Conversational AI and Virtual Assistant Trends for 2022
2020 and 2021 completely threw everything online. This paved the way for rising customer expectations towards fast, simple and seamless experiences. AI-based virtual assistants, chatbots and conversational AI played an important role for satisfying this need. The forecasts show that the role of them will be bigger in the upcoming period. It is important to understand the most prominent trends that will shape the field of conversational AI, virtual assistants and chatbots in 2022.
Conversational AI market at a glance
According to IDC Worldwide Semiannual Cognitive Artificial Intelligence Systems Spending Guide, Conversational AI Market will reach $77.6 billion in 2022, more than three times the $24.0 billion forecast for 2018. The compound annual growth rate (CAGR) for the 2017–2022 forecast period will be 37.3%. Two areas of focus for these investments are conversational AI applications, namely personal assistants and chatbots, and deep learning and machine learning applications. North America is expected to hold the largest market size in the global conversational AI software market, while Asia Pacific (APAC) is expected to grow at the highest CAGR during the forecast period.
The chatbot market is expected to grow by USD 1.11 billion, progressing at a CAGR of almost 29% during the forecast period. The report also forecasts 70 percent of the global number of chatbots accessed by 2024 would be attributable to Far East & China. Furthermore, over $80 billion will be spent via chatbots in China in 2024; accounting for over 55 per cent of global chatbot spend in that year.
As virtual assistants trends look more promising by the advancement of the technology, the improvement of its customer experience and the proliferation of successful use cases encouraged more and more organizations from various sectors focus on conversational AI for their business strategy.
8 Prominent Conversational AI and Virtual Assistant Trends
After two game changing years in which we witnessed acceleration of digitalization and conversational automation, we now expect smarter virtual assistants creating more value in more spheres of our lives. So, by which parameters this will happen in 2022?
1. Customer service automation as a priority
The pandemic fuelled an unexpected increase in the number of online purchases, which caused an increase in the number of support tickets and customer queries. In such a period, conversational AI offered a huge opportunity for the enterprises to increase efficiency and manage the operational costs better as the call volumes increase. Virtual Assistants and automation have proved the transforming power in the field of customer service including both traditional IVR based call centers and live chat platforms.
Automating customer service will continue to be on the rise. As conversational IVR that uses ASR (Automated Speech Recognition) and TTS (Text to Speech) technologies get more advanced, enterprises as well as contact centers search for the ways to upgrade their operational models towards more AI-based ones. AI-based bots both in the voice and text based modalities are mature enough to handle complicated tasks in addition to simple ones such as changing a password, requesting a balance, scheduling an appointment by themselves without handovering to a human agent. Therefore, there is a great opportunity for automation in the customer service field. This will be aligned with the customer expectations as they aim to reach the businesses in an instant and simple way without waiting in queues.
From the employee perspective, the agents will be freed from the repetitive, routine tasks and this will have a potential of improving employee attrition. In addition, involving AI-based bots in the customer service, never means building a model without the involvement of humans but it is a model where human-AI collaboration stays at the core. Considering the human agents, the second point to emphasize is that the AI will be used more to augment their performance by providing the pre-generated answers to customer queries, and better enterprise knowledge management systems. We will witness the implementation of a holistic view to the human-AI partnership and intelligent call routing systems in the customer service field including two-way handover between human & AI will in the near future. The involvement of conversational IVR in the customer service will achieve key business metrics like average resolution time and first contact resolution while providing excellent customer service and a delightful experience.
2. Voice bots are becoming mainstream
“Voice is the next big thing!” – this has been a common phrase for the last couple of years but in 2022 we will see the involvement of voice bots in our daily lives more, embedded to all kinds of speech interfaces including the IVRs and voice assistants. Voice based bots with advanced personalization capabilities offer great opportunities in many industries with high customer interaction. It is not only about customer service but also converting leads to customers and providing seamless experiences with the company in product and service usage. Multilingual assistants offer companies to serve their customers regardless of their language. In 2022, we will witness more multilingual AI-based virtual assistants that detect the language of the customer and serve him / her accordingly.
It is evident that ASR (Automated Speech Recognition) and TTS (Text to Speech) technologies will change the way people search, shop and engage with the business in their daily lives. The AI powered IVR systems, which we call conversational IVR, voice assistants in the apps of the businesses, or voice assistants such as Siri and Alexa will be the main ways that companies interact with their customers through voice based experiences.
3. AI-based bots will get more human-like
It is obvious that developments in Natural Language Processing, Natural Language Generation, Sentiment Analysis and Multilingual Natural Language Understanding will make virtual assistants more human-like. Providing an enhanced experience in a conversational interface has two components – understanding the user intent and providing the personalized answer. In 2022, we will witness better experiences on both sides as AI technologies and integration capabilities of the assistants get better. For instance, in the conversation, enabling the user to jump to another topic and come back to the initial topic again is something that makes it more human-like and improves the overall experience. In 2022, as the customer expectations rise towards human-like, personalized experiences, it will be a must-have feature for the assistants. Another aspect is interpreting human emotions. Virtual assistants are expected to respond to the users identifying their emotions by sentiment-reading abilities. With the help of sentiment analysis, chatbots understand whether the conversation was going well and respond to customer emotions accordingly. Being human-like requires a compilation of all of them to mimic a human conversation. It is not just about providing an effective response, you also need to create a delightful customer experience.
4. Deep customer insights to empower virtual assistant behavior
As companies had been offering virtual assistants both to their customers and employees for a certain period of time, 2022 will be the year to release the analytics and insights. Virtual Assistants will be more equipped to precisely measure and assess important search keywords, preferences, and satisfaction using chatbot analytics and insights, allowing businesses to create deeper ties and connections with customers. For this to be realized the virtual assistant should be integrated with ERPs, CRMs, and other software systems to provide a start-to-finish view of client interactions. Analyzing the data that is accumulated by keeping a record of every question asked, every answer delivered, and every query will be turned into actionable insights, but it is not an easy task. This ability will be an important muscle for the companies to enhance the experience not only in the conversational fields itself but also in all the touchpoints.
5. Messaging platforms as a growth driver for virtual assistants
Messaging has been on the rise for more than 5 years. The total number of active monthly users of top 6 messaging platforms exceeds 6 Billion. It is a highly competitive market where WhatsApp is the leader and players invest in conversational commerce. These platforms encourage people to shop via conversational experiences offered by virtual assistants in their platforms. It is also considered as a big offer by the end user because using the messaging platform that is part of their daily life and interacting with the businesses is very convenient for them. It is a way to offer seamless commerce experiences including search, purchase, payment and support in a very simple and convenient way. Platforms equipped with virtual assistant functions can boost brand awareness, sales/lead generation, marketing engagement, and customer support. Having this in mind, many businesses, large and small, will adopt messaging apps to boost their customer engagement by empowering the experience with an AI-based virtual assistant that is integrated with various business functions. Therefore, messaging platforms will keep being a driver of virtual assistants adoption in 2022.
6. More comprehensive automation options
A new report from Juniper Research found that consumer retail spending over chatbots will reach $142 billion by 2024; rising from $2.8 billion in 2019. This represents average annual growth of 400% over this period. As more customers prefer self service options for their transactions, the FAQ virtual assistants with a limited scope will not satisfy customer needs. Therefore, more companies will invest to adopt virtual assistants that cover a comprehensive experience including campaign management, lead generation, FAQ, search, purchasing & payment, reservations, appointments and all other transactions including after sales support. Companies should consider this whole cycle from a holistic perspective and offer it to the customers in a seamless way. For this to be realised, the virtual assistants should be integrated into the internal enterprise systems of the enterprises. Traditional virtual assistant applications mostly provide a simple conversational exchange but organizations will have to include integrations to achieve a far greater level of personalization within interactions.
It is obvious that the most recently-added part of the overall experience is allowing the customers to pay directly in the conversational field without being directed to another platform. The instant process makes the customer happy and improves customer satisfaction. For instance, if you want to order your lunch, all you need is to chat with your favorite restaurants’ chatbot and tell it that you want your usual order. It can be as simple as this, as the system knows you and the virtual assistant will communicate with the internal system to make your order ready and delivered on time. Besides this, the virtual assistant may guide you to choose the menu of your preferences, and help you with the payment and order-tracking. We forecast that besides Masterpass, Paypal, PayU, CCAvenue, Razorpay, Stripe more payment gateways will allow users to make payments without ever leaving the messaging platform. By connecting with the payment infrastructure, businesses can provide chatbots with enough data to encourage conversation-driven upselling to consumers. The same may be utilized to offer updates on a user’s transaction data, payment confirmation, expense records, and so on, resulting in a high level of user confidence and retention. Building this end-to-end experience in a virtual assistant not only increases efficiency but impacts a company’s revenues as well.
7. Virtual Assistant for internal use in enterprises
After the discovery of the potential of AI-based virtual assistants as a customer interaction channel, companies started to consider them as a way to increase employee efficiency by automating and streamlining the internal workflows. Gartner predicts that by 2022, 70% of white-collar workers will interact with conversational platforms daily to speed up their work. Specifically large enterprises that have high numbers of internal processes, tend to automate them by virtual assistants such as helping employees with their HR, IT, procurement, legal, finance related queries and tasks. Beyond this, virtual assistants also are integrated to RPAs and can trigger them to complete a routine task in the most efficient way. HR questions and transactions, employee onboarding, internal help desk for the systems and screening, passwords, answers for legal queries are just a few examples that virtual assistants can help employees.
8. Virtual Assistants will become an integral part of daily lives
AI-based virtual assistants are considered as one of the most convenient ways of fulfilling the expectations of digital customers that get used to realize many transactions through digital channels and expect instant response to their queries and issues. AI-based assistants are ready to support customers instantly, 24/7 and they are scalable while the number of tickets rise in peak times. This drives the adoption of virtual assistants in order to satisfy customer needs while managing the costs wisely.
Every year more and more brands are adopting virtual assistants and this paves the way to making them an integral part of our lives both as an employee and as a consumer. Therefore, in the next couple of years, the customers themselves will be the drivers of more automation. Chatbots will be implemented for more use cases in more industries including travel, hospitality, education, shopping, healthcare, fitnessing, banking, insurance, telecommunications, media & entertainment, public services, etc. Not limited to them, there are a lot of easily automatable interactions in our day to day lives. Just like with the PC, advancements in technology and reductions in price will allow virtual assistants to be democratically distributed amongst the general public.
Low-code and no-code AI is an important factor for the increase in the number of use cases where chatbots create value. A big barrier to the adoption of AI-based virtual assistants in many companies is the scarcity of skilled AI engineers who can create the necessary tools and algorithms. No-code and low-code solutions offer simple interfaces that can be used to build virtual assistants by those who have no coding knowledge. In addition to building the bot itself, there are no-code tools that enable the business analysts to integrate the chatbots into the integral enterprise systems easily. Enterprises’ readiness in terms of architecture and organization, is also crucial as the use cases and opportunities rise. Gartner expects that by 2025, 70% of organizations will have operationalized AI architectures due to the rapid maturity of AI orchestration initiatives. All of this will play a key role in the “democratization” of AI and data technology which will create more virtual assistants in the future.
Final thoughts on conversational AI and virtual assistants trends
Automation that conversational AI and virtual assistants offer is a game changer for the near future both in terms of the transformation of businesses and our daily lives. 2022 is a year with big expectations for the industry as all of the trends mentioned in this blog will drive more adoption and innovation. It is widely expected that the role of conversational AI and virtual assistants will be bigger. The most prominent field that the effect will be tremendous is customer service where specifically voice-enabled conversational IVR systems will be a priority for many organizations. We’ll just see how the promises mentioned above that 2022 will bring might come true!