CIOInsider India Magazine

At CES 2025, Microsoft honored Agora, Inc. with the prestigious AI Innovation award for raising standards in AI-driven conversations that nearly resemble human interaction. As Conversational AI becomes the rage across industries, the market is projected to expand at a compound annual growth rate (CAGR) of 26.10 percent from 2024 to 2029, according to GlobeNewswire.

It was in the mid-2010s when food delivery services like Swiggy and Zomato, among others, began to use chatbots. As the number of people using these services grew, the technology framework behind the chatbots could only manage customer queries to a certain extent. Oftentimes, the chatbots’ efforts could not quite comprehend the kind of issues customers pitched and would direct their queries to customer support. Not only did this situation vex customers, it also left a confused and frustrated operations manager amid this chaos.

Jump to the present. Even more people, and still growing, are ordering food online, but there is less tension on the customer care side. They seem to be handling customer queries far better now, and the operations managers also don’t look concerned. What swept their worries away?

Of course, the chatbots! The companies brought in an FAQ chatbot on their apps, which now responds to numerous customer queries. By now, chatbots have mastered automating customer assistance, and the number of these services/solution providers has also increased.

What Industry Experts Are Saying Today

"Chatbot service providers are pushing the boundaries of technology and expanding the capabilities of chatbots. Armed with backend information retrieval capabilities, conversational platforms are being deployed widely. Customers easily use natural language to interact with these chatbots and smart devices like Alexa and Google Home. While this has opened the door to a new and drastically improved user experience, most chatbots are still being used to provide information rather than solve complex processes," says Pradeep Rajendran, Technology Leader, Federal Reserve Bank of St. Louis.

"Technologies like data analytics and machine learning have the potential to eliminate the blind spots that have existed, inefficiently identifying customer requirements and fulfilling them. By using these technologies effectively, more & more brands and businesses are transitioning from a

reactive to a proactive approach to delivering superior customer service and driving positive customer experiences.

If they can do this strategically, brands and businesses can benefit from conversational AI tools like chatbots not just to automate marketing and business processes but ultimately do what every business in today’s day and age seeks to do: offer an unparalleled experience to the end user," says Aakrit Vaish, Co-Founder & CEO, Haptik.

"Chatbots are rapidly changing the travel industry by facilitating human-like interaction with customers for faster response times, better booking prices and travel recommendations. AI-driven algorithms personalize the user experience, increase sales and build loyal and lasting relationships. Companies use artificial intelligence to deploy chatbots, predict purchases and gather data to create a more customer-centric experience. Marketers are allocating more budgets for artificial intelligence implementation as machine learning has dozens of uses when it comes to successfully managing marketing campaigns. It is helping marketers build in-depth customer insight reports, power pertinent content creation and book more impactful business meetings - all without a large human influence and with better perfection," says Ajay Kumar Jha, Ex-General manager IT, Reliance Communication Infrastructure.

Conversational AI - Before and Today!

Chatbots have become even more capable now, and chatbot developers of all sizes are making inroads into using NLP capabilities. They understand human language much better and faster.

Increase in Virtual Assistants

Conversational AI will enable virtual assistants to perform increasingly difficult tasks. For example, in the coming days, these gadgets might analyze your feelings to determine whether your interactions with a virtual assistant are beneficial or negative.

Combating Fake News and Curbing Negative Content Across Social Media

The bots' sentiment analysis and emotion identification capabilities will advance in great detail and accuracy. Companies will find it much simpler to monitor social media if they have NLP-powered bots that can identify and reply to unfavorable reviews and comments.

Boosting Sales

Chatbots - especially those that integrate with eCommerce - will be crucial to eCommerce businesses' efforts to boost sales by assisting customers in finding what they're looking for. Consumer satisfaction will increase if complex consumer questions are addressed and clients are given round-the-clock assistance.

Chatbot-based Payments

Although chatbot-driven payments are still relatively new, 2025 will see a greater uptake of this technology. Payment gateways like Razorpay, Stripe, and PayU will make life a lot easier for companies and customers, and many chatbot providers will be able to provide strong payment connections.

Enhancing the Gaming Experience

Conversational AI is making a wide range of new improvements possible, including in-game dialogues that closely resemble in-person interactions and tailored gaming support to facilitate more seamless encounters.

Holiday Planning

Regarding hospitality and tourism, Conversational AI can also handle the full booking, reservation, and pre-payment processes so clients don't have to wait for a staff member to finish them. This can also include scheduling a concierge service or ordering food for delivery or takeout.