Automation can improve commercial productivity by achieving exponential improvements in business performance. Within the digital transformation realm, chatbots hold the potential to replace the tasks of many human workers with Artificial Intelligence (AI) capabilities that are able to conduct fluent conversations.
Analysts describe chatbot technologies as computer-based interactive services that utilize software apps designed to simulate conversational capabilities, which may also include automated business processes triggered from these interactions.
Chatbot Application Market Development
Chatbots are becoming increasingly influential in our day-to-day life. They have been developed to assist a range of industries, from simple banking transactions, to retail customer service enquiries. In fact, the financial services and retail sector are considered most likely to explore chatbot apps.
Online retailers, in particular, are being attracted to the technology by the potential for monetization opportunities from up-selling, marketing and shopping cart recovery -- as well as a large global tech-savvy online user base.
According to the latest worldwide market study by Juniper Research, the adoption of chatbots across the retail, banking and healthcare sectors will realize business cost savings of $11 billion annually by 2023 -- that's up from an estimated $6 billion in 2018.
The research found that these cost savings will be derived from the reduced amount of time spent on customer service enquiries. Using chatbots, online businesses will dramatically cut response and interaction times via phone and social channels.
As a result, consumers and businesses could save over 2.5 billion hours by 2023 in these key industry sectors. The study found that the retail sector will gain the most benefits from chatbot technology, with Juniper estimating that by 2023 over 70 percent of chatbots accessed will be retail-based.
Juniper analysts highlighted both customer service and eCommerce as key use cases, although they cautioned that greater investment in chatbot functionality will be required to meet consumer expectations.
In that context, Juniper forecasts that improvement in AI would likely create a more personable user experience and would be fundamental in creating a compelling pull-factor for chatbots.
Juniper cited benefits, such as ongoing cost savings, as major retailer chatbot push factors. Retailers will take advantage of these opportunities; propelling chatbot implementation and driving eCommerce transactions via chatbots to reach $112 billion by 2023.
Outlook for Mobile Chatbot Apps
The research found that while mobile messaging applications have been the space where chatbots first flourished, chatbot-enabled mobile apps in use will greatly increase as many retailers, financial institutions and healthcare providers integrate the technology into their environment.
By 2023, Juniper forecasts that over 50 percent of the chatbots accessed will be through discrete applications, with complete bot integration overturning the make-up of current app functionality.