Chatbot firms in India to generate over 20% of digital customers' revenue

With a rising number of digital commerce firms employing their services, chatbots may generate about $12 billion in business revenue in three years. This is according to Swapan Rajdev, the chief technology officer and co-founder of Jio Haptik, a leading player in the chatbot world. Digital commerce firms range from companies engaged in e-commerce and insurance to financial services, banking, travel, hotels, and gaming.

Over the next three years, chatbot companies in India are projected to generate over 20 per cent of business revenues of their customers that run digital commerce platforms, thanks to technologies such as the artificial intelligence (AI)-based ChatGPT.

With the use of ChatGPT, the conversations that bots have with customers will become more natural, conversational, and sympathetic.    

Rajdev, in whose firm Reliance has a majority stake, says that while figures are hard to come by, his estimates suggest that Haptik’s small and medium enterprise (SME) clients currently generate as much as 50 per cent of their business revenues through chatbots.

It's a very different story for big companies; it’s only 3-4 per cent for them.

“In the next three years, the India average could easily hit 20 per cent,” says Rajdev. “We also believe that in the same period globally, chatbots will generate over $40 billion of business revenue and about 30 per cent of that will come from India. Companies like us are already global with businesses in the US and Southeast Asia. So are others.”

Haptik has been using generative AI GPT for over four to five years, including its new versions. But the current buzz around ChatGPT has made it popular, with more people understanding it.

The use of Meta’s WhatsApp — the most popular platform for chatbot conversations — has also given it a visibility boost. Meta charges companies for a 24-hour time-bound transaction that could include many conversations initiated by the company or the customer.

Other users include Instagram, Facebook Messenger and company websites. In the US, however, SMS still reigns supreme.

Rajdev makes a distinction. General AI GPT chat is able to offer answers on anything by drawing on the gargantuan information base offered by the internet. This is very different from the domain-specific chatbots that Haptik offers to enterprises where the conversations have to be specifically tailored to the business and its products.

“What we are working on is how we can marry ChatGPT and the world’s knowledge to make it available for the more specific needs of our domains,” said Rajdev.

For example, ChatGPT cannot be controlled, so Haptik is working on building an editorial tool to ensure that it offers relevant answers that the enterprise wants.

Further, the technology can be used to train bots to have more empathy while addressing issues such as a customer’s order failing to reach them or the product the customer wants being unavailable.

Haptik competes with companies like Gupshup and Yellow, which are also working in the same domain.

Given that Google, Microsoft and Meta are all pouring big money into ChatGPT and will want to  monetise it, surely the chatbot business will face competition from these giants too?

“We are not at all worried about whether they will eat into our business. They are already in the bot business. Google has dialogue flow and Microsoft has bot builder. Their core business is search and advertising. We are in the enterprise business,” says Rajdev.      
 

How ChatGPT is pushing the chatbot business 

• In the next three years, the chatbot business will generate over $40 billion in revenues for its digital commerce customers globally. India’s share will be around 30 per cent
• Currently, while SMEs are able to generate 50 per cent of their business from chatbot conversations, it is only 3 per cent for big companies. In three years, this equation will change
• Chatbot companies are looking at marrying the new ChatGPT technology with their requirements in specific domains
• Chatbot players do not see competition from Google or Microsoft as a threat as they are already established in the business