Global retail spend for chatbots to hit US$12bn in 2023: Juniper

Chatbot uptake will continue to grow as a new Juniper Research predicts global retail spend over chatbots will hit US$12 billion this year.

The same research also highlighted that the spend will surge to $72 billion by 2028.

Increasing by 470 percent over 5 years, much of this growth will be driven by the emergence of cost-effective open language models, most notably ChatGPT, in regions such as North America and Europe.

Open language models consist of large neural networks that are trained on substantial quantities of online information and learn through low levels of human supervision.

They are implemented into chatbots to automate functions such as customer support, marketing and payment processing.

The Juniper report, predicts the development of open language models will become a key driver for retail spending growth amongst small and medium retailers that were previously unable to invest in chatbots.

Frederick Savage, research author at Juniper Research said chatbots have historically been a low priority for omnichannel strategies owing to the high cost of training AI-based algorithms.

“However, ChatGPT has significantly disrupted this trend; lowering the cost of implementation of chatbots for smaller retailers,” he said.

Additionally, the report forecasts Asia Pacific will account for 85 percent of global retail spending over chatbots, despite only representing 53 percent of the global population.

Messaging apps, including WeChat, LINE and Kakao have built strong partnerships with a wide array of online retailers, resulting in high levels of confidence in chatbots as a retail channel.

However, the report predicts that the release of open language models will drive growth outside of Asia Pacific.

By 2028, 66 percent of spend is forecast to be attributable to the region, as online retailers in other areas, such as North America and Europe, implement chatbots into retail activities.