If you asked someone in 2019, “what do you think of chatbots?” you’d probably get mixed opinions, owing to the lack of openness to digitization. But the hardships of 2020 changed many perspectives. Chatbots worked miraculously amidst business closures in providing the right information to customers when they needed it. It has been an exceptional year for chatbots since the surge of technological tools was the only good that happened in an otherwise challenging year. According to Salesforce’s ‘State of Service’ report, 87% of customers used more digital channels during the pandemic. Automation was adopted more by businesses that were hesitant before. The chatbot penetration rates increased from 5% to 20% in 2019 to 50% in 2020.
This continued growth of the chatbot market is attributed to its simplicity and accessibility combined with the need for data-driven information from customers and enacting virtual communication. Both rule-based and AI chatbots dominate customer communications on the web, providing customers with a convenient method to reach out to companies regardless of the time/day.
Source: Mordor Intelligence
Understanding the Chatbot Market 2021
- The chatbot market was valued at $17.17 billion in 2020
- The top countries using chatbots are the USA, India, Germany, Brazil, and the UK
- The region experiencing the highest growth rate is Asia-pacific, followed by Europe and North America.
- The real-estate industry is profiting the most from chatbots, followed by travel, education, healthcare, and finance.
- Nearly 40% of internet users worldwide prefer interacting with chatbots to virtual agents. (Business Insider, 2021).
- The top use for a chatbot is providing quick answers in emergencies and the second most use was complaint resolution.
Artificial intelligence (AI) and Machine Learning (ML) have also been in the market for a while, offering communication advantages by understanding cognition and perception using Natural language Processing (NLP). It remains the top trend in enhancing cx using conversational marketing by allowing businesses to develop a brand persona and provide a personalized chat experience to the user via intent recognition and Dialog Management.
Chatbot: From the Business Perspective
- Chatbots are primarily helping for automating lead generation and customer support
- Chatbot use on messaging platform has grown tremendously, and messaging platforms will be the driver for the growth of chatbots
- Chatbots are also increasingly used for streamlining internal communication and workflows
- 64% of businesses feel that chatbots will allow them to provide personalized support to their customers (Statista)
- Chatbots save $0.7 per interaction for businesses
- 50% of companies are considering increasing their investments in chatbots
- Among companies that use a chatbot, 58% of them are B2B companies
- 53% of companies use bots within their IT departments, and 20% use them for providing customer service. (Research Aimultiple)
- Chatbots are projected to save 2.5 billion hours for businesses by 2023
- 77% of agents believe that since chatbots handle all the routine tasks, it gives them time to focus on complex queries. (Salesforce)
- 78% of agents mentioned that customers were increasingly using bots for self-service due to the pandemic.
- 66% of businesses feel chatbots reduce call volume significantly.
Chatbot: The consumer Experience
- 54% of customers are of the opinion that companies need to transform their customer communication (Salesforce)
- Consumers are demanding round-the-clock support, as a result of which the use of chatbots is surging across industries. More than 50% of consumers feel a business should be available 24/7 (VentureBeat)
- 86% of consumers think bots should always provide the option to transfer to a human representative (Aspect Customer Experience Index)
- 69% of respondents said they’d prefer chatbots for receiving instant responses (Cognizant)
Biggest chatbot trend 2021: Healthcare witnessing significant chatbot growth
- The average time that a patient spends trying to find out the right service that their local hospital can provide is 30 minutes and the nurse, on average, spends an hour trying to connect the patient to the right doctor. (Mordor Intelligence)
- Chatbots facilitate a seamless process for scheduling doctor appointments. Using conversational AI, bots can direct the right patient to the right doctor after understanding the symptoms and forwarding data to the doctor.
- The bots allow doctors to provide real-time diagnoses and prescriptions based on their conversation.
2020 was a big year for automated bots and AI-enabled tools for audience communication. In a pandemic-stricken world, health organizations like WHO and governments increasingly used automated bots to communicate important information to the masses. This included symptom analysis of Covid-19 through bots, information about testing centers, precautions, and future course of actions. As a result of such large bodies employing chatbots to communicate, hospitals and healthcare organizations started to do the same, amplifying the use of bots in the industry.
- According to Gartner, chatbots will see a rise of 100%, over the next two to five years, primarily because of their contribution to touchless consumer & employee interactions during the pandemic.
- Chatbots’ ability to stimulate human-like conversation using AI and Natural Language Processing is driving online customer engagement.
- The consumer retail spends via chatbot is predicted to increase to $142 billion in 2024 from just $2.88 billion in 2019 (Business Insider)
- Chatbots are expected to be more interactive and humane in their conversations.
- The cost savings from chatbot use will be $7.3 billion by 2023, up from $209 million in 2019
The paradigm shift of digitization this year was revolutionary, to say the least. Even the smallest retailer had to have some presence online not completely to disappear from the market. Businesses slowly but successfully are realizing that the role of AI and chatbots was never ‘to replace’ but ‘to assist.’ The future of chatbots looks promising as they are envisioned to become a standard practice amongst businesses to provide accurate information and customer service, facilitating a sophisticated virtual interactive experience.