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The global product analytics market size was USD 5.25 billion in 2020 and is projected to grow from USD 5.93 billion in 2021 to USD 16.69 billion in 2028, at a CAGR of 15.9% during the 2021-2028 period. The impact of COVID-19 in the market has been exceptional and surprising, with components witnessing a diverse demand across the region during the pandemic. Based on our research, the global market share exhibited a substantial growth of 12.6% in 2020, as compared to the average year-on-year growth during 2017-2019.
The growing demand for product analytics software from end-users, such as e-commerce, customer tech and media are anticipated to drive the market demand. The increased use of product analytics across all digital platforms helps leverage insights into customer experience, which are a few major factors that are expected to create market opportunities in the coming years. For instance,
COVID 19 Pandemic to Create Significant Growth Opportunities for Product Analytics Market
The outbreak of COVID-19 has posed a unique challenge for end-use enterprises to spend over product analytics. Organizations leverage software to optimize existing business operations and improve engagement across e-commerce, customer tech and media, among other industries.
The COVID-19 has driven the need for this service solution. Also, end-use industries across the globe have started adopting product analytics and the demand for collaborative digital workflow has significantly increased during remote working culture; this has resulted in increased adoption of product analytics software. For instance,
The pandemic has led governments across regions to implement product analytics and artificial intelligence technology for managing uncertainty in real-time. This has helped the market to grow rapidly during the pandemic. With the help of product analytics, organizations were able to engage customers through digital channels, manage complex and fragile supply chains and support workforces through disruption to their lives and works. As a result, COVID 19 has sparked uncertainty, disturbed the global financial market, and diverted global firms' activities.
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Advanced Analytics and Artificial Intelligence (AI) Integration with Product Analytics to be an Emerging Market Trend
Artificial Intelligence (AI) has changed the way digital solutions work. Hence, while choosing product analytics, key vendors look for advanced analytics and artificial intelligence (AI) capabilities. Artificial intelligence and advanced analytics-based software help organizations that enable product teams to analyze, visualize and track customer behavior and engagement data. Also, it allows product managers and teams to evaluate the effectiveness of the digital experiences they create and provides crucial data for optimizing performance, diagnosing issues, and correlating customer behavior with long-term value.
Increasing Need to Improve Customer Behavior Management to Aid the Market Growth
The increasing need for product recommendation engines that provide personalized service to end users is increasing day by day. These recommendation tools help organizations increase the potential of their marketing efforts by optimizing customer behavior and service efforts. According to the Harvard Business Review report, personalization of products can help deliver eight times more rate of investment on marketing and help improve sales by more than 10%.
Further, predictive recommendation enables end users or retailers to deliver the right offers at the right time that results in conversion of money spent per transaction. The end user’s interest is demonstrated through their history and behavior, which allows the product recommendation tool to automatically pair that behavior with the right suggestions. Hence, product analytics plays a very important role in analyzing customer behavior.
Increased Demand for Cloud-Based Analytics Solutions to Fuel the Market Growth
Cloud-based analytics helps in analyzing the data using cloud computing with the assistance of a wide range of analytics techniques and tools. Cloud analytics helps organizations extract massive data and present it readily available via the web browser.
The innovation benefits provided by product analytics providers directly impact the enterprise business value, particularly for key market players. Also, cloud analytics platforms allow agile customization to the enterprise's unique aspects. For instance,
Further, cloud-based analytics helps customers provide consistent, up-to-date, and personalized experiences.
Privacy and Security Issues to Hamper Market Growth
Technologies including artificial intelligence and machine learning are among the best technologies in an organization’s cyber security resource. Also, these technologies are more likely to malicious attacks, as cyber hackers are adopting AI and ML much faster than security leaders. The use of such technologies by attackers impact business data and assets; this is considered to be the restraining factor for the market. Organizations using this service are concerned about the data leak over the internet that unauthorized users can easily access.
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Software/Tools to Lead Market Owing to the Rising Demand from E-Commerce and Fintech
The market is divided into software/tools and services based on the component. The software/tools is projected to hold the highest product analytics market share. The demand for tools, such as google analytics, amplitude analytics, and others is driving this expansion. Key players are expediting their efforts on creating and delivering advanced product analytics solutions for various industries, including e-commerce, financial & banking, consumer technology and others. For Instance,
The services segment is predicted to rise at a significant CAGR throughout the projection period due to the increased usage of digital devices such as mobiles, tablets, laptops, and others.
Increasing Popularity of Product Analytics among E-Commerce to Gain Traction
The market is classified into e-commerce, fintech, consumer tech, and media, based on the end-user. The e-commerce industry is expected to fuel the market during the forecast period. This is primarily due to the increased adoption of mobile technologies and soaring internet usage with rising disposable income. Customers are also becoming stronger and more aware of their requirements and potential solutions. They are investing their money in online retail networks to propel e-commerce forward.
The fintech industry is expected to rise at the highest CAGR during the forecast period. Increased demand for improved customer interaction and business analytics in the banking and finance sectors will aid market growth. Additionally, the growing adoption of automated virtual financial assistants in fintech organizations will also help boost the market. Furthermore, consumer tech and media industries are expected to grow at a steady rate owing to rising internet penetration and digitization.
North America Product Analytics Market Size, 2020 (USD Billion)
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Geographically, the market is segmented across five major regions, namely, North America, Europe, Asia Pacific, the Middle East & Africa, and South America
North America is expected to have a significant market share owing to the early implementation of modern technologies, robust economic landscape, and digital usage. Additionally, major firms, such as Amplitude, Inc., Heap, Inc., Mixpanel, Pendo.io, Indicative Inc. and others, have contributed to the region's success. Furthermore, increased investment by key companies to extend their global footprint is likely to drive market growth in North America. For Instance,
Key Players in Europe are increasingly embracing the concept of product analytics software that is boosting the growth of the product in the region. Investments by key players, government projects, and increasing funding in research and development activities are driving factors for the region’s growth.
Asia Pacific is predicted to grow fastest during the forecasted period. The focus of major companies in India, Japan, China, Australia, and other countries is on digitized applications. These countries have a considerable number of small and medium businesses (SMEs) in the e-commerce industry. The countries in the APAC region, including Australia, China, and others are adopting product analytics tools, implementing business intelligence in their banking, financial services and e-commerce sector. These factors will contribute to the product analytics market growth in the near future.
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In particular, South America and the Middle East and Africa regions are likely to rise significantly. Owing to increased investment in digital projects and government initiatives in Iran, Brazil, Israel, Turkey, and other nations are primarily contributing to the growth. For instance, in June 2021, International Financial Corporation (IFC) launched DigiLab program in the Middle East and Africa. This launch will help financial institutions in improving digital services. Similarly, in November 2021, Virgin Mobile launched a digital carbon offsetting app. This app will be soon launched in Kuwait, Oman and Saudi Arabia. Further, the launch of all such digital projects is anticipated to drive the growth of the market in the region.
The Emphasis of Key Players on Partnerships and Acquisition to Strengthen Competition
Amplitude Inc., Heap, Inc., Mixpanel, Pendo.io, Gainsight, Hevo Data, Inc., Fullstory, Inc., Looker Data Science, Inc., PostHog, Inc., Indicative Inc., Woopra, Inc., and others are some of the key players in the market. Major players in the market are currently deploying product analytics software integrated with advanced analytics and artificial intelligence among others. Additionally, the rising market competition is forcing key market players to focus on the acquisition strategy for strengthening their positions. For instance,
An Infographic Representation of Product Analytics Market
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The market research report study analyses leading regions throughout the world to provide a better knowledge of the user. In addition, the research analyses technology adopted at a rapid worldwide level and provides insights into the recent industry and market trends. It also highlights some of the market's growth-stimulating elements and restrictions, allowing the reader to obtain a thorough understanding of the market.
Value (USD Billion)
Component, End-user, and Region
According to Fortune Business Insights, the global market is expected to reach USD 16.69 billion by 2028.
Fortune Business Insights says that the market value stood at USD 5.25 billion in 2020.
By 2028, the market size is expected to reach USD 16.69 billion.
The market is expected to grow at a CAGR of 15.9% in the forecast period (2021-2028).
By component, the software and tools is expected to lead the market during the forecast period.
Increasing need to improve customer behavior management to aid the market growth.
Amplitude Inc., Heap, Inc., Mixpanel, Pendo.io, Gainsight, Hevo Data, Inc., Fullstory, Inc., Looker Data Science, Inc., PostHog, Inc., Indicative Inc., Woopra, Inc., are the top companies in the market.
By End-user, the E-commerce holds the major market share.
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