Virtual Assistant Market by Type, End-user, and Geography - Forecast and Analysis 2023-2027

Virtual Assistant Market Forecast 2023-2027:

The virtual assistant market is forecast to increase by USD 26.95 billion, at a CAGR of 37.29% between 2022 and 2027. Market growth hinges on multiple factors, notably the desire for superior customer service, perks extended to content consumers, owners, and publishers, and the prevalence of smartphones equipped with intelligent virtual assistants, augmenting human interactions. Enhanced customer service not only fosters loyalty but also drives market expansion by meeting evolving consumer expectations. Moreover, the allure of benefits bestowed upon content stakeholders fuels demand and stimulates market dynamics. The integration of intelligent virtual assistants into smartphones further catalyzes growth, as these devices streamline user experiences and offer personalized interactions. Together, these elements converge to shape a burgeoning market landscape characterized by innovation and consumer-centric strategies.

What will be the size of the Market During the Forecast Period?

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Market Segmentation

This market research report extensively covers market segmentation by type (spoken commands and text-to-speech), end-user (automotive, BFSI, government, retail, and others), and geography (North America, APAC, Europe, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.

Market Dynamics and Customer Landscape

In the current market, Intelligent Virtual Assistants (IVAs) powered by Artificial Intelligence (AI) are revolutionizing various industries. Skoda, automakers, are integrating IVAs in their vehicles to reduce driver distraction. In the healthcare and pharmaceutical sectors, R&D investments are being made to develop advanced IVAs for patient care and medication management. Marketing agencies are leveraging IVAs for promotional tactics through messaging applications and chatbots. Grocery outlets like Whole Foods store and ecommerce platforms are adopting IVAs with voice technology, such as Amazon Alexa, for shopping updates, upcoming offers, and shopping festival details. Publishers like The Tennessean and Texas Tribune are using IVAs for notification capability. Smart speakers like Sonos One and third-party speakers are also integrating IVAs to enhance user experience. Overall, the market is growing, offering affordable and high-end features to cater to diverse industries and consumer needs. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.

Key Market Driver

The demand for enhanced customer service is notably driving the market growth. Virtual Assistants, powered by Artificial Intelligence and machine learning, are increasingly being adopted by businesses to deliver intuitive and automated customer support across digital channels. Intelligent Virtual Assistants, such as those found on Skype, enable natural conversations using text or voice, offering a consistent experience on websites, apps, and text messaging applications. R&D investments in AI and conversational capabilities are driving growth in this market, with applications in sectors like automakers (e.g., Skoda), healthcare and pharmaceutical vendors, marketing agencies, grocery outlets, and educational portals.

Moreover, features like automatic speech recognition, text-to-speech, and chatbots are enhancing the capabilities of Virtual Assistants, with notable players including Microsoft's Cortana, Avaamo, and Wipro Ventures. The market also includes voice-activated speakers from companies like Bose in the consumer electronics segment and in the automotive segment for in-car assistance. Overall, Virtual Assistants are streamlining manual tasks, answering common questions, and providing personalized responses, making them an essential tool for customer service agents and human interfaces. This, in turn, is driving the market growth during the forecast period.  

Significant Market Trend

The popularity of chatbots is the key market trend driving the market growth. The market for Virtual Assistants (VAs) is experiencing significant growth due to the integration of Artificial Intelligence (AI) and machine learning. Intelligent VAs, such as those found on Skype, are increasingly being used for customer interactions, particularly in sectors like healthcare and pharmaceuticals, where R&D investments and prescription management are key. Automakers, including Skoda, are also investing in VAs for in-car applications to reduce driver distraction. Marketing agencies, grocery outlets, and educational portals are also leveraging VAs for chatbot services and text-to-speech segments.

Further, smart speakers, like those from Bose and Microsoft's Cortana, are popular in the consumer electronics segment, while conversational AI solutions are being used for manual tasks and answering common questions in place of human customer service agents. Avaamo, backed by Wipro Ventures, is a leading provider of enterprise-grade VAs for various industries. VAs are also being integrated into voice-activated speakers for playing music and controlling smart homes. Thus, the increasing popularity of chatbots will augment the growth of the market during the forecast period.

Major Market Challenge

Technical concerns are the major challenge impeding the market growth. Virtual Assistants, powered by Artificial Intelligence and machine learning, have become essential tools for businesses and consumers alike. Intelligent Virtual Assistants, such as those found on Skype, aim to enhance customer interactions, boost agent productivity, and decrease average handle time. However, challenges persist, including accuracy and personalization issues. To address these concerns, Virtual Assistants must support natural language use, including slang, typos, unstructured content, and complex grammar. They should also guide customers through step-by-step processes. Virtual Assistants are utilized in various sectors, including Automakers (e.g., Skoda), Healthcare and Pharmaceutical companies, Marketing agencies, Grocery outlets, and Educational portals. The Text-to-speech and Automatic speech recognition segments are significant in this market. Consumer electronics companies, like Bose, and Automotive segments also invest in Virtual Assistants.

However, chatbots and smart speakers are popular applications, with voice assistants like Microsoft's Cortana, Avaamo, and Wipro Ventures leading the way. Virtual Assistants perform manual tasks, answer common questions, and even play music on voice-activated speakers, making them indispensable human interfaces. Affordable and accessible Virtual Assistants continue to gain traction in connected homes and cloud contact centers. Inference Solutions and conversational artificial intelligence are key technologies driving the growth of this market. Such factors will hinder the market growth during the forecast period.

Customer Landscape

The market forecasting report includes the adoption lifecycle of the market research and growth, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market growth and forecasting strategies.

Customer Landscape

Who are the Major Market Companies?

Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the intelligent market.

Anboto Europe SL Co.- The market for virtual assistants, such as Anboto Virtual Assistant, is a significant industry.

The report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:

• 247.ai Inc.
• Alphabet Inc.
• Amazon.com Inc.
• Apple Inc.
• Artificial Solutions International AB
• Baidu Inc.
• Creative Virtual Ltd.
• CSS Corp.
• CX Co.
• eGain Corp.
• GAVS Technologies NA Inc.
• Inbenta Holdings Inc.
• International Business Machines Corp.
• Microsoft Corp.

Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.

What is the Fastest-Growing Segment in the Market?

The market share growth by the spoken commands segment will be significant during the forecast period. The Virtual Assistants market, driven by Artificial Intelligence and Intelligent Virtual Assistants, experienced significant growth in 2022, with Spoken Commands as the largest segment. Speech and voice recognition technologies, integral components, enable understanding and responding to user commands. Applications span across various industries like Automakers (Skoda), Healthcare, Pharmaceutical vendors, R&D investments, Marketing agencies, Grocery outlets, and Educational portals.

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The spoken commands segment was valued at USD 1.07 billion in 2017 and continue to grow by 2021. Chatbots and Smart Speakers, such as those from Microsoft's Cortana, Bose, and consumer electronics segment, are popular. Machine learning and virtual assistants facilitate personal assistance, managing common questions, and customer service in connected homes and cloud contact. Inference Solutions, conversational artificial intelligence, and manual tasks are also addressed. Affordable options from companies like Avaamo and Wipro Ventures cater to diverse user needs, including playing music and voice-activated speakers. Human interfaces continue to evolve, offering enhanced convenience and security.

Which are the Key Regions for the Market?

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North America is estimated to contribute 39% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional market trends and drivers that shape the market during the forecast period. North America was the largest geographical segment of the market in 2022 and will continue to remain the largest segment during the forecast period. North America has a higher inclination toward the use of high-end technology products and services because of the availability of high-end services and higher disposable incomes in the region. Hence, it can easily adapt to technological changes. North America is home to the best artificial intelligence technologies in the world, and hence, the region has easy access to these technologies. Many companies in this region support the development of these technologies. Therefore, North America holds a major share in the market.

Segment Overview

The report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027. 

• Type Outlook 
  • Spoken commands
  • Text-to-speech

• End-user Outlook 
  • Automotive
  • BFSI
  • Government
  • Retail
  • Others

• Region Outlook 
  • North America
    • The U.S.
    • Canada
  • Europe
    • The U.K.
    • Germany
    • France
    • Rest of Europe
  • APAC
    • China
    • India
  • South America
    • Chile
    • Argentina
    • Brazil
  • Middle East & Africa
    • Saudi Arabia
    • South Africa
    • Rest of the Middle East & Africa

Market Analyst Overview

In the dynamic and evolving market of technology, the Virtual Assistant industry continues to gain traction. With keywords like Artificial Intelligence (AI), Assistants, and Intelligence, these advanced tools are revolutionizing the way we live and work. Virtual Assistants like Virtual, Automaker, and Skype are making our lives easier by providing services such as scheduling appointments, managing emails, and even controlling smart home devices. Moreover, Drive and Marketing are essential aspects of the market. These tools provide businesses with the ability to connect with customers through personalized and efficient communication. For instance, Chatbots and Conversational AI are becoming increasingly popular for customer service, enabling quick and accurate responses to inquiries.

Additionally, the integration of Voice Technology and Search engines is a game-changer in the Virtual Assistant landscape. With voice commands becoming more common, Virtual Assistants like Google and Amazon Alexa are becoming household names. Furthermore, the use of Machine Learning algorithms and Natural Language Processing (NLP) technology is enabling Virtual Assistants to understand and respond to user queries more effectively. In conclusion, the market is a rapidly growing industry, with keywords like AI, Assistants, Intelligence, Drive, Marketing, Voice Technology, and Search engines playing a significant role in its success. These tools are transforming the way we communicate, work, and live, making them an essential part of our daily lives.

Market Scope
Report Coverage	Details
Page number	175
Base year	2022
Historic period	2017 - 2021
Forecast period	2023-2027
Growth momentum & CAGR	Accelerate at a CAGR of 37.29%
Market growth 2023-2027	USD 26.95 billion
Market structure	USD Fragmented
YoY growth 2022-2023(%)	35.47
Regional analysis	North America, APAC, Europe, South America, and Middle East and Africa
Performing market contribution	North America at 39%
Key countries	US, China, Japan, UK, and Germany
Competitive landscape	Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks
Key companies profiled	247.ai Inc., Alphabet Inc., Amazon.com Inc., Anboto Europe SL Co., Apple Inc., Artificial Solutions International AB, Baidu Inc., Creative Virtual Ltd., CSS Corp., CX Co., eGain Corp., GAVS Technologies NA Inc., Inbenta Holdings Inc., International Business Machines Corp., Microsoft Corp., Oracle Corp., Synthetix Ltd., True Image Interactive Inc., VA Company LLC, and Verint Systems Inc.
Market dynamics	Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, Market growth and Forecasting, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period
Customization purview	If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized.

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What are the Key Data Covered in this Market Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the growth of the market between 2023 and 2027
• Precise estimation of the size of the  market size and its contribution to the parent market
• Accurate predictions about upcoming trends and changes in consumer behavior
• Growth of the market industry across North America, APAC, Europe, South America, and Middle East and Africa
• A thorough analysis of the market’s competitive landscape and detailed information about companies
• Comprehensive analysis of factors that will challenge the growth of market companies

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