Intelligent Virtual Assistant Market - Size, Share, Industry Trends, and Forecasts (2024 - 2031)

By Product:

Based on the product, the market is bifurcated into Chatbot and Smart Speaker.

Trends in the product:

• Advancements in Natural Language Processing (NLP) are enhancing chatbots for contextual understanding and responding to complex queries, facilitating effective conversations.
• The demand for voice commerce, where consumers buy products using voice instructions, is leading to the expansion and improvement of smart speakers in the retail space.

The chatbot segment accounted for the largest revenue share in 2023.

• Chatbot is a computer program that simulates conversation with human end users. Frequently, it utilizes Natural Language Processing (NLP) for analyzing inputs and employs generative AI for automating responses.
• These self-learning generative AI chatbots, built on a conversational AI platform are continually and automatically improving by learning from past conversations with users to provide enhanced and customized responses.
• Determinants including efficient customer service, 24/7 availability, assistance in coding, and other workspaces for improved productivity.
• In May 2023, Google , launched Duet AI integrated with Google Workspace products, leveraging advanced NLP and machine learning to assist users in coding, generating content, drafting emails, and creating documents.
• Thus, the self-learning property of chatbots provides customized responses to the user, enhancing their experiences and, in turn driving the global intelligent virtual assistant market growth.

The smart speaker segment is anticipated to register the fastest CAGR growth during the forecast period.

• Consumers are increasingly seeking hands-free, voice-controlled assistance for tasks such as setting reminders, playing music, and getting news updates, which smart speakers provide efficiently.
• Advancement in voice recognition, natural language processing, active sensors, and gesture controls is enhancing the accuracy and responsiveness of smart speakers, improving user experiences, and increasing adoption rates.
• Additionally, the use of smart speakers has become common in controlling a range of smart home gadgets such as lights, thermostats, security systems, and more.
• In March 2023, Amazon launched the Echo Dot 5th Gen with improved audio, ultrasound motion detection, temperature sensor, and tap gesture controls. Equipped with built-in sensors, users can create convenient smart home schedules with compatible devices.
• Hence, as per analysis the demand for the smart speaker segment is anticipated to grow intelligent virtual assistant market demand in the forecast period.

By Type:

Based on type the market is segmented into Text-based IVA, Voice-based IVA, Hybrid IVA, Task-specific IVA, and Others.

Trends in the type:

• Improvements to personalization features allow text-based IVAs to provide customized responses depending on user behavior and preferences, ultimately boosting engagement and user satisfaction.
• Task-specific IVAs are being developed by various industries such as healthcare, finance, and retail, offering specialized functionalities tailored to industry needs, such as patient management, financial advisory, and personalized shopping assistance.

The text-based segment accounted for the largest revenue share of 33.07% in 2023.

• Text-based IVAs are extensively used in customer service to handle a large volume of queries through chat interfaces on websites, apps, and messaging platforms.
• Features including enhanced customer service, easy implementation, cost-effectiveness, and scalability drive the users.
• Moreover, these IVAs are used for internal business communications, helping automate workflows, schedule meetings, and manage tasks within platforms like Microsoft Teams and Slack.
• In September 2023, Microsoft , introduced Copilot text-based AI assistance, Integrated with popular Microsoft 365 apps like Word, Excel, PowerPoint, Outlook, and Teams. This helps in coding using natural language prompts, boosts creativity, and empowers employees across functions.
• Hence, text-based IVAs currently dominate the industry trend due to their widespread use in customer service, ease of implementation, and versatility across various digital platforms.

The voice-based segment is anticipated to register the fastest CAGR growth during the forecast period.

• Voice-based IVAs are crucial for managing smart home devices, offering users hands-free control over lighting, thermostats, security systems, and more, enhancing convenience and efficiency.
• These IVAs are being integrated into a growing range of devices, including smartphones, wearables, automobiles, and home appliances, broadening their application and user base.
• Moreover, voice-based IVAs integrated with smartphones allow users to make use of the device more efficiently with voice commands, enhancing their productivity and customer engagement.
• In November 2023, Samsung launched the Bixby Text call voice-based assistant integrated into smartphones, enabling users to answer and respond to phone calls and generate quick responses.
• Thus, the analysis shows that the rise of innovation in the voice-based assistants segment is anticipated to boost the global intelligent virtual assistant market opportunities.

By Application:

Based on application the market is segmented into Customer Service, Health Care, E-Commerce, Education, Banking, Real Estate, Travel, Hospitality, and Others.

Trends in the application:

• IVA facilitates telemedicine by helping patients book virtual consultations, manage prescriptions, and follow up on treatments.
• It provides personalized learning experiences by offering tailored content, quizzes, and study recommendations based on student performance and preferences in the education sector.

The customer service segment accounted for the largest revenue share in 2023.

• Businesses across various industries including finances, education, banking, and others, are increasingly adopting IVAs to handle customer inquiries, provide support, and improve customer satisfaction by offering timely and accurate assistance.
• Additionally, IVAs are easily integrated into various customer touchpoints, including websites, mobile apps, social media platforms, and messaging apps, ensuring consistent and seamless customer service.
• In October 2022, Wells Fargo, & Company introduced Fargo, a virtual assistant app integrated with Google Cloud's AI to provide a more personalized, convenient, and simple banking experience, enhancing customer service and meeting individual financial needs.
• Therefore, the market analysis concludes that the customer-service segment is propelling the intelligent virtual assistant market share.

The healthcare segment is anticipated to register the fastest CAGR growth during the forecast period.

• The increasing adoption of telehealth services is driving the need for IVAs to assist with virtual consultations, remote patient monitoring, and telemedicine appointments.
• They are used to monitor chronic conditions, remind patients to take medications and provide personalized health advice leading to better healthcare.
• According to an analysis of the National Center for Biotechnology Information ,76% of healthcare professionals observed improvement in the health of patients, virtual assistants in healthcare provide potential benefits for supporting patients, streamlining tasks, and acting as nonmedical caregivers.
• Hence, virtual assistant in healthcare is anticipated to show substantial growth in the intelligent virtual assistant industry during the forecast period.

Regional Analysis:

The regions covered are North America, Europe, Asia Pacific, the Middle East and Africa, and Latin America.

North America is estimated to reach over USD 34,078.89 Million by 2031 from a value of USD 4,894.38 Million in 2023 and is projected to grow by USD 6,150.71 Million in 2024. The demand for the intelligent virtual assistant market is driven by technological advancements, high adoption rates of smart devices, and significant investment in AI and machine learning.

• In April 2023, Google (California, US) workspace launched Google Vids AI-powered video creation app for work. This enables real-time collaboration for immersive storytelling in videos and generates an editable storyboard based on the content to work on projects securely and seamlessly.

The Asia-Pacific region's market was valued at USD 3,608.95 Million in 2023. Moreover, it is projected to grow by USD 4,548.39 Million in 2024 and reach over USD 25,997.21 Million by 2031. Out of this, China accounted for the maximum revenue share of 33.1%.

The Asia-Pacific region's increasing industrialization and development present lucrative opportunities for market growth. Additionally, high demand in the burgeoning e-commerce sector and customer service applications drive the intelligent virtual assistant market expansion.

• In January 2024, Samsung (Suwon, South Korea), unveiled the Galaxy S24 Ultra, Galaxy S24+, and Galaxy S24, with integrated virtual AI assistant including a chat assistant for messaging, a note assistant featuring AI-generated summaries for template creation, and transcript assistant to transcribe speech-to-text.

As per intelligent virtual assistant market analysis, Europe is anticipated to witness substantial growth in IVA adoption across customer service, healthcare, and e-commerce sectors. Strict data privacy regulations influence the development and deployment of IVA ensuring data protection.

The market in the Middle East and Africa is growing due to the expansion of healthcare and automotive industries, as well as increased use of advanced technology. Prominent nations such as the UAE, Saudi Arabia, and South Africa are at the forefront, reaping the rewards of rising investments in technological advancements in artificial intelligence.

Latin America is an emerging market trend for IVAs with growing adoption across various industries. Countries such as Brazil and Argentina are leading the way in this progression, emphasizing technological evolution and investment.