At 20.6% CAGR, North America Conversational AI Market is Projected to be Worth US$ 14,481.37 million by 2031, says Business Market Insights

According to Business Market Insights’ research, the North America conversational AI market  was valued at US$ 3,235.60 million in 2023 and is expected to reach US$ 14,481.37 million by 2031, registering a CAGR of 20.6% from 2023 to 2031. Growing adoption of conversational AI in gaming industry and increasing demand for chatbot solutions are among the critical factors attributed to drive the North America conversational AI market growth.

Businesses in the digital gaming and interactive entertainment sectors seek innovative ways to use AI to improve player experience. Developers can improve player engagement and the overall gaming experience by utilizing conversational AI. In video games, non-playable characters (NPCs) are characters that players interact and engage with on a regular basis. These characters accompany or guide players throughout the game. Conversational AI in gaming refers to the incorporation of AI technology into video games to allow for more natural and dynamic interactions between players and NPCs, as well as among players themselves. Conversational AI enables dialogue systems in games to mimic real-world conversations, especially between players and non-player characters, by understanding and reacting to user input.

Furthermore, conversational AI allows game developers to enhance their NPC experience. By including chatbots, speech recognition, and natural language processing capabilities, game creators can enhance the ability of NPCs to comprehend and react to player questions, instructions, and conversations in a natural manner. For example, conversational AI could be used to improve virtual characters that function as interactive merchants or quest-givers in massively multiplayer online role-playing games (MMORPGs). With these virtual characters, players can engage in conversation or even lighthearted banter outside of the conventional dialogue tree. With the ability to engage with these AI-driven entities in the same way as other players, users can have a more immersive and socially engaging experience, adding to the game's richness. Thus, all the above factors are expected to propel the demand for conversational AI in the gaming industry, which will fuel the conversational AI market growth during the forecast period.

On the contrary, rising privacy concerns hampers the growth of North America conversational AI market .

Based component, the North America conversational AI market  is segmented into platform and service. The platform segment held 72.6% share of North America conversational AI market  share in 2023, amassing US$ 2,348.22 million. It is projected to garner US$ 10,938.57 million by 2031 to register 21.2% CAGR during 2023–2031.

By type, the North America conversational AI market is bifurcated into chatbots and intelligent virtual assistants. The chatbots segment held 68.5% share of North America conversational AI market  in 2023, amassing US$ 2,217.51 million. It is anticipated to garner US$ 10,204.96 million by 2031 to expand at 21.0% CAGR during 2023–2031.

In terms of deployment type, the North America conversational AI market is bifurcated into on-premise and cloud. The on-premise segment held 59.5%  share of North America conversational AI market  in 2023, amassing US$ 1,925.24 million. It is anticipated to garner US$ 8,146.91 million by 2031 to expand at 19.8% CAGR during 2023–2031.

Based on industry, the North America conversational AI market is segmented into retail & e-commerce, healthcare & life sciences, travel & hospitality, BFSI, IT & telecom, media & entertainment, and others. The retail & e-commerce segment held 22.6% share of North America conversational AI market  in 2023, amassing US$ 732.70 million. It is anticipated to garner US$ 3,708.87 million by 2031 to expand at 22.5% CAGR during 2023–2031.

By country, the North America conversational AI market  is segmented into the US, Canada, and Mexico. The US segment held 84.7% share of North America conversational AI market  in 2023, amassing US$ 2,741.20 million. It is anticipated to garner US$ 12,466.30 million by 2031 to expand at 20.8% CAGR during 2023–2031

Key players operating in the North America conversational AI market are Alphabet Inc; Amazon.com Inc.; Artificial Solutions International AB; Cognigy GmbH; International Business Machines Corp; Kore.ai Inc.; Microsoft Corp; Oracle Corp; Rasa Technologies Inc; and SAP SE; among others.

• In 2024; Amazon.com, Inc. announced the general availability of Amazon Q for businesses and developers. Amazon Q is the most capable generative artificial intelligence (AI)-powered assistant for accelerating software development and leveraging companies’ internal data.

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