of your pain points areas are not covered in the current scope of this report, Request for Customization here

North America holds the largest conversational Ai market share owing to increasing investments by major players on different technologies.

Conversational AI Market in North American region is driven by rising demand for AI-powered customer support services by organizations to increase customer retention and increasing adoption of advanced technologies such as Virtual Reality (VR), Artificial Intelligence (AI) and Robotics across the healthcare industry.

Conversational AI Market in Asia-Pacific region is driven by rising awareness amongst enterprises about innovative customer support services, expanding e-commerce industry and increasing internet penetration rates. Conversational AI solutions are gaining popularity in Europe due to increasing focus of enterprises on reducing workload and enhancing customer engagement and retention.

Top Market Players

Various notable players operating in the market include Microsoft, Google, IBM Corporation, Amazon Web Services, Inc., Nuance Communications, Inc., Oracle, SAP SE, Baidu, Kore.ai, Inc., and Artificial Solutions, among others.

Key Developments:

• • In March 2022, Google announced its Cloud Contact Center AI Platform, which offers end-to-end solution for the contact center. It offers benefits of AI, cloud scalability and multi-experience capabilities, with customer relationship management (CRM) platforms to enhance the customer experience.
  • In March 2022, Kore.ai, one of the leading conversational AI software platform and solutions company, inaugurated its new office in India to support its recruitment drive and expand its footprint in the international market.
  • In 2020, Nuance Communications, Inc. launched NuanceMix, a (SaaS) tooling suite, which is designed for creating advanced conversational experiences that power Virtual Assistants (VA) and IVR using cloud-agnostic Conversational AI.
  • In 2019, Microsoft launched a dialogue generative pre-trained transformer (DialoGPT), trained on 147M conversation-like exchanges extracted from Reddit comment chains between 2005 to 2017. DialoGPT generates more relevant and context-consistent responses as compared to strong baseline systems.

Segments covered in the Report:

The global conversational AI market has been segmented on the basis of component, type, technology, deployment mode, application, vertical, and region. Based on the component, the market is segmented into services and platform. The services segment is further categorized into systems integration & deployment, training & consulting, and support & maintenance. Based on the type, the market is segmented into chatbots and intelligent virtual assistants. Based on the technology, the market is segmented into natural language processing, machine learning & deep learning, and automated speech recognition. Based on the deployment mode, the market is segmented into on-premises and cloud. Based on the application, the market is segmented into a personal assistant, customer support, customer engagement & retention, branding & advertisement, data privacy & compliance, onboarding & employee engagement, and others. Based on the vertical, the market is segmented into retail & ecommerce, BFSI, travel & hospitality, healthcare & life sciences, media & entertainment, telecom, and others.

For detailed scope of the “Conversational AI Market” report request a Sample Copy of the report

Market Segmentation:

Global Conversational AI Market by Component

• • Services
    • Systems Integration & Deployment
    • Training & Consulting
    • Support & Maintenance
  • Platform

Global Conversational AI Market by Type

• • Chatbots
  • Intelligent Virtual Assistants
  • Global Conversational AI Market by Technology
  • Natural Language Processing
  • Machine Learning & Deep Learning
  • Automated Speech Recognition

Global Conversational AI Market by Deployment Mode

• • On-Premises
  • Cloud

Global Conversational AI Market by Application

• • Personal Assistant
  • Customer Support
  • Customer Engagement & Retention
  • Branding & Advertisement
  • Data Privacy & Compliance
  • Onboarding & Employee Engagement
  • Others

Global Conversational AI Market by Vertical

• • Retail & Ecommerce
  • BFSI
  • Travel & Hospitality
  • Healthcare & Life Sciences
  • Media & Entertainment
  • Telecom
  • Others

Global Conversational AI Market by Region

• • North America Conversational AI Market (Option 1: As a part of the free 25% customization)
    • By Component
    • By Type
    • By Technology
    • By Deployment Mode
    • By Application
    • By Vertical
    • United States of America (US) Market All-Up
    • Canada Market All-Up
  • Europe Conversational AI Market (Option 2: As a part of the free 25% Customization)
    • By Component
    • By Type
    • By Technology
    • By Deployment Mode
    • By Application
    • By Vertical
    • United Kingdom (UK) Market All-Up
    • Germany Market All-Up
    • France Market All-Up
    • Spain Market All-Up
    • Rest of Europe Market All-Up
  • Asia-Pacific Conversational AI Market (Option 3: As a part of the free 25% Customization)
    • By Component
    • By Type
    • By Technology
    • By Deployment Mode
    • By Application
    • By Vertical
    • China Market All-Up
    • India Market All-Up
    • Japan Market All-Up
    • Rest of APAC Market All-Up
  • RoW Conversational AI Market (Option 4: As a part of the free 25% Customization)
    • By Component
    • By Type
    • By Technology
    • By Deployment Mode
    • By Application
    • By Vertical
    • Brazil Market All-Up
    • South Market All-Up
    • Saudi Arabia Market All-Up
    • UAE Market All-Up
    • Rest of world (remaining countries of the LAMEA region) Market All-Up

Major Players Operating the Conversational AI (Option 5: As a part of the free 25% Customization – Profiles of 5 Additional Companies of your Choice)

• • Microsoft
  • Google
  • IBM Corporation
  • Amazon Web Services, Inc.
  • Nuance Communications, Inc.
  • Oracle
  • SAP SE
  • Baidu
  • Kore.ai, Inc.
  • Artificial Solutions