These days, chatbots are all the rage. Or at least, it seems that way.
When it comes to marketing, sales, and support, it seems that every major company and influencer is ranting and raving about the importance of chatbots as the next wave.
And, no doubt, many popular sites and companies are deploying chatbots to increase the efficiency of their operations and provide an improved customer experience.
But, when we zoom out, what is the actual state of chatbots in today’s landscape?
How common are chatbots in 2018? Which industries use chatbots the most? What types of companies are deploying chatbots and in which industries?
To find out, we conducted some research into how chatbots are being deployed. Using data gathered by NerdyData, we collected a sample of more than 20,000 worldwide businesses using popular chatbot tools like Intercom, Drift, and ManyChat. Using the company URL, we enriched this data using the ClearBit API to gather data about the companies using chatbots.
In our first-ever State of Chatbots 2018 study, we found some interesting data on when, where, and how frequently chatbots are being used by both B2B and B2C companies.
Here’s a summary of what we learned:
Let’s dig into the data further.
First things first--let’s level set on the definition of a chatbot.
For the purposes of our research, we narrowly defined the chatbot as an interface that immediately responds to text inputs. This chatbot on the Drift homepage is a perfect example:
We didn’t include other forms of live chat. And, because we were conducting observational research, we don’t have any data on behind-the-scenes use of bots or AI-assisted communications.
Nevertheless, we can learn a lot about the chatbot market by examining websites and their current use of the technology. So that’s what we did.
This may not come as a big shock, but one of the first major findings from our research is that B2B companies tend to use chatbots on their website more frequently than their B2C counterparts.
Our analysis found that 58% of companies with chatbots were categorized as B2B whereas only 42% were B2C sites.
This makes sense as chatbots are a great way to capture business leads. SalesRabbit is one company that uses a chatbot as the first step in the lead generation process:
That’s not to say that B2C companies aren’t also using chatbots, of course. While they were less prevalent in our research, we did find plenty of examples of B2C companies using chatbots to connect with prospective customers directly and offer incentives to interact or opt-in to an email list.
Several companies offered something for free (aka a lead magnet) to encourage visitors to interact with their chatbots and become customers.
For example, Survival Life offers free survival gear:
If you agree to connect with them on Facebook Messenger, then you’ll interact with their chatbot on Facebook Messenger:
There are a few different workflows and strategies that different companies deploy. We also found that there are many different chatbot technologies being used, sometimes with multiple solutions within a single workflow.
In our research, we were able to enrich the data on companies using chatbots to learn about the specific industries, verticals, and other company characteristics.
Among the starkest findings: The overwhelming domination of internet and software companies when it comes to chatbot software.
Of the companies that had available industry data, nearly half of the companies with chatbots fell into this category.
This paints a clear picture for the opportunity to expand outside of technology and software. Chatbot adoption is still sparse in industry verticals like healthcare, media, hotels and leisure, and others found in our research.
If you’re in a less technical industry (like Real Estate), then it’s more likely that your visitors will respond to your chatbots.
One of the most surprising findings in our analysis was the size of companies with chatbots deployed.
Of the sites analyzed, we found that companies with between 1 and 50 total employees made up the bulk of those using chatbots--a combined 71% of companies that had available company size data.
While there are many more companies with 1-50 employees, than, say, enterprise firms with more than 1,000 employees, we would expect that the distribution of chatbots will follow a linear model with large firms making up the smallest percentage of companies using chatbots.
Instead, we found that mid-market companies (250-1,000 employees) are actually the least represented in our data, making up just 3.6% of companies with chatbots and available company size information.
It does seem plausible that smaller companies would likely use chatbots more frequently, due to the convenience and efficiency versus having a full-time staff to respond to chat requests.
Even so, there’s still a gap in the market for mid-size firms, who may not be taking advantage of the convenience and efficiency of chatbots at the same rate as other firms. For chatbot vendors, this definitely seems like a market opportunity to sell established companies on the benefit of automated chat technology.
We also analyzed chatbot adoption by the company’s country of origin.
Our data show that the US leads the world in chatbot adoption, but not be a significant margin when controlled for population size.
The US (at 325 million) is much bigger than the UK (65 million), Canada (36 million), and Australia (24 million).
This means that while America has the most chatbots (more than 15,000 of the sites analyzed), its chatbot to population ratio is only slightly higher than other English-speaking countries.
It does seem that other large, western democracies are lagging behind in terms of adoption. France and Germany, for instance, have a chatbot adoption rate of roughly 1/10th to 1/5th of the per-capita rate in the US.
Again, we see a clear market opportunity for chatbot vendors who may not be meeting the needs of international companies.
After dissecting the companies with chatbots, we wanted to take it a step further to analyze how frequently chatbots are deployed in the wild.
This is more difficult to measure because you must start with some kind of sample of companies to analyze and then review each site to determine if a chatbot has been deployed.
In order to approximate the prevalence of chatbots on popular B2B sites, we analyzed the sites of 1,000 trending companies on Crunchbase in 10 different industries (Artificial Intelligence, Content and Publishing, Data and Analytics, Education, Energy, Financial Services, Healthcare, Manufacturing, Sales and Marketing, and Real Estate).
From this data set, we concluded that the vast majority of B2B sites do not use chatbots. Overwhelmingly so, in fact.
According to our analysis, only 1 in every 200--or 0.5%--of B2B websites are using chatbots in 2018.
This tells us that for all of the hype and discussion about the importance of using chatbots, the actual adoption rate is still low. Chatbot technology is still in its infancy--and it seems likely that there will be a significant increase in the coming years.
To figure out the characteristics of sites that use chatbots, we used NerdyData to find sites that use popular chatbot software. We found over 20,000 sites that use ManyChat, Intercom, or Drift as a chatbot--excluding sites that solely use these services for live chat.
We then used Clearbit to analyze this list of domains to find more information about the businesses behind these sites.
Clearbit didn’t provide information on every single site. In those cases, we performed analysis only on the sites that had chatbots and also had available data for the characteristics that we were studying.
Our results reflect this methodology.Our biggest takeaways:
Keep in mind that chatbots are still quite new.
Drift was only founded in 2014, but they’ve already raised $100 million in investor funding. Intercom was founded in 2011 and has raised over $240 million in investor funding.
This is a huge signal that the chatbot industry is just beginning and is going to grow rapidly in the near future. We expect to see chatbot adoption to grow rapidly as the market matures, prices decrease, and the barrier to entry is softened.
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