AI-driven Chatbots Expected to Outperform Rule-based Chatbots by 2022 | Arizton

Arizton's report on global chatbot market expects the AI-integrated chatbot to witness maximum growth CAGR over the next five years.

Technological innovations with intelligent algorithms that enable computer systems to increase user engagements and handle mundane operations will create the industry for chatbots in the global market. The growing requirement to improve productivity, handle competition, and fulfill the evolving customer expectations is resulting in the adoption of chatbots in the e-commerce industry. The rising demand for technology infrastructure, customer support, and innovative user engagement strategies in the retail industry will propel the development of the global market. The advent of cloud infrastructure, open sharing of development resources, and highly customizable and programmable interfaces is driving businesses to adopt innovative solutions to boost their market revenues.

Analysts at Arizton expects the global chatbots market to generate revenues of over $802 million by 2022, growing at a CAGR of around 28% during 2017-2022.

Read the full report on Chatbot Market – Global Outlook and Forecast 2017-2022
https://www.arizton.com/market-reports/chatbot-market-global

The different types of chatbots available in the global market are:

Rule-based Chatbots

Rule-based chatbots are specifically designed to understand a pre-defined set of instructions and are built mostly for a single purpose of chat. These systems provide a linear and single dimensional support such as customer services. They have a specific architecture and technology requirement, which is quicker and easier to build, deploy and implement and are, therefore, cheaper and less scalable. These chatbots recognize the command given and then respond as per a rule the developer wrote and instantly sends back the response. They are simply programmed to respond to keywords provided, and they cannot understand a misspelled keyword. Rule-based Closed Domain (RBCD) AI is a simple system and less dynamic than other forms of AIs available in the market. It provides well-constructed rules and sophisticated regex to make the bot smart. The main advantage of using RBCD AI is that it guides the user towards the desired answer more quickly, especially when the intent is obscure. The rule-based bots market is expected to grow at a CAGR of approximately 23% during the forecast period.

Major drivers for the adoption and proliferation of rule-based chatbots includes:

These bots can be developed 3–5 times faster than AI-driven bots and usually at one-tenth of the cost.

These are often considered to be the first bets of SMEs looking to replace conventional chat applications with bots on account of the simplified use

These bots constitute a major chunk of implementations in end-users about grocery purchase, insurance, and telecom that are among the largest test cases for bot implementation

Developers for bot implementation are usually available at one-third of the cost of resources well-versed with machine learning. Further, these bots turn out to be highly maintainable and upgrading; an upgrade is usually warranted every 3–6 months based on the end-user industry

AI-integrated Chatbots

AI-integrated chatbots are powered by AI and natural language processing and included three major aspects that consist of a database, application layer, and access to APIs. These systems are designed to provide functions that are greater than any normal chatbots that utilize a brain like a system and natural language processor to convert and harness the outcome of conversations. These systems use AI and coverts that knowledge through learning into powerful decision-making capabilities that improve operational capacities and increases user interaction levels. The AI-integrated chatbot ecosystem consists of a database to store, hosting environment, the central nervous system or brain, which is the natural language processor and an actual user interface. The introduction of these bots has the potential to improve the customer service and boost profits for many small and medium-sized businesses. The AI-integrated bots market is estimated to grow at a CAGR of around 34% during 2017-2022.

Key drivers for adoption and implementation of AI-integrated chatbots consists of:

Evolutionary changes in NLP both in the context of chat and voice. NLP algorithms are currently easily available from technology companies, including Google, IBM, Oracle, and Facebook all of which are driving better learning going forward. More than 80 chat processing algorithms are easily available in an API mode at zero cost or a reasonable cost

Better availability of cloud infrastructure enabling easy access to computing power and evolution of Bot-as-a-Service; businesses can now have access to intelligent bots hosted an accessed from the cloud

AI-driven bots in the banking sector reported 70% higher engagement rate than rule-based ones and the same in healthcare reported a 72% higher engagement rate on a focused group of audiences in the US. High engagement rate in pre-purchase phase is often correlated with better chances of lead conversion. As a result, these bots are often considered to yield better ROIs

The leading vendors in the global chatbots market are Anboto Group, Creative Virtual, eGain Corp., Inbenta, Nuance Communications Inc.

Read: Increased Prominence of Messaging Applications to Drive Global Chatbots Market

https://www.arizton.com/news/press-release/increased-prominence-of-messaging-applications-to-drive-global-chatbot-market

Order a report now: https://www.arizton.com/market-reports/chatbot-market-global

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