Conversational AI Market (2024-2031)
The Conversational AI Market is projected to reach $54.1 billion by 2031 from an estimated $13.9 billion, at a CAGR of 23.9% from 2024 to 2031.
- Published
- Jul 2024
- Pages
- 238
- Format
- PDF + Excel
- Report ID
- MRICT - 104911
- Base year
- 2023
- 2031 · FORECAST
- $54.10B
- 2031
- $54.10B
- CAGR 2024–2031
- 23.9%
2023 baseline · 2024–2031 forecast at 23.9% CAGR · hover a bar for the value
Key highlights
The Conversational AI Market is projected to reach $54.1 billion by 2031 from an estimated $13.9 billion, at a CAGR of 23.9% from 2024 to 2031.
Moreover, the solutions segment is projected to register the highest CAGR during the forecast period.
The global conversational AI market is segmented into customer service, information technology service management, human resource management, sales and marketing management, operations and supply chain management, finance and accounting, and other applications.
In 2024, North America is expected to account for the largest share of over 37.0% of the global conversational AI market.
However, the market in Asia-Pacific is projected to register the highest CAGR of above 26.0% during the forecast period.
Report summary
| Particulars | Details |
|---|---|
| Number of Pages | 238 |
| Format | |
| Forecast Period | 2024–2031 |
| Base Year | 2023 |
| CAGR (Value) | 23.9% |
| Market Size (Value) | $54.1 Billion by 2031 |
| Segments Covered | By Offering · Solutions · Chatbots · Intelligent Virtual Assistants · Speech Recognition Solutions · Other Conversational AI Solutions · Services · Professional Services · Managed Services · By Application · Customer Services · Information Technology Service Management · Human Resource Management · Sales and Marketing Management · Operations and Supply Chain Management · Finance and Accounting · Other Applications · By Organization Size · Large Enterprises · Small & Medium-sized Enterprises · By Deployment Mode · Cloud-based Deployments · On-premise Deployments · By Sector · IT & Telecommunications · BFSI · Retail & E-commerce · Healthcare & Life Sciences · Travel & Hospitality · Education · Government & Public Sector · Media & Entertainment · Energy & Utilities · Manufacturing · Other Sectors |
| Countries Covered | North America (U.S., Canada), Europe (Germany, U.K., France, Italy, Spain, Netherlands, Rest of Europe), Asia-Pacific (China, Japan, South Korea, India, Singapore, and Rest of Asia-Pacific), Latin America (Brazil, Mexico, and Rest of Latin America), and the Middle East & Africa (UAE, Israel, Rest of the Middle East & Africa) |
| Key Companies | Google LLC (U.S.), Microsoft Corporation (U.S.), Amazon Web Services, Inc. (a subsidiary of Amazon.com, Inc.) (U.S.), Oracle Corporation (U.S.), International Business Machine Corporation (U.S.), NVIDIA Corporation (U.S.), Baidu, Inc. (China), Verint Systems Inc. (U.S.), SAP SE (Germany), AT & T Inc. (U.S.), Conversica, Inc. (U.S.), AssemblyAI, Inc.(U.S.), Kore.ai Inc. (U.S.), OpenAI OpCo, LLC (U.S.), and DRUID S.A. (Romania). |
Report overview
Segments covered: offering, application, organization size, deployment mode, sector. Regions: North America, Europe, Asia-Pacific, Latin America, Middle East & Africa.
The growth of the conversational AI market is driven by the surge in demand for conversational AI solutions to improve call center operations and the proliferation of voice-enabled devices. Furthermore, the high potential of AI-enabled voice assistants in the healthcare industry and the increasing proliferation of conversational AI solutions for sales and marketing management are expected to create growth opportunities for the players operating in the conversational AI market.
Report infographic
Market dynamics
3 factors across 2 forcesA Surge in Demand for Conversational AI Solutions to Improve Call Center Operations
Conversational AI solutions allow call centers to provide superior customer service. Conversational AI can enable individualized and efficient service by leveraging machine learning (ML) and natural language processing (NLP) technologies. AI-powered virtual assistants can understand customer needs, identify their problems, and provide relevant information to help them overcome the problems, enhancing customer experience. Chatbots can lower operational costs by offering a robust self-service channel to customers, making them essential for call centers. A call center chatbot understands and responds to real-time customer queries, providing relevant resolutions with minimal agent intervention. Chatbots can be programmed to suit business use cases such as collecting data or feedback.
Leading market players are focused on launching advanced products with added functionalities to increase their market shares. For instance, in September 2021, IBM Corporation (U.S.) announced that IBM’s virtual agent, Watson Assistant, was available with an add-on feature designed to connect to nearly every major contact center platform that uses the SIP protocol, including Genesys and NICE inContact, in as little as half an hour with no coding. Voice assistants built with Watson Assistant’s no-code interface can answer customer calls to help call centers increase their first-contact resolution rates, reduce hold times, and hand off calls to human agents when necessary.
Proliferation of Voice-enabled Devices
Technological advancements in AI are leading to transformation in industries, including automotive, healthcare, BFSI, retail, and IT & telecommunications. The emergence of smart technologies and the rising adoption of voice-enabled devices across industries are driving the integration of speech and voice recognition capabilities into smart solutions to improve user experience. According to Comscore, Inc. (U.S.), in 2021, smart speaker ownership hit an all-time high, with almost 50% of internet users owning at least one smart speaker. This ownership increased by 70% between 2019 and 2020. Moreover, according to Google Inc. (U.S.), 72% of people owning voice-activated speakers stated that their voice-enabled devices are a part of their daily routines. Thus, the proliferation of voice-enabled devices is boosting the utilization of conversational AI technology, driving the growth of this market.
Table of contents
13 chapters · 127 sections · 238 pages · click to expandSegmental analysis
| Segment | Largest share (2024) | Fastest growth (2024–2031) |
|---|---|---|
| By Offering | Solutions | — |
| Other segments | — | Solutions |
| By Application | Customer service | — |
| By Organization Size | Large market share of this | — |
| By Deployment Mode | Large market share of this | — |
| By Sector | Large market share of this | — |
By Offering
- The global conversational AI market is segmented into solutions and services.
- The solutions segment is expected to account for the largest share of over 76.0% of the global conversational AI market.
- The large market share of this segment is attributed to the increasing focus on solution-centric automation capabilities, the presence of multiple solution providers investing in R&D, and the growing adoption of conversational AI solutions in various industries.
Other segments
- Moreover, the solutions segment is projected to register the highest CAGR during the forecast period.
- The growth of this segment is driven by the increasing deployment of chatbots and digital assistants, a surge in demand for IVR systems, and initiatives by companies to launch speech recognition solutions and content management solutions.
- Moreover, the customer services segment is also projected to register the highest CAGR during the forecast period.
- The growth of this segment is driven by the increasing usage of conversational AI for payment management and the increasing need for conversational AI for order tracking and order updates.
- However, the small & medium-sized enterprises segment is projected to register the highest CAGR during the forecast period.
- The growth of this segment is driven by the increasing need for chatbots and digital assistants by small & medium-sized enterprises, the growing demand for IVR solutions by small-scale enterprises, notable benefits offered by chatbots for small & medium-sized enterprises, and the increasing need to improve performance, quality management, and customer satisfaction in call centers.
- Additionally, the cloud-based deployment segment is expected to register the highest CAGR during the forecast period.
- Additionally, the cloud-based deployment segment is expected to register the highest CAGR during the forecast period.
- The growth of this segment is driven by the increasing implementations of cloud-based conversational AI and ongoing efforts by companies to launch cloud-based chatbots and digital assistants.
By Application
- The global conversational AI market is segmented into customer service, information technology service management, human resource management, sales and marketing management, operations and supply chain management, finance and accounting, and other applications.
- The customer service segment is expected to account for the largest share of over 27.0% of the global conversational AI market.
- The large market share of this segment is attributed to the growing demand for digital assistants and chatbots in customer service for answering FAQs, increasing usage of AI-powered chatbots or virtual assistants for account management, rising need to analyze customer queries or statements, and conversational AI for multilingual support.
By Organization Size
- The global conversational AI market is segmented into large enterprises and small & medium-sized enterprises.
- The large enterprises segment is expected to account for a larger share of over 63.0% of the global conversational AI market.
- The large market share of this segment is attributed to the keen focus on developing strategic IT initiatives by large enterprises, the growing need to handle large volumes of customer-level data, early adoption of advanced technologies in retail, manufacturing, healthcare, and automotive sectors, and the growing need for better insights into customer responses.
By Deployment Mode
- The global conversational AI market is segmented into cloud-based deployment and on-premise deployment.
- The cloud-based deployment segment is expected to account for a larger share of above 67.0% of the global conversational AI market.
- The large market share of this segment is attributed to the rising demand for benefits such as easy maintenance of customer data, cost-effectiveness, scalability, and growing demand for conversational AI solutions for multi-cloud deployments.
By Sector
- The global conversational AI market is segmented into IT & telecommunications, BFSI, retail & e-commerce, healthcare & life sciences, travel & hospitality, education, government & public sector, media & entertainment, energy & utilities, manufacturing, and other sectors.
- The IT & telecommunications segment is expected to account for the largest share of over 28.0% of the global conversational AI market.
- The large market share of this segment is attributed to the increasing adoption of AI solutions for fraud detection and prevention, the surge in demand for conversational AI to improve call center operations, exerting efforts by companies to launch chatbots for IT service management, rising need for network optimization and maintenance.
- Additionally, the IT & telecommunications segment is expected to register the highest CAGR during the forecast period.
- Additionally, the IT & telecommunications segment is expected to register the highest CAGR during the forecast period.
- The growth of this segment is driven by the increasing implementation of chatbots and digital assistants to address different IT customer questions and the growing need to resolve IT service issues quickly.
Geographic analysis
North America
Largest shareIn 2024, North America is expected to account for the largest share of over 37.0% of the global conversational AI market. The large share of this regional market is attributed to the presence of prominent players offering advanced conversational AI solutions & services, the growing demand for AI-powered customer support services, the growing usage of chatbots to provide efficient customer services, the increasing adoption of voice-enabled devices, and increased technological advancement across the region encourage consumers to install conversational AI solutions & services.
Asia-Pacific
Fastest growthHowever, the market in Asia-Pacific is projected to register the highest CAGR of above 26.0% during the forecast period. The growth of this regional market is driven by companies' growing emphasis on launching chatbots and virtual assistants in the region, rising demand for chatbots and voice assistant solutions, and increasing demand for AI-powered customer support services.
Competitive landscape
- May 2023
Google Cloud, a cloud business unit of Google LLC (U.S.), launched new business models for generative AI. Generative AI has unleashed a new breed of digital assistants, content-creation tools, and applications. It has changed how apps are built, who can build them, and the capabilities end users expect from them.
- March 2023
Microsoft Corporation (U.S.) launched Microsoft Security Copilot, giving defenders a much-needed tool to quickly detect and respond to threats and better understand the threat landscape. Security Copilot will combine Microsoft’s vast threat intelligence footprint with industry-leading expertise to augment the work of security professionals through an easy-to-use AI assistant.
- Google LLC (U.S.)
- Microsoft Corporation (U.S.)
- Oracle Corporation (U.S.)
- International Business Machine Corporation (U.S.)
- NVIDIA Corporation (U.S.)
- Baidu, Inc. · China
- Verint Systems Inc. (U.S.)
- SAP SE · Germany
- AT & T Inc. (U.S.)
- Conversica, Inc. (U.S.)
- AssemblyAI
- Inc.(U.S.)
- Kore.ai Inc. (U.S.)
- OpenAI OpCo, LLC (U.S.)
- DRUID S.A. · Romania
Frequently asked questions
The Conversational AI Market refers to the industry focused on developing and implementing AI-powered technologies such as chatbots, virtual assistants, and voice-based AI systems that enable human-like conversations. These solutions use Natural Language Processing (NLP) and Machine Learning (ML) to understand and respond to user queries in real-time.
Cite this report
Meticulous Research. (2024). Conversational AI Market - Global Opportunity Analysis And Industry Forecast (2024-2031) (Report No. MRICT - 104911). Meticulous Market Research Pvt. Ltd. https://www.meticulousresearch.com/product/conversational-ai-market-5594