CHATBOT
OVERVIEW &
OUTLOOK
MARKET OVERVIEW
CHATBOTS
Geographic Insights
USD 1.17 Billion in 2018 and is expected to
reach USD 10.08 Billion by year 2026,
growing at a CAGR of 30.9%
⬢ Covid-19 pandemic has accelerated
digitization and put a spotlight on AIpowered chatbots in the CRM (customer
relationship management) arena to assist
customers or engage with them through
personalized messaging/suggestions,
workflow automation & communication
platforms among others
⬢ Chatbot’s usage has expanded, and
companies are devising specialized
chatbots for functions including HR, IT,
Business Intelligence, etc.
⬢ North America is expected to be the leading region in
terms of adopting and developing conversational AI.
Growing investments in AI and ML technologies,
presence of maximum number of conversational AI
vendors, reduced operating cost and increasing
government spending on AI-based technologies are
expected to contribute to the market growth
⬢ The Over-the-Top (OTT) messaging application
segment such as Kik, Telegram, WhatsApp, Instagram
Messaging, Facebook Messenger and WeChat are
increasingly integrating chatbot features to catalyze
CRM and are expected to witness increased demand by
2021
MAJOR PLAYERS
⬢ The global Chatbot market was valued at
Segmental Insights
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CHATBOT ADOPTION
Going forward, Chatbot adoption could save healthcare, banking, and retail
sectors $11 billion annually by 2023
⬢ As per Gartner estimates, during 2021, more than 50% of enterprises will spend more per annum on bots and chatbot creation
than traditional mobile app development. Chatbots are projected to see over a 100% increase in their adoption rates in the next 2
to 5 years and currently presents leading AI use cases in enterprises. Gartner revised the bot’s penetration rate from 5% to 20% in
2019 to 20% to 50% in 2020
⬢ According to Outgrow 2020 survey, consumers prefer using chatbots versus a brand’s app. In 2019, the largest percentage of US
consumers engaged with a chatbot with retail (33%) and healthcare (22%), closely followed by utilities, entertainment, and
financial services
⬢ Vertical-wise, Chatbot adoption is expected to increase across FinTech, Healthcare, Law, Education, Governemnt and E-
commerce/Retail globally. Chatbots can be integrated into various channels such as websites, email, SMS, or messaging
applications through which users interact. They collect consumer data from support interactions and databases and provide a
personalized experience to the customer and employees
 At law firms and banks, chat is becoming a powerful medium for conducting research, which can eat up valuable billable hours or necessitate
hiring armies of associates. In 2017, JPMorgan Chase announced that its COiN bot was reviewing about 12,000 financial contracts every
year — saving about 360,000 hours’ worth of labor for lawyers and loan officers
 Specialized chatbots are also gaining traction in healthcare and wellness. Autonomous therapy bot Woebot, for instance, can pick up data
about users’ specific needs and, over time, use that information to offer a more personalized service. The bot exchanges 4.7M messages
with users every week
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CHALLENGES
Dearth of contextual data, lower RoI, skilled professionals and lack of
design thinking approach are major barriers for chatbot adoption at present
⬢
Initial hype of chatbot died out post 2016 when it gained maximum momentum
through new product launches and VC funds, but it did not reflect the same
penetration going forward
⬢
Lack of skilled labour, more than required involvement of internal IT teams to
solve issues with vendor, lack of available and contextual data to run ML/NLP,
integration of chatbots with client’s existing technologies, negligible RoI are
among major roadbloacks for Chatbot adoption
⬢
However, in 2020, mid- to late-stage deals accounted for half of all deals for the
first-time, suggesting maturity of technology and its applications. This is positively
driven by Covid-19 pandemic as organizations face a surge of inquiries while
adjusting to remote work – chatbots are being deployed to provide rapid
responses, cut down backlogs, and improve efficiencies.
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VENTURE CAPITAL
There is an increased venture capital funding activities post covid-19 till
present across FinChatBot, AI-enabled talent platform and conversational AI
Hyro, a leader in conversational AI solutions, today announced that it has closed a
$10.5 million Series A funding round led by Spero Ventures, with participation from
Established in 2016, FinChatBot is an AIthe leading cloud communications platform Twilio Inc. and Mindset Ventures,
powered chatbot for the financial
bringing the company’s total funding raised to date to $15 million
industry. Recently, the company has
secured £1.2 million from Saviu Ventures,
Barcelona-based Landbot, a “noa French investment holding company
Chat bot startup Ada Support Inc. raised financing at a
code” chatbot builder, has bagged
that focuses on African startups
$1.2 billion. Toronto-based Ada works with clients such as
an $8 million Series A funding
Facebook Inc. and Zoom Video Communications Inc. to
help them interact more efficiently with users through
automated chat boxes
NOV’20
JAN’21
DRUID, a company specialized in developing
intelligent virtual assistants (chatbots) for
Enterprise organizations, announces the attraction
of a new round of financing of 2.5 million dollars
MAY’21
JUN’21
Gloat an AI-enabled talent marketplace platform secured
US$57 in Series C funding. The company assists companies
in connecting their employees with development
opportunities like projects and mentorship programs
Cleo, the London-founded
“financial assistant” that takes
the form of an app and chatbot
and now counts the U.S. as its
largest market, has raised $44
million in Series B funding
Rasa, which has developed an
open source-based platform
for developers to build
chatbots, voice apps and other
services that employ
Eightfold AI is a talent-based intelligence platform conversational AI for
provider based out of California. In the Series E
interactivity raised $26 million,
funding round led by SoftBank Vision, with
a Series B round
participation from General Catalyst, Capital One
Ventures, Foundation Capital, IVP, and Lightspeed
Venture Partners, Eightfold AI raised US$220 million
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CHATBOT TRENDS
Messaging platform has become growth driver for Chatbots
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•
Messaging platforms have emerged as preferred communication channel among customers for receiving support as it can provide
instant information for a customer query. Going forward, companies will embrace messaging systems to improve customer
engagement and deepen customer loyalty with strong bot capabilities and an integrated approach over different business functions
Chatbots for HR and internal enterprise use
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•
In addition to managing customer requests effortlessly, chatbots have tremendous business value by streamlining internal business
processes across small business and large enterprises. HR Chatbots are now being used to manage employee’s momentum, address
essential HR-related questions, and complete transactional HR services (smart hiring etc.) in various organizations
•
Chatbots would become more prominent in the legal business operations. In the legal sector, chatbots can help with compliance queries,
across financial services or auditing operations, and linking legal departments with other parts of a larger enterprise. For lawyers,
chatbots are used as subject matter experts, quick response tools or as value-additive products for clients
Increased usage of Chatbots in Legal sector
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Greater adoption of Chatbots in Financial sector
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•
BFSI sector is utilizing chatbots for not only providing enhanced customer support but also for providing financial advice to its clients
through virtual agents. Used case are expanding in the space of fraud prevention, managing internal operations such as automating
repetitive back-office tasks, managing internal documentation etc. and promoting and cross-selling banking products
Conversational AI for effective marketing & sales
•
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CRM has become the largest application of Chatbots across industries, but most prominently in the retail sector. Right from notifying the
customers about products and promotions to providing insight about the shoppers, AI-chatbots are pervasive in retail. Studies have found
chatbots can answer 80% of standard questions, and 37% of people polled used customer service bots to get instant information
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STRATEGIES FOR CONSULTING/IT SERVICES
FIRMS
Partnership with Software Vendors
IT consulting firms can form strategic partnerships with
Software vendors, especially those who are related to
CRM to capture greater market share through joint
GTM* etc.
Recently, IBM, Amazon, Deloitte, DXC, and Accenture
partnered with UneeQ to drive the future of
conversational AI adoption
Strengthen cloud-based contact center service
Strengthen capabilities for cloud-based contact
center services and consulting can provide an edge to
IT firms. Partnerships with Microsoft for Anywhere365®
or with AWS for AWS Contact Center Intelligence (CCI)
solutions would be strategic
Leverage development capability to provide
No-code chatbots
As IT consulting firms have skilled professionals and
developers for low and no code development, it can
capitalize on the trend towards developing plug-and-play
chatbots for various industries
Consulting & Deployment Services
IT or management/innovation consultants can bridge the knowledgeskill gap between vendor and customer in the retail, financial,
healthcare and legal sector to build and deploy bots and other
digital solutions for cost-efficiency
Tin addition, there is a growing concern over ethical use of AI which
is lesser know to end customers. Therefore, consulting firms can
assist customers in building ethical Chatbots through defined
framework
Co-creation of Services with Customers
IT consulting and services firms can co-create AI-powered chatbot
services through design thinking principles that would
demonstrate greater value of chatbot technology adoption across the
firm
*Got-to-market
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ROADMAP
Chatbots are becoming intelligent with data toolsets and advancement in
NLP/ML which would create a promising market across healthcare, retail,
financial services & Government operations in 2021 and beyond
• Healthcare providers would leverage chatbots for triage
of patients, educate patients, and emulate the
core diagnostic and conversational functions of
•
a regular doctor visit. Public/ Govt. agencies would deploy
chatbots for effective & quick information
dissemination, claim assistance etc.
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•
CRM and workflows
Solutions providing deep analytics
toolset and resources such as best
practices, will be key to ensuring that
companies can use conversational AI to its
fullest potential
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• Adherence to security standards such as
ISO 27001 and EU-GDPR* would increase trust
among customers and end-users, therefore
there should be a focus on centrally managed
security framework that enables
The conversational AI market will
continue to gain momentum in 2021 and
beyond on the backdrop of automated
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management, monitoring, review and
improvement of information security
controls
•
*General Data Protection Regulation
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•
With proliferation of E-commerce, retail companies are
increasingly experimenting with chatbots for optimizing
customer journeys as it act as a virtual store concierge
From crawling financial documents to automating
repetitive tasks and managing personal finances,
chatbots are creating more efficient financial technology on
both the back and front ends of financial institutions
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THANKYOU
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