Conversational AI Market to Reach $49.8B by 2031
Source: prnewswire.com
Conversational AI Market Growth
The Conversational AI Market is expected to grow from USD 17.05 billion in 2025 to USD 49.80 billion by 2031, reflecting a CAGR of 19.6%, according to a MarketsandMarkets™ report.
Market Drivers
Market expansion is attributed to the increasing need for AI-powered customer support, which enhances user experience and reduces operational costs. The widespread use of messaging apps and voice assistants also contributes to market growth, fostering the use of chatbots and virtual agents. The focus on omnichannel engagement across sectors like e-commerce, banking, and healthcare further drives conversational AI integration. Advances in NLP and machine learning improve AI systems' accuracy and understanding in real-time interactions.
Internal Enterprise Systems
The internal enterprise systems segment is predicted to hold the largest market share because conversational AI is being integrated into core business operations. Businesses are incorporating conversational AI into CRM, ERP, HRM, and ITSM platforms to automate tasks, improve employee experience, and enhance customer support. This integration enables real-time insights, reduces bottlenecks, and supports data-driven decisions. Integrated conversational AI offers customization, data security, and regulatory compliance. Digital transformation is boosting the importance of this segment for AI adoption.
Generative AI Agents
Generative AI agents are expected to grow the fastest in the Conversational AI Market because they can produce intelligent and context-aware responses. These agents use deep learning models to understand user intent and generate personalized outputs in real time. Their adaptability suits them for healthcare, banking, retail, and enterprise support. The rising demand for 24/7 customer service and natural human-computer interaction is driving their adoption. Improvements in language modeling, multilingual support, and emotional intelligence are expanding their applications. Businesses are expected to increase investments in generative AI agents to improve customer engagement and efficiency.
North America's Dominance
North America is projected to lead the Conversational AI Market due to its advanced technological infrastructure and adoption of AI solutions. The region has many AI companies and startups investing in R&D. Strong demand from BFSI, healthcare, and retail sectors is also fueling growth. Consumer awareness and the use of smart devices support market expansion. Regulatory support and a skilled workforce contribute to North America's leading position.
Key Players
Key companies in the Conversational AI Market are Microsoft (US), IBM (US), Google (US), OpenAI (US), Baidu (China), Boost.ai (Norway), Verloop.io (India), OneReach.ai (US), Omilia (Cyprus), and Aisera (US).