Chatbot Market Size & Share Research by 2027

Chatbot Market Forecast to 2027 – Global Analysis – by Component (Solution and Services), Deployment (On-premise and Cloud), Usage (Website, Contact Centers, Social Media, and Mobile Platform), and End User (Education, Retail & E-Commerce, BFSI, Healthcare, Travel & Tourism, and Others)

Publication Month : Apr 2019

  • Report Code : TIPTE100000724
  • Category : Technology, Media and Telecommunications
  • Status : Published
  • No. of Pages : 209
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The chatbot market size is projected to reach US$ 9475.1 million by 2027 from US$ 1072.4 million in 2018; it is expected to witness a significant market growth 27.9% during 2019–2027.

Chatbots are artificial intelligence (AI) systems that engage customers via test, messaging, or speech. The platforms such as Facebook, WhatsApp, Slack, WeChat, or text messages are using chatbots. Some grocery stores use chatbots in cash counters for self-checkout and ordering kiosks at restaurants. This saves not only time but also money. For Instance, Amazon recently opened a store without any cashiers. This will limit human interactions to only those that are necessary. Chatbots help companies reduce the average time to respond, bringing them closer to their customers’ expectations.

The rise in adoption of customer service activities in enterprises to decrease operating costs is expected to drive the growth of chatbot market during the forecast period.

The factors that are contributing to the chatbot market growth include the rise in the need for 24/7 customer support at a low operational cost, a rise in focus on customer engagement through multiple channels and technological advancements, coupled with increasing customer demand for self-service. The chatbot market is expected to witness high growth because of the rise in the demand for enhanced customer experience and building personalized relations with prospects. Various verticals would deploy a diverse array of chatbot services to enable technological transformation initiatives that improve operations, differentiate client viewing experiences, and address mission-critical processes. The operational cost reduction, customer satisfaction, customer query resolution, enhanced visibility into operations and processes, and better real-time decision making are key business and operational priorities expected to increase the chatbot market growth.

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Chatbot Market: Strategic Insights

Market Size Value inUS$ 1072.4 million in 2018
Market Size Value byUS$ 9475.1 million by 2027
Growth rateCAGR 27.9% from 2019 to 2027.
Forecast Period2019-2027
Base Year2019
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– Chatbot Market

Chatbot Market Insights

According to the chatbot market analysis, Europe held the largest market share in 2020.

In APAC, there are various startups investing and contributing in chatbot and machine learning technology. Small and medium-sized corporates are steadily integrating chatbots in the customer service process, which provides seamless performance, handles many customers, and develops customer engagement techniques. With the increase in information and technology infrastructures in developed and developing economies, such as India, Australia, Japan, and China in the region, the chatbot market is expected to rise further. The rise in the adoption of smartphones and massive population in APAC are creating a promising customer pool for the chatbot market, according to the market analysis.

Chatbot Market Analysis – Segmental Overview

The chatbot market is segmented on the basis of component, deployment, usage, and end user. Based on component, the chatbot market is segmented into solutions and services. Based on deployment, the chatbot market is categorized into on-premise and cloud. By usage, the chatbot market is segmented into website, contact centers, social media, mobile platform. On the basis of end user, the chatbot market is divided into education, retail & e-commerce, BFSI, healthcare, travel & tourism, and others. On the basis of geography, the chatbot market size is primarily segregated into North America, Europe, Asia Pacific (APAC), the Middle East & Africa (MEA), and South & Central America.

Deployment-Based Market Insights

On the basis of deployment, the chatbot market is segmented into the cloud and on-premise. The cloud segment of deployment is expected to lead the chatbot market during the forecast period. The segmental rise is majorly driven by the increase in investment from the prominent players for the development of bot technology that is based on cognitive & AI systems. The cloud-based chatbots handle various confidential business information such as employees’ social security numbers, client contact details, accounting & invoices, supply chain management, and other business-related data. Further, the increasing trend of cloud-based natural language intelligent bots, including Alexa, Google Assistant, and Siri, is likely to drive the growth of the chatbots market during the forecast period.

The on-premise segment is expected to rise with decent CAGR during the upcoming years. SMEs prefer affordable solutions by implementing on-premise solutions in their business which would be beneficial for the growth of the chatbot market. The on-premises services provide organizations to automate the process of their business while assisting in recommending solutions to users. Virtual assistants are rising due to machine learning, deep neural networks, and other technological advancements in artificial intelligence. Chatbots and smart speakers are used in multiple applications across various end-user industries, such as BFSI, retail, healthcare, and Travel & Tourism, etc. Chatbot platform helps reduce dependency on vendors by providing sufficient space for customization along with monitoring data access and usage closely.

Players operating in the chatbot market are mainly focused on the development of advanced and efficient products. Chatbot market companies are implementing various strategies to match the technological advancements in the market. Amazon Web Services; Artificial Solutions; Creative Virtual Pvt. Ltd.; CX Company; eGain Corporation; IBM Corporation; INBENTA TECHNOLOGIES INC; Microsoft; Nuance Communications, Inc.; and Verint Systems Inc. are a few chatbot market-leading players.

  • In 2021, IBM Corporation announced that it is creating AI-powered chatbots in collaboration with UNSW Business School that would solve a real-world problem for the markets.
  • In 2021, Microsoft Corporation filed a patent which increased the intriguing possibility of technologically reincarnating people as a chatbot. Chatbots will use conversations and materials from a large sample of users.
Report Coverage
Report Coverage

Revenue forecast, Company Analysis, Industry landscape, Growth factors, and Trends

Segment Covered
Segment Covered

Component, Deployment, Usage, and End User

Regional Scope
Regional Scope

North America, Europe, Asia Pacific, Middle East & Africa, South & Central America

Country Scope
Country Scope

US, Canada, Mexico, UK, Germany, Spain, Italy, France, India, China, Japan, South Korea, Australia, UAE, Saudi Arabia, South Africa, Brazil, Argentina

The List of Companies - Chatbot Market

  1. Amazon Web Services
  2. Artificial Solutions 
  3. Creative Virtual Pvt. Ltd. 
  4. CX Company 
  5. eGain Corporation 
  6. IBM Corporation
  8. Microsoft
  9. Nuance Communications, Inc. 
  10. Verint Systems Inc.

The Insight Partners performs research in 4 major stages: Data Collection & Secondary Research, Primary Research, Data Analysis and Data Triangulation & Final Review.

  1. Data Collection and Secondary Research:

As a market research and consulting firm operating from a decade, we have published many reports and advised several clients across the globe. First step for any study will start with an assessment of currently available data and insights from existing reports. Further, historical and current market information is collected from Investor Presentations, Annual Reports, SEC Filings, etc., and other information related to company’s performance and market positioning are gathered from Paid Databases (Factiva, Hoovers, and Reuters) and various other publications available in public domain.

Several associations trade associates, technical forums, institutes, societies and organizations are accessed to gain technical as well as market related insights through their publications such as research papers, blogs and press releases related to the studies are referred to get cues about the market. Further, white papers, journals, magazines, and other news articles published in the last 3 years are scrutinized and analyzed to understand the current market trends.

  1. Primary Research:

The primarily interview analysis comprise of data obtained from industry participants interview and answers to survey questions gathered by in-house primary team.

For primary research, interviews are conducted with industry experts/CEOs/Marketing Managers/Sales Managers/VPs/Subject Matter Experts from both demand and supply side to get a 360-degree view of the market. The primary team conducts several interviews based on the complexity of the markets to understand the various market trends and dynamics which makes research more credible and precise.

A typical research interview fulfils the following functions:

  • Provides first-hand information on the market size, market trends, growth trends, competitive landscape, and outlook
  • Validates and strengthens in-house secondary research findings
  • Develops the analysis team’s expertise and market understanding

Primary research involves email interactions and telephone interviews for each market, category, segment, and sub-segment across geographies. The participants who typically take part in such a process include, but are not limited to:

  • Industry participants: VPs, business development managers, market intelligence managers and national sales managers
  • Outside experts: Valuation experts, research analysts and key opinion leaders specializing in the electronics and semiconductor industry.

Below is the breakup of our primary respondents by company, designation, and region:

Research Methodology

Once we receive the confirmation from primary research sources or primary respondents, we finalize the base year market estimation and forecast the data as per the macroeconomic and microeconomic factors assessed during data collection.

  1. Data Analysis:

Once data is validated through both secondary as well as primary respondents, we finalize the market estimations by hypothesis formulation and factor analysis at regional and country level.

  • 3.1 Macro-Economic Factor Analysis:

We analyse macroeconomic indicators such the gross domestic product (GDP), increase in the demand for goods and services across industries, technological advancement, regional economic growth, governmental policies, the influence of COVID-19, PEST analysis, and other aspects. This analysis aids in setting benchmarks for various nations/regions and approximating market splits. Additionally, the general trend of the aforementioned components aid in determining the market's development possibilities.

  • 3.2 Country Level Data:

Various factors that are especially aligned to the country are taken into account to determine the market size for a certain area and country, including the presence of vendors, such as headquarters and offices, the country's GDP, demand patterns, and industry growth. To comprehend the market dynamics for the nation, a number of growth variables, inhibitors, application areas, and current market trends are researched. The aforementioned elements aid in determining the country's overall market's growth potential.

  • 3.3 Company Profile:

The “Table of Contents” is formulated by listing and analyzing more than 25 - 30 companies operating in the market ecosystem across geographies. However, we profile only 10 companies as a standard practice in our syndicate reports. These 10 companies comprise leading, emerging, and regional players. Nonetheless, our analysis is not restricted to the 10 listed companies, we also analyze other companies present in the market to develop a holistic view and understand the prevailing trends. The “Company Profiles” section in the report covers key facts, business description, products & services, financial information, SWOT analysis, and key developments. The financial information presented is extracted from the annual reports and official documents of the publicly listed companies. Upon collecting the information for the sections of respective companies, we verify them via various primary sources and then compile the data in respective company profiles. The company level information helps us in deriving the base number as well as in forecasting the market size.

  • 3.4 Developing Base Number:

Aggregation of sales statistics (2020-2022) and macro-economic factor, and other secondary and primary research insights are utilized to arrive at base number and related market shares for 2022. The data gaps are identified in this step and relevant market data is analyzed, collected from paid primary interviews or databases. On finalizing the base year market size, forecasts are developed on the basis of macro-economic, industry and market growth factors and company level analysis.

  1. Data Triangulation and Final Review:

The market findings and base year market size calculations are validated from supply as well as demand side. Demand side validations are based on macro-economic factor analysis and benchmarks for respective regions and countries. In case of supply side validations, revenues of major companies are estimated (in case not available) based on industry benchmark, approximate number of employees, product portfolio, and primary interviews revenues are gathered. Further revenue from target product/service segment is assessed to avoid overshooting of market statistics. In case of heavy deviations between supply and demand side values, all thes steps are repeated to achieve synchronization.

We follow an iterative model, wherein we share our research findings with Subject Matter Experts (SME’s) and Key Opinion Leaders (KOLs) until consensus view of the market is not formulated – this model negates any drastic deviation in the opinions of experts. Only validated and universally acceptable research findings are quoted in our reports.

We have important check points that we use to validate our research findings – which we call – data triangulation, where we validate the information, we generate from secondary sources with primary interviews and then we re-validate with our internal data bases and Subject matter experts. This comprehensive model enables us to deliver high quality, reliable data in shortest possible time.

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