Chatbot Market Size, Share & Trends, Report

Chatbot Market Size, Share & Trends, Analysis Report By Application (Customer Services, Branding & Advertising), By Type, By Vertical, By Region (North America, Europe, Asia Pacific, South America), And Segment Forecasts, 2023 - 2030

  • Report ID: GVR-1-68038-598-4
  • Number of Pages: 132
  • Format: Electronic (PDF)
  • Historical Range: 2017 - 2021
  • Industry: Technology

Research Methodology

A three-pronged approach was followed for deducing the chatbot market estimates and forecasts. The process has three steps: information procurement, analysis, and validation. The whole process is cyclical, and steps repeat until the estimates are validated. The three steps are explained in detail below:

Information procurement: Information procurement is one of the most extensive and important stages in our research process, and quality data is critical for accurate analysis. We followed a multi-channel data collection process for chatbot market to gather the most reliable and current information possible.

  • We buy access to paid databases such as Hoover’s and Factiva for company financials, industry information, white papers, industry journals, SME journals, and more.
  • We tap into Grand View’s proprietary database of data points and insights from active and archived monitoring and reporting.
  • We conduct primary research with industry experts through questionnaires and one-on-one phone interviews.
  • We pull from reliable secondary sources such as white papers and government statistics, published by organizations like WHO, NGOs, World Bank, etc., Key Opinion Leaders (KoL) publications, company filings, investor documents, and more.
  • We purchase and review investor analyst reports, broker reports, academic commentary, government quotes, and wealth management publications for insightful third-party perspectives.

Analysis: We mine the data collected to establish baselines for forecasting, identify trends and opportunities, gain insight into consumer demographics and drivers, and so much more. We utilized different methods of chatbot market data depending on the type of information we’re trying to uncover in our research.

  • Market Research Efforts: Bottom-up Approach for estimating and forecasting demand size and opportunity, top-down Approach for new product forecasting and penetration, and combined approach of both Bottom-up and Top-down for full coverage analysis.

  • Value-Chain-Based Sizing & Forecasting: Supply-side estimates for understanding potential revenue through competitive benchmarking, forecasting, and penetration modeling.

  • Demand-side estimates for identifying parent and ancillary markets, segment modeling, and heuristic forecasting.

  • Qualitative Functional Deployment (QFD) Modelling for market share assessment.

Market formulation and validation: We mine the data collected to establish baselines for forecasting, identify trends and opportunities, gain insight into consumer demographics and drivers, and so much more. We utilize different methods of data analysis depending on the type of information we’re trying to uncover in our research.

  • Market Formulation: This step involves the finalization of market numbers. This step on an internal level is designed to manage outputs from the Data Analysis step.

  • Data Normalization: The final market estimates and forecasts are then aligned and sent to industry experts, in-panel quality control managers for validation.

  • This step also entails the finalization of the report scope and data representation pattern.

  • Validation: The process entails multiple levels of validation. All these steps run in parallel, and the study is forwarded for publishing only if all three levels render validated results.

Chatbot Market Categorization:

The chatbot market was categorized into seven segments, namely offering (Solution, Services), type (Standalone, Web-based, Messenger-based/Third Party), medium (Contact Centers, Websites, Social Media, Mobile Applications), business function (IT Services, HR Services, Sales & Marketing, Finance), application (Customer Services, Branding & Advertising, Personal Assistance, Data Privacy & Compliance, Payment Processing), vertical (Healthcare, Retail & E-commerce, BFSI, Media & Entertainment, Travel Tourism, Transportation & Logistics), and region (North America, Europe, Asia Pacific, South America, and Middle East & Africa).

Segment Market Methodology:

The chatbot market was segmented into offering, type, medium, business function, application, vertical, and region. The demand at a segment level was deduced using a funnel method. Concepts like the TAM, SAM, SOM, etc., were put into practice to understand the demand. We at GVR deploy three methods to deduce market estimates and determine forecasts. These methods are explained below:

Market research approaches: Bottom-up

  • Demand estimation of each product across countries/regions summed up to from the total market.

  • Variable analysis for demand forecast.

  • Demand estimation via analyzing paid database, and company financials either via annual reports or paid database.

  • Primary interviews for data revalidation and insight collection.

Market research approaches: Top-down

  • Used extensively for new product forecasting or analyzing penetration levels.

  • Tool used invoice product flow and penetration models Use of regression multi-variant analysis for forecasting Involves extensive use of paid and public databases.

  • Primary interviews and vendor-based primary research for variable impact analysis.

Market research approaches: Combined

  • This is the most common method. We apply concepts from both the top-down and bottom-up approaches to arrive at a viable conclusion.

Regional Market Methodology:

The chatbot market was analyzed at a regional level. The globe was divided into North America, Europe, Asia Pacific, South America, and Middle East & Africa, keeping in focus variables like consumption patterns, export-import regulations, consumer expectations, etc. These regions were further divided into nine countries, namely, the U.S.; Canada; Mexico; the UK; Germany; China; South Korea; Japan; Brazil.

All three above-mentioned market research methodologies were applied to arrive at regional-level conclusions. The regions were then summed up to form the global market.

Chatbot market companies & financials:

The chatbot market was analyzed via companies operating in the sector. Analyzing these companies and cross-referencing them to the demand equation helped us validate our assumptions and conclusions. Key market players analyzed include:

  • Baidu, Inc. - Baidu, Inc. is a Chinese internet company founded in 2000 and headquartered in China. The company offers a variety of services to its users, allowing them to access information through different channels. One of these services is Baidu PostBar, which enables users to conduct basic information searches and share knowledge. All of Baidu's applications are in Chinese and are widely used by the Chinese population. Baidu is a publicly listed company traded on the Nasdaq Stock Exchange under the symbol NASDAQ: BIDU. With over fifty services available, Baidu provides its users various applications, including Baidu Baike, an online encyclopedia similar to Wikipedia. Baidu Music, another service provided by the company, has more than 150 million users. In October 2016, Baidu introduced Melody, an innovative healthcare bot that utilizes artificial intelligence to offer text-based medical care. Melody asks patients preliminary questions and gathers information from online sources such as research papers and forums. For example, if a user informs Melody that a child is sick, it may inquire about the presence of a fever and follow up with additional questions. Baidu has spearheaded the artificial intelligence movement in China and is expected to lead it through its unique combination of data, technology, and talent.

  • Poncho, Inc. - Poncho, a mobile application for weather forecasting, offers personalized weather reports every morning that can be tailored to the user's daily routine. This application provides real-time weather updates to its users. For example, if the app detects rain through an online update, it will notify the user to bring an umbrella or a coat. The company is based in New York and was founded in 2013. In April 2016, they successfully raised USD 2 million to develop artificial intelligence and data science technology. Subsequently, in 2017, Iris Nova Ltd acquired the company.

  • Kik Interactive Inc. - Kik is a chat platform specifically designed for teenagers. Its inception in 2009 was driven by the aim of shifting the focus of computing from PCs to mobile phones. Founded by a small group of students studying at the University of Waterloo in Canada, Kik now boasts a team of over 100 employees dedicated to developing a mobile chat application that facilitates connections between users, services, and businesses. The company has secured a total funding of USD 220.5 million from various venture capitalists and angel investors. Notably, Kik has also introduced a new platform called Bot Shop, which functions similarly to the Google App Store but exclusively for chatbots. Through Bot Shop, users can engage in conversations with chatbots created by partnered companies such as H&M, The Weather Channel, and Sephora. These companies perceive Kik as a valuable platform for customer interaction on social media and for gathering market insights by directly accessing user data.

  • WeChat - WeChat, developed by Tencent Inc., is a mobile messaging application that serves as a social media platform, allowing users to engage in instant messaging, payment services, and m-commerce. Originally known as 'Weixin,' it was initially launched in China in 2011. As the user base reached 100 million in 2012, Weixin was rebranded as WeChat for the international market. In September 2018, the combined monthly users of Weixin and WeChat were reported to be 1,052.5 million, marking a 10.5% increase from the previous year. Additionally, WeChat offers a digital marketing platform in China. Users can conveniently order and pay for taxis within the application, although this feature is currently limited to China.

  • Varo Money Inc. - Varo Money Inc. is a company based in the United States that offers a comprehensive mobile banking application. The company's mobile app, called 'Varo,' allows users to conveniently pay bills, manage expenses, and grow their wealth. With Varo, users can effectively monitor their cash flow and track their spending across all their savings and credit card accounts. In 2017, the company introduced 'Val,' a mobile banking chatbot. Varo stands out from other financial institutions by providing a user-friendly experience with features like no minimum balance fees, no overdraft fees, and no ATM fees. The application was developed in 2015 to improve customers' financial outcomes. To date, Varo has successfully raised investments totaling USD 78.4 million. Notable investors in the company include The Rise Fund, Silicon Valley Bank, and Warburg Pincus LLC.

  • Babylon - Babylon is a healthcare service provider that operates on a subscription-based model. It offers its users a convenient virtual consultation experience with doctors through video and text messaging on its mobile applications. This innovative service allows users to receive prescriptions, schedule health exams, and obtain referrals to specialized healthcare professionals. By integrating artificial intelligence technology with the medical expertise of doctors, Babylon ensures a comprehensive and personalized healthcare experience. The company has recently partnered with TELUS, Tencent Inc., and Samsung to expand its services to different industries. Additionally, Babylon offers end-to-end clinical services in the United Kingdom, Canada, and Rwanda.

  • MessageYes (formally known as ReplyYes) - ReplyYes is a mobile messaging platform designed for e-commerce brands to interact and conduct customer transactions effectively. By utilizing a combination of artificial intelligence and human assistance, the application is able to provide a personalized and tailored experience to each customer. Through analyzing customer feedback, ReplyYes continuously learns and adapts to understand better and meet the preferences and choices of its users. This platform not only assists customers in selecting products based on their preferences but also facilitates direct and meaningful two-way conversations between brands and their clients, thereby enhancing customer engagement. Founded in 2015 and headquartered in Washington, U.S., ReplyYes has successfully secured funding of USD 6.5 million from a range of seed investors and venture capitalists.

  • SRI International - SRI International, a nonprofit organization and independent research center based in the United States, was established in 1946. In 1977, it separated from Stanford University and became known as Stanford Research Institute (SRI) International. The organization specializes in providing cutting-edge solutions in technological advancements such as interactive computing and artificial intelligence. Through their research and innovation, SRI International has contributed to the development of new products and industries that have had a significant impact on people's daily lives. They market innovations through technology licensing, new product solutions, and spin-off ventures. SRI International offers services to various industries, including biosciences, health, medical systems, materials, computing and information technology, defense and security, education and learning, robotics, sensors, and devices. One of their notable achievements is the creation of Kasisto (KAI), a conversational artificial intelligence platform that powers smart bots and virtual assistants on mobile, web, messaging, and wearables. Kasisto incorporates the company's artificial intelligence technologies, including natural language understanding, speech recognition, and artificial intelligence reasoning. Financial institutions widely embrace Kasisto as an innovative solution for enhancing customer experience by promptly addressing their requests, solving problems in real-time, and predicting consumer needs through KAI bots and assistants. Notable investors in the company include Scotty Labs, Hello Curry, Trapit, Tempo AI, and Siri.

  • Pefin Inc. - Pefin Inc. is a company that specializes in providing AI-enabled financial planning, advisory, and investment services to individuals who invest online. The company operates through its wholly-owned subsidiary, Pefin Advisors, LLC, which is an investment firm offering financial planning, portfolio management, and investment advisory services. Using artificial intelligence technology, Pefin Inc. can provide its users with valuable data for making informed financial decisions. Additionally, the company offers personalized investment strategies and plans that adapt to the changing circumstances in the user's life and economic ecosystem. Pefin Inc. conducts its business operations in the United States and Australia. The company's AI-based financial planning product is currently in beta testing and utilized by approximately 4,000 to 5,000 users. Furthermore, Pefin Inc. expanded its services to the Netherlands by the end of 2019, intending to enter 6 to 8 countries across the Asia Pacific and Europe within the next two years.

  • Wealthfront Corporation - Wealthfront Corporation, previously known as Wealthfront Inc., is an automated investment advisory firm primarily catering to corporations, high-net-worth individuals, and charitable organizations. The firm offers various wealth management services, including financial planning, investment strategies, and consulting. It invests in public equity, mutual funds, exchange-traded, and fixed-income funds. Operating in over 40 states in the U.S., the company serves its products to a vast clientele. Wealthfront Advisers LLC, a wholly-owned subsidiary, is a registered investment advisory firm regulated by the SEC. The company has established a strong presence in the industry with a client base exceeding 200,000 individuals and over a thousand high-net-worth clients.

Value chain-based sizing & forecasting

Supply Side Estimates

  • Company revenue estimation via referring to annual reports, investor presentations, and Hoover’s.

  • Segment revenue determination via variable analysis and penetration modeling.

  • Competitive benchmarking to identify market leaders and their collective revenue shares.

  • Forecasting via analyzing commercialization rates, pipelines, market initiatives, distribution networks, etc.

Demand side estimates

  • Identifying parent markets and ancillary markets

  • Segment penetration analysis to obtain pertinent

  • revenue/volume

  • Heuristic forecasting with the help of subject matter experts

  • Forecasting via variable analysis

Chatbot Market Report Objectives:

  • Understanding market dynamics (in terms of drivers, restraints, & opportunities) in the countries.

  • Understanding trends & variables in the individual countries & their impact on growth and using analytical tools to provide high-level insights into the market dynamics and the associated growth pattern.

  • Understanding market estimates and forecasts (with the base year as 2022, historic information from 2017 to 2021, and forecast from 2023 to 2030). Regional estimates & forecasts for each category are available and are summed up to form the global market estimates.

Chatbot Market Report Assumptions:

  • The report provides market value for the base year 2022 and a yearly forecast till 2030 in terms of revenue/volume or both. The market for each of the segment outlooks has been provided on region & country basis for the above-mentioned forecast period.

  • The key industry dynamics, major technological trends, and application markets are evaluated to understand their impact on the demand for the forecast period. The growth rates were estimated using correlation, regression, and time-series analysis.

  • We have used the bottom-up approach for market sizing, analyzing key regional markets, dynamics, & trends for various products and end-users. The total market has been estimated by integrating the country markets.

  • All market estimates and forecasts have been validated through primary interviews with the key industry participants.

  • Inflation has not been accounted for to estimate and forecast the market.

  • Numbers may not add up due to rounding off.

  • Europe consists of EU-8, Central & Eastern Europe, along with the Commonwealth of Independent States (CIS).

  • Asia Pacific includes South Asia, East Asia, Southeast Asia, and Oceania (Australia & New Zealand).

  • Latin America includes Central American countries and the South American continent

  • Middle East includes Western Asia (as assigned by the UN Statistics Division) and the African continent.

Primary Research

GVR strives to procure the latest and unique information for reports directly from industry experts, which gives it a competitive edge. Quality is of utmost importance to us, therefore every year we focus on increasing our experts’ panel. Primary interviews are one of the critical steps in identifying recent market trends and scenarios. This process enables us to justify and validate our market estimates and forecasts to our clients. With more than 8,000 reports in our database, we have connected with some key opinion leaders across various domains, including healthcare, technology, consumer goods, and the chemical sector. Our process starts with identifying the right platform for a particular type of report, i.e., emails, LinkedIn, seminars, or telephonic conversation, as every report is unique and requires a differentiated approach.

We send out questionnaires to different experts from various regions/ countries, which is dependent on the following factors:

  • Report/Market scope: If the market study is global, we send questionnaires to industry experts across various regions, including North America, Europe, Asia Pacific, Latin America, and MEA.

  • Market Penetration: If the market is driven by technological advancements, population density, disease prevalence, or other factors, we identify experts and send out questionnaires based on region or country dominance.

The time to start receiving responses from industry experts varies based on how niche or well-penetrated the market is. Our reports include a detailed chapter on the KoL opinion section, which helps our clients understand the perspective of experts already in the market space.

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