Interactive Voice Response Market Size

Interactive Voice Response Market Overview

The Interactive Voice Response Market size is projected to grow from USD 10.40 Billion in 2024 to USD 17.15 Billion by 2032, exhibiting a compound annual growth rate (CAGR) of 6.44% during the forecast period (2023 - 2032). Additionally, the market size for interactive voice response was valued at USD 9.7 billion in 2023.

A rise in demand for improving customer relationship management is the key market driver enhancing market growth. Additionally, rising cloud-based IVR, customized IVR, and IVR payment processing adoption are projected to expand the market.

Figure 1: Interactive Voice Response Market Size, 2023-2032 (USD Billion)

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

Interactive Voice Response Market Trends

Increase in the number of phone calls is driving the market growth

Market CAGR for interactive voice response is driven by the rising number of phone calls. The market for IVR systems has been driven by increased client calls. The quantity of calls has increased, making it difficult for the agents to observe adequate call turnover. As a result, businesses use IVR systems to handle the growing amount of calls and boost client connection. The drop-off time and hold time for each call are decreased through the use of voice technology and dual-tone technology. As a result, there are now more outbound calls, which leads to the automation of tedious jobs, boosts agent productivity and drives the market for IVR systems.

The development of artificial intelligence is creating the potential for digitalization across industry verticals. The prevalence of AI-powered devices suggests that systems and search algorithms have advanced to enhance machine learning and its practical uses. A key illustration is Google's RankBrain, which uses phrase and word recognition to learn, comprehend, and improve outcome prediction. Machine learning and natural language processing algorithms are used to transcript voice searches. Web conferencing tools have also become more commonplace in the sector. Web conferencing can be made even better with speech and voice recognition technologies by offering post-call transcripts via call-based real-time captioning. One of the top applications with the most potential for economic impact is online conference transcription, which, according to the Speechmatics Voice research, will account for around 44% of the interactive voice response market share in 2021. Thus, driving the interactive voice response market revenue.

Interactive Voice Response Market Segment Insights

Interactive Voice Response Solution Insights

The interactive voice response market segmentation, based on solution, includes call routing, outbound, and self-service. In 2022, the call routing category dominated the market. One of a contact center platform's most crucial business phone functions is voice-over-internet-protocol (VoIP) call routing. It has several advantages for any organization that values the complete customer experience, not just for clients that require prompt responses. However, in 2021, the outbound calls sector saw significant growth. In today's digital environment, conversations through social media, Texting, email, and chatbots can lose the human element of meaningful dialogue. Speaking with a real-life representative can improve the customer experience by personifying brands. Also, outbound calls thrive in demonstrating proactivity and responsiveness in meeting consumer needs.

Figure 2: Interactive Voice Response Market, by Solution, 2022 & 2032 (USD billion)

Source: Primary Research, Secondary Research, MRFR Database and Analyst Review

Interactive Voice Response Technology Insights

The interactive voice response market segmentation, based on technology, includes speed based, touch-tone-based, and text-to-speech. In 2022, the speed based segment held a commanding share in terms of revenue. Implementations of speech recognition are ideal for use in cars and mobile phones. Accessibility to data and services must be possible at all times and in all places due to society's growing mobility. The customer experience can be greatly improved by using cloud- and client-based voice recognition and businesses can maximize cost savings.

August 2021: LumenVox, a leading provider of speech and voice technologies, announced the release of its next-generation Automatic Speech Recognition (ASR) engine with transcription today. The new Automatic Speech Recognition engine, based on artificial intelligence (AI) and deep machine learning (ML), outperforms its competitors in delivering the most accurate speech-enabled consumer experiences.

Additionally, in 2022 the text-to-speech sector witnessed the fastest growth rate. The text-to-speech segment is expanding due to rising consumer desire for mobile devices and an increase in the number of persons with learning difficulties and visual impairments. The sector for text-to-speech is also growing as voice assistants and smart speakers become more widely used.

Interactive Voice Response Deployment Insights

The interactive voice response market segmentation, based on deployment, includes cloud and on-premise. With the rising demand for cloud solutions, the cloud category is anticipated to grow at the greatest CAGR. Throughout the projection period, cloud deployments are anticipated to be driven by enterprises' growing embrace of cloud technologies. However, due to the growing acceptance of cloud-based solutions among Small and Medium-sized Businesses, the on-premise category is anticipated to have a slow demand during the projected period (SMEs).

Interactive Voice Response Regional Insights

By Region, the report provides market insights into Asia-Pacific, North America, Europe, and Rest of the World. Europe’s interactive voice response area will dominate this market because voice assistants have become more innovative and advanced, supporting French, Spanish, Russian, and other European languages. For instance, Sestek, a business that creates artificial intelligence-powered solutions using text-to-speech, speech recognition, natural language processing, and voice biometrics technologies, provided ING Bank with its speech analytics solution, which also led to a 10% increase in net promoter score, a 15% increase in sales quantity score, and a 3% decrease in overall over-silence rate. It is anticipated that the results attained by end-user business clients would increase demand for interactive voice response in the European market. Further, the German interactive voice response market held the largest market share, and the UK interactive voice response market was the fastest-growing market in the European region.

Further, the leading countries studied in the market report are U.S., Canada, German, UK, France, Spain, Italy, Japan, China, Australia, India, South Korea, and Brazil.

Figure 3: INTERACTIVE VOICE RESPONSE MARKET SHARE BY REGION 2022 (%)

Source: Secondary Research, Primary Research, MRFR Database and Analyst Review

North America’s interactive voice response market accounts for the second-largest market share. The key elements propelling the growth of the interactive voice response market in North America are improvements in the technology for faultless communication and security, as well as the simplicity of completing a task without the assistance of an agent. The U.S.'s early adoption of cutting-edge technology like artificial intelligence (AI) and natural language processing (NLP) has increased demand throughout North America.

The Asia-Pacific Interactive Voice Response Market is expected to grow at the fastest CAGR from 2023 to 2032. It is projected that the increased use of AI technology in the BFSI, healthcare, automotive, and government sectors will accelerate the regional adoption of voice technology. China is expected to adopt interactive voice response technology quickly. The head of the council of the Speech Industry Association of China (SIAC) and the chairman of iFlytek, a well-known Chinese AI company, claim that the demand for speaking engagements is driving a rapid increase in the number of smart devices. The number of engagement services managed by the company's voice assistants also surged by 84% in 2021 compared to the previous year. Moreover, China’s interactive voice response market held the largest market share, and the Indian interactive voice response market was the fastest-growing market in the Asia-Pacific region.

Interactive Voice Response Key Market Players & Competitive Insights

Leading market players are investing heavily in research and development to expand their product lines, which will help the interactive voice response market, grow even more. Market participants are also undertaking various strategic activities to expand their footprint, with important market developments including new product launches, contractual agreements, mergers and acquisitions, higher investments, and collaboration with other organizations. To expand and survive in a more competitive and rising market climate, the interactive voice response industry must offer cost-effective items.

Manufacturing locally to minimize operational costs is one of the key business tactics manufacturers use in the interactive voice response industry to benefit clients and increase the market sector. In recent years, the interactive voice response industry has offered some of the most significant advantages to medicine. Major players in the interactive voice response market, including Avaya Inc. (U.S.), AT&T Inc. (U.S.), Verizon Communications Inc. (U.S.), Nuance Communications Inc. (U.S.), and others, are attempting to increase market demand by investing in research and development operations.

Avaya Holdings Corporation, commonly abbreviated as Avaya, is a worldwide technology firm headquartered in Durham, North Carolina, that provides cloud communications and workstream collaboration services. The company's platform offers unified communications (UCaaS), a contact center, and other services. The organization serves 220,000 customer locations throughout 190 countries. In March 2021, Avaya, a leader in communications and collaboration solutions, unveiled new features for Avaya Spaces, the modern workstream collaboration (WSC) platform that provides advanced Unified Communications capabilities via a user's preferred device. AI-enhanced meetings and easier, integrated audio and video calling enabled by Avaya OneCloudTM CPaaS (Communications Platform as a Service) may now be extended with Avaya Spaces.

Genesys, also known as Genesys Telecommunications Laboratories, Inc., is a software firm based in the United States that sells customer experience (CX) and call center technologies to mid-sized and big enterprises. It sells cloud-based as well as hybrid cloud software. The company was created in 1990 and was acquired in February 2012 by investment firms Permira Funds and Technology Crossover Ventures (TCV). In December 2020, Genesys announced the creation of Genesys Digital, a new business unit designed to assist businesses in meeting the newest technological developments and consumers' ever-changing expectations in the digital realm. Consumers' lives are becoming increasingly digital, blurring the barriers between marketing, sales, and service for firms. Companies realize the strategic value of orchestrating every consumer touchpoint.

Key Companies in the interactive voice response market include

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  Nuance Communications Inc. (U.S.)

  
  


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  Avaya Inc. (U.S.)

  
  


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  Cisco Systems Inc. (U.S.)

  
  


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  Convergys Corporation (U.S.)

  
  


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  AT&T Inc. (U.S.)

  
  


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  West Corporation (U.S.)

  
  


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  Genesys Telecommunication Laboratories Inc. (U.S.)

  
  


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  Verizon Communications Inc. (U.S.)

  
  


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  IVR Lab (U.S.)

  
  

Interactive Voice Response Industry Developments

HDFC Bank (HDFC), launched three new digital payment products on Unified Payments Interface (UPI): UPI 123Pay (Payment by IVR), a plugin for UPI services for merchants and AutoPay through QR. These solutions will transform how customers and retailers interact in an uninterrupted manner, stated the lender. With the UPI 123Pay feature, you can make digital payments without needing an internet connection. Users can do some offline steps and pay via UPI, irrespective of their phone type.

In June 2023, Punjab National Bank (PNB) introduced a voice-based digital payment solution—UPI 123PAY—in association with the National Payments Corporation of India. It is meant to bring UPI benefits to areas where there is no access to the internet and those people who don’t have smartphones. The Unified Payments Interface (UPI)—a safe payment solution for real-time, 24/7 transactions. It allows for a similar way of payment by using a feature phone, just as it does with 123PAY UPI. Users can make transactions using this platform by calling an IVR number.

TeamSense has an app-free suite of tools created specifically for hourly workers launching a new product that guarantees ALL employees have the same access to their innovative absence reporting tool. TeamSense developed this voice-based absence reporting product directly integrated into their flagship system for the small fraction (<3%) who do not have access to smartphones or email addresses. Cold and flu season, followed by holidays, the global pandemic, and supply chain disruptions – thus resulting in increased unexpected absences are all self-explanatory reasons why we need such a product in place now. The company has made it available as an add-on feature within all its pricing packages under TeamSense’s offerings. TeamSense was born out of necessity in 2020, initially as a COVID symptom attestation tool used by deskless employees, but was later bought out by Fortive, an industrial tech company, in July 2021.

Interactive Voice Response Market Segmentation

Interactive Voice Response Solution Outlook

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  Call Routing

  
  


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  Outbound

  
  


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  Self-Service

  
  

Interactive Voice Response Technology Outlook

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  Speech Based

  
  


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  Touch Tone Based

  
  


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  Text to Speech

  
  

Interactive Voice Response Service Outlook

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  Maintenance & Support

  
  

Interactive Voice Response Deployment Outlook

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  Cloud

  
  


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  On-Premise

  
  

Interactive Voice Response Regional Outlook