"Smart Strategies, Giving Speed to your Growth Trajectory"

Chatbot Market Size, Share & COVID-19 Impact Analysis, By Component (Platform/Software Development Kit and Services), By Deployment (Cloud and On-premises), By Application (Website, Contact Centers, Social Media and Mobile Application), By Industry (Banking, Financial Services and Insurance (BFSI), Retail and ecommerce, Information Technology (IT) and Telecom, Media and Entertainment, Healthcare and Others and Regional Forecast, 2020-2027

Last Updated: May 06, 2024 | Format: PDF | Report ID: FBI104673



Play Audio Listen to Audio Version

The global chatbot market size was valued at USD 396.2 million in 2019 and is projected to grow from USD 396.2 million in 2019 to USD 1,953.3 million in 2027, exhibiting a CAGR of 22.5% during 2020-2027 period. The global impact of COVID-19 has been slightly unpredictable, with chatbots witnessing a diverse demand across all regions during the pandemic. The unexpected drop in CAGR is owing to the overall market demand and growth of chatbot services in SMEs across developing nations.

The adoption of chatbots is mainly driven by the advancement of artificial intelligence (AI) technology and the increasing number of retail and e-commerce worldwide. The rising market demand for a chatbox platform based on a natural language processing (NLP) engine across social media is further considered as one of the key factors driving the market. According to Facebook, Inc., in 2018, there were around 300,000 bots on Facebook.

Organizations adopt messaging platforms and services to automate their business process, recommend products and services to their users, advance marketing engagement, predict the buying behavior of users, cost reduction, and others.

Key companies in the market are focusing on adopting several business strategies by investing in terms of completing strategic mergers, partnerships, collaboration, product launch, and others. For instance, in January 2019 – IBM Corporation collaborated with Ingenico Group, a European company, to develop and launch IBM Watson-enabled virtual bot. The service is enabled with AI and natural language processing (NLP) engines to provide an enriched experience for their users.

Rise of Chatbots Amidst COVID-19

COVID-19 pandemic has impacted every industry worldwide. Perceiving numerous initial results from the first quarter of 2020, an insignificant drop can be seen in global demand. Similarly, owing to COVID 19, several business strategies and tactics are expected to be on hold owing to a lack of operations. The upcoming prospect for the market size in the imminent second half of 2020 and beyond remains uncertain.

As the COVID-19 pandemic continues, it has created numerous market restraints for both platform providers and end-users. However, the overall market is estimated to grow with considerable CAGR during the chatbot industry forecast period. The growth in the market size is owing to the growing investment across the countries, which are less affected by COVID 19. For instance, according to Invest India.gov, in May 2020, the government of India invested around USD 265 million (20 lakh crore) as an Economical Package. The investment was completed to develop all types of enterprises across industries such as agriculture, manufacturing, and healthcare. With this investment, several SMEs and startups are likely to adopt conversational bots services in their business units to expand their business.

The rising funding in terms of business strategies such as product launch, mergers, acquisition, and others is anticipated to lead to the market showcasing substantial growth during the forecast period.


Request a Free sample to learn more about this report.

Rising Adoption of Cloud-based Conversational Bots by Large Enterprises to Drive Market

Prominent players in the market such as IBM Corporation, Unibot, Google Inc., and others, are focused on developing conversational bots. These conversational bots are enabled with cloud-based natural language processing (NLP) engine. Conversational bots assist users in interacting with online web services with interactive text, live chat, audio, graphics, and task modules. End users are focused on adopting advanced conversational bot solutions based on cloud in their businesses to increase their productivity. According to Oracle Corporation, around 80% of large organizations are currently using or planning to adopt bot services in their business by the end of 2020. Besides, according to a survey done by Facebook Inc., about 50% of the users are likely to shop by connecting over a conversational bot.

In the current scenario, several startups such as Root Info Solutions, Octane.ai, OnGraph Technologies, Chatbots Studio, and others are investing in developing advanced conversational bots. For instance, in 2016, Octane.ai invested around USD 1.5 million for the development of conversational bots based on the graphical user interface (GUI). Players such as Kiehls, Warner Music Group, and others adopted these bots. The advancement of cloud-based conversational bots is considered one of the emerging trends for the global chatbot market growth.


Advancement of Artificial Intelligence (AI) and Rising Number of SMEs to Drive Market Growth

The global market is mainly driven by the advent of artificial intelligence (AI) technology and the rising adoption of chatbots across industries. Industries such as retail & e-commerce, government, media & entertainment, travel, and transportation are highly adopting messenger bots in their business. Bots based on AI are used for establishing an interactive conversation with end-user and offer them enhanced customer engagement services.

AI-based messenger bot offers organizations to save up a huge amount of cost associated with marketing and sales applications. For instance, in 2018, according to IBM Corporation, every year, around 265 million end-user requests are recorded for sales inquiries. The Organization invests about USD 1.3 trillion to address these sales demands. With the adoption of the messaging platform, organizations can save up to 30% of the cost.

With the rising number of SMEs providing AI bots, the industry is estimated to rise during the forecast period. Several SMEs are developing advanced messenger bots services for messaging applications to provide a better customer experience and resolve client queries. For instance, in May 2018, eGain Corporation developed and launched Solve, a solution for Amazon Connect (based on Amazon Web Services (AWS) cloud infrastructure). The solution assists in improving the consumer experience through immediate resolution of first level queries.


Significant Conversational Gaps and Security Breaches to Hamper Growth

Organizations adopt virtual assistants such as bots in their business units to advance marketing engagement, increase brand awareness, provide customer support and end-to-end solutions. However, providing several benefits to users, these services have few market restraints. These market restraints are security breaches and conversational gaps such as misinterpretation of requests, executing incorrect commands, and difficulty sensing and understanding the accents of users. The bots are still not proficient in understanding human accents to develop precise intent.

Owing to these restraints, market demand is expected to hinder in the forthcoming period. Key players in the industry are focused on developing advanced messenger bots based on AI analytics and algorithms. The advanced messenger bots based on AI would help overcome the challenges related to security breaches and various conversational gaps.


By Component Analysis

Rising Internet Penetration Backed by SMEs Adoption of Virtual Messaging Services to Drive Market Growth

Based on the type of component, the market is divided into platform/software development kit (SDK kit) and services.

Among the segments, the platform/software development kit is expected to lead the market during the forecast period. The market growth is mainly driven owing to an increasing number of SMEs adopting messenger bots in their business units. SMEs adopt bots to increase their sales revenue and customer support by providing users with online chat services. According to 2018 State of Chatbots Reports, around 38% of online users communicate for business with online chat services and 15% with bot services. In addition to this, the instant response rate of users while using messenger bots was around 75%, as compared with the telephone with 60%, email with 27%, and web form with 30%.

The services segment is expected to grow with considerable CAGR during the forecast period. This is attributable to the rising adoption of messenger bots across industries such as travel and tourism, government, transportation, retail, etc. Key players are investing in offering bots services to their users to chat online to initiate the business.

By Deployment Analysis

Rising Investment for Development of Cloud Platform to Boost Segment Growth

Based on the deployment, the market is divided into the cloud and on-premise.

Among all these segments, the cloud segment is expected to lead the market during the forecast period. The segmental growth is primarily driven by the rising investment from the key players for the development of bot technology based on cognitive and AI systems. According to the International data corporation (IDC), in 2018, overall investment by key players in AI and cognitive systems stood at around USD 24 million. In addition to this, the overall investment is expected to reach around USD 77 million by 2022.

The on-premises segment is expected to grow with a decent CAGR during the forecast period. The growth is owing to the fact that SMEs prefer affordable services by adopting on-premises solutions in their business units. On-premises services offer organizations to automate their business process while assisting in recommending products to users and others.

By Application Analysis

To know how our report can help streamline your business, Speak to Analyst

Increasing Popularity of Messenger Bots based on Cloud Services among SMEs and E-commerce to Drive the Market

Based on the application, the market is divided into websites, contact centers, social media, and mobile applications.

Among all these segments, the website is expected to lead the market during the projected horizon. The growth is predominantly driven by the rising number of SMEs shifting towards adopting bots services based on the cloud. SMEs are investing by adopting bot services based on cloud service. Accordingly, key players are developing and launching advanced bot services based on cloud service to cater to the rising demand across sectors including government, education, and retail. For instance, in March 2018, Clustaar Chatbot Solution, a France based company, invested around USD 1.8 million to develop Clustaar, a messenger bot platform. This platform is deployed across various sectors including banking, insurance, fintech, travel, retail, government, and tech organizations.

The social media segment is expected to rise with considerable CAGR during the forecast period. The bots are increasingly deployed in various social messaging applications to provide one-to-one encrypted conversions and deliver enriched customer service. With the rising number of social media users such as Facebook, Twitter, and others, the market demand is expected to increase. For instance, Facebook messenger recorded around 2 million monthly active users in the first quarter of 2018. Similarly, Whatsapp reported more than 1.3 million active users in the first quarter of 2018.

By Industry Analysis

Increasing Deployment of Messenger Bots across Healthcare, BFSI and other Industries to Augur Growth

Based on the industry, the market is divided into banking, financial services and insurance (BFSI), retail and e-commerce, information technology (IT) and telecom, media and entertainment, healthcare, and others (government and education).

Among all these segments, healthcare is estimated to grow with a substantial CAGR during the forecast period. This is attributable to the rising adoption of bot services among healthcare and medical sectors. In the healthcare industry, these online services aid in delivering health-related information to the users, setting up appointments with the doctors and surgeons, and provide a diagnosis (opinion) to the patients. Key companies are focused on developing advanced customized conversation bots to cater to the healthcare industry. For instance, in June 2018, Babylon Inc. launched Babylon Chatbot. The company claimed that the bot had surpassed the average score of human doctors on the Membership of the Royal College of General Practitioners Exam.

Industries such as BFSI, retail & ecommerce, and government are expected to grow with a significant CAGR during the forecast period. The growth is mainly owing to the rising investment done by key players by launching products, completing various mergers, partnerships, and others.


North America Chatbot Market Size, 2019 (USD Million)

To get more information on the regional analysis of this market, Request a Free sample

The global market is divided into five regions, including North America, Asia Pacific, Europe, Middle East & Africa, and Latin America.

Among all the regions, North America is estimated to lead the market and grow with a substantial CAGR during the forecast period. The market size is primarily owing to the presence of major players such as Microsoft Corporation, IBM Corporation, Amazon Web Inc., Livechat Inc., and others. These players are focused on completing various business strategies such as product launches to expand their presence worldwide. Besides, key players are focused on developing a messenger bot platform based on AI and NLP engines.

For instance, in July 2018, IBM Corporation launched Watson Tone Analyzer technology for messaging bots. This technology is based on AI and helps bots connect emotionally with humans by monitoring their behavior response. Furthermore, major players in the US such as KLM Dutch Airlines, Spotify, Starbucks, and Bank of America have invested in deploying advanced messenger bots in their business units to offer a seamless experience to their users.

Europe is expected to grow with considerable CAGR during the forecast period. The region held a significant market share in terms of revenue in 2019. The growth is primarily owing to the increasing investment made by the government and major players by adopting bot services. For instance, in April 2019, the government of the United Kingdom announced to deploy bots in their government websites to negotiate deals between the UK and the rest of European countries. In January 2018, SAP SE acquired Recast.AI, France based virtual bot Provider Company, and named it SAP Conversational AI. The company provides platforms such as bot training, bot builder, bot connector, and bot analytics.

Asia Pacific is expected to grow with the highest CAGR during the forecast period. Emerging countries such as India, Japan, Korea, Indonesia, and others will support market growth. The growth in the region is owing to the rising investment done by startups and local governments for the development of technologies driving messenger bots such as AI, NLP, and others. In addition, SMEs adopt conversational bots services in their customer service process to deliver unified customer services to its users. For instance, in June 2018, Singapore Life, a Singapore-based insurer company, developed a self-learning bot based on advanced AI analytics and algorithms. With the help of this platform, users can access the product offering through social media applications such as Facebook and Instagram.

The rising internet penetration and the increasing number of providers in the Middle East and Africa, and Latin America is expected to drive the market size. In addition to this, the high investment in the retail and healthcare industry and the surging number of conversational bots offerings would assist in boosting the market growth. For instance, In March 2018, Labiba for Artificial Intelligence LLC., launched a bot-building platform, version 2.0. This platform assists users in developing and improves the smart conversational user experience. Similarly, in June 2018, the company launched a ticket delivery and customer support bot. In addition, in May 2018, the company launched “fan engaging chatbots” for the media and entertainment sectors.


Sap SE, Microsoft Corporation, and Others Focus on Adoption of Business Strategies to Maintain Dominance

Amazon Web Services, Inc. operates in three business segments North America, International and, AWS. The company is an online retailer with a vast range of products. The company also offers web-based payment, personalized shopping services, and direct shipping.

The company offers Amazon Lex, a bot service in its product offering. AWS users are benefited from various services such as receiving alerts and notifications, operating commands to diagnose information, appeal for AWS Lambda functions and develop customized AWS support cases. Further, the company is currently focused on investing by adopting various business strategies such as product launches, mergers, and partnerships. For instance, in February 2020, Amazon is testing a bot based on the AI engine that monitors and understands users' queries and generates original dialogue in real-time.


  • Amazon Web Services, Inc. (Washington, United States)

  • Google LLC (California, United States)

  • IBM Corporation (New York, United States)

  • Microsoft Corporation (Washington, United States)

  • SAP SE (Germany)

  • Yellow Messenger (Karnataka, India)

  • Labiba for Artificial Intelligence LLC (Dubai, United Arab Emirates)

  • Gupshup (Maharashtra, India)

  • SmartBots (Texas, United States)

  • Aivo (Córdoba, Spain)

  • Aifa.AI (Sydney, Australia)

  • Dogtown Media. (California, United States)

  • Peerbits. (Gujarat, India)

  • Master of Code Global. (California, United States)

  • Peltarion (Stockholm, Sweden)

  • Verloop (Karnataka, India)

  • Crisp IM SARL (France)

  • LiveChat, Inc. (Massachusetts, United States)

  • ManyChat, Inc. (San Francisco, United States)

  • Chatfuel (San Francisco, United States)

  • PandoraBots (California, United States)

  • Botscrew (London, UK)


  • June 2020 – Solvvy Inc. launched its Conversational Concierge, a Next-Gen Chatbot Platform. This platform assists large enterprises to effortlessly provide intelligent, customization, and on-brand support and services to their users across channels.

  • May 2017 – Cisco System acquired MindMeld, a US-based company providing artificial intelligence (AI) solutions. The acquisition is aimed to develop and offer virtual assistant bots, and voice assistants enabled with AI domain intelligence.

  • August 2017 – LogMeIn, Inc. acquired Nanorep, a prominent virtual assistant provider company. The acquisition aims to develop bots based on Nanorep’s artificial intelligence (AI) and natural language processing (NLP) technologies.


An Infographic Representation of Chatbot Market

To get information on various segments, share your queries with us

The market report overviews major leading regions across the world to provide an enhanced understanding of the user. Also, the report offers detailed insights into the latest chatbot market trends and examines technologies that are being deployed at a rapid pace at the global level. The report additionally highlights the growth-stimulating factors and restraints, assisting the reader to gain in-depth knowledge about the market.




Study Period


Base Year


Forecast Period


Historical Period



  Value (USD million)


  Component; Deployment; Application; Industry and Region

By Component

  • Platform/SDK Kit

  • Services

By   Deployment

  • On-Premises

  • Cloud

By Application

  • Website

  • Contact Centers

  • Social Media

  • Mobile Application

By Industry

  • Banking, Financial Services and Insurance (BFSI)

  • Retail and ecommerce

  • Information Technology (IT) and Telecom

  • Media and Entertainment

  • Healthcare

  • Others (Government and Education)

By Region

  • North America (By Component; Deployment; Application; Industry and Country)

    • United States (By Application)

    • Canada (By Application)

  • Latin America (By Component; Deployment; Application; Industry and Country)

    • Brazil (By Application)

    • Mexico (By Application)

    • Rest of South America

  • Europe (By Component; Deployment; Application; Industry and Country)

    • United Kingdom (By Application)

    • Germany (By Application)

    • France (By Application)

    • Italy (By Application)

    • Spain (By Application)

    • Rest of Europe

  • The Middle East & Africa (By Component; Deployment; Application; Industry and Country)

    • GCC (By Application)

    • South Africa (By Application)

    • Rest of the Middle East & Africa

  • Asia Pacific (By Component; Deployment; Application; Industry and Country)

    • China (By Application)

    • Japan (By Application)

    • India (By Application)

    • South East Asia (By Application)

    • Rest of Asia Pacific

Frequently Asked Questions

Fortune Business Insights says that this market stood at USD 396.2 million in 2019.

Fortune Business Insights says that the market is expected to reach USD 1,953.3 million in 2027.

The market is expected to rise at a CAGR of 22.5% during the forecast period (2019-2027)

Within the industry segment, the healthcare segment is expected to grow with the highest CAGR during the forecast period

The adoption of bots is mainly driven by the advancement of artificial intelligence (AI) technology and the rising number of retail and e-commerce worldwide.

Amazon Web Services, Inc., Microsoft Corporation, SAP SE, and IBM Corporation are the top companies in the market.

The cloud segment is expected to grow at the highest CAGR during the forecast period.

The revenue of the market in North America in 2019 was USD 156.7 million.

Seeking Comprehensive Intelligence on Different Markets?
Get in Touch with Our Experts

Speak to an Expert
  • 2019-2032
    (In Process)
  • 2023
    (In Process)

Personalize this Research

  • Granular Research on Specified Regions or Segments
  • Companies Profiled based on User Requirement
  • Broader Insights Pertaining to a Specific Segment or Region
  • Breaking Down Competitive Landscape as per Your Requirement
  • Other Specific Requirement on Customization
Request Customization Banner

Client Testimonials

“We are quite happy with the methodology you outlined. We really appreciate the time your team has spent on this project, and the efforts of your team to answer our questions.”

- One of the largest & renowned medical research centers based in the U.S. on a report on the U.S. NIPT Market.

“Thanks a million. The report looks great!”

- Feedback from a consultant on a report on the U.S. Beef Market.

“Thanks for the excellent report and the insights regarding the lactose market.”

- Brazil based company specializing in production of protein ingredients.

“I liked the report; would it be possible to send me the PPT version as I want to use a few slides in an internal presentation that I am preparing.”

- Global Digital Services Agency on a report on the Global Luxury Goods Market.

“This report is really well done and we really appreciate it! Again, I may have questions as we dig in deeper. Thanks again for some really good work.”

- U.S.-based biotechnology company focussing on treatment of chronic pain.

“Kudos to your team. Thank you very much for your support and agility to answer our questions.”

- Europe-based provider of solutions to automate data centre operations.

“We appreciate you and your team taking out time to share the report and data file with us, and we are grateful for the flexibility provided to modify the document as per request. This does help us in our business decision making. We would be pleased to work with you again, and hope to continue our business relationship long into the future.”

- India-based manufacturer of industrial and specialty intermediates with a strong global presence.

“I want to first congratulate you on the great work done on the Medical Platforms project. Thank you so much for all your efforts.”

- One of the largest cosmetics company in the world.

“Thank you very much. I really appreciate the work your team has done. I feel very comfortable recommending your services to some of the other startups that I’m working with, and will likely establish a good long partnership with you.”

- U.S. based startup operating in the cultivated meat market.

“We received the below report on the U.S. market from you. We were very satisfied with the report.”

- Global hearing aids manufacturer.

“I just finished my first pass-through of the report. Great work! Thank you!”

- U.S. based solar racking solutions provider.

“Thanks again for the great work on our last partnership. We are ramping up a new project to understand the imaging and imaging service and distribution market in the U.S.”

- World’s leading advisory firm.

“We feel positive about the results. Based on the presented results, we will do strategic review of this new information and might commission a detailed study on some of the modules included in the report after end of the year. Overall we are very satisfied and please pass on the praise to the team. Thank you for the co-operation!”

- Germany based machine construction company.

“Thank you very much for the very good report. I have another requirement on cutting tools, paper crafts and decorative items.”

- Japanese manufacturing company of stationery products.

“We are happy with the professionalism of your in-house research team as well as the quality of your research reports. Looking forward to work together on similar projects”

- One of the Leading Food Companies in Germany

“We appreciate the teamwork and efficiency for such an exhaustive and comprehensive report. The data offered to us was exactly what we were looking for. Thank you!”

- Intuitive Surgical

“I recommend Fortune Business Insights for their honesty and flexibility. Not only that they were very responsive and dealt with all my questions very quickly but they also responded honestly and flexibly to the detailed requests from us in preparing the research report. We value them as a research company worthy of building long-term relationships.”

- Major Food Company in Japan

“Well done Fortune Business Insights! The report covered all the points and was very detailed. Looking forward to work together in the future”

- Ziering Medical

“It has been a delightful experience working with you guys. Thank you Fortune Business Insights for your efforts and prompt response”

- Major Manufacturer of Precision Machine Parts in India

“I had a great experience working with Fortune Business Insights. The report was very accurate and as per my requirements. Very satisfied with the overall report as it has helped me to build strategies for my business”

- Hewlett-Packard

“This is regarding the recent report I bought from Fortune Business insights. Remarkable job and great efforts by your research team. I would also like to thank the back end team for offering a continuous support and stitching together a report that is so comprehensive and exhaustive”

- Global Management Consulting Firm

“Please pass on our sincere thanks to the whole team at Fortune Business Insights. This is a very good piece of work and will be very helpful to us going forward. We know where we will be getting business intelligence from in the future.”

- UK-based Start-up in the Medical Devices Sector

“Thank you for sending the market report and data. It looks quite comprehensive and the data is exactly what I was looking for. I appreciate the timeliness and responsiveness of you and your team.”

- One of the Largest Companies in the Defence Industry
We use cookies to enhance your experience. By continuing to visit this site you agree to our use of cookies . Privacy.