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The predictive analytics market size is estimated to grow at a CAGR of 22.24% between 2022 and 2027. The market size is forecast to increase by USD 2,1601.17 million. The growth of the market depends on several factors, including the growing need to detect fraud and scams, the adoption of analytics to achieve customer centricity and the increasing data generation and the advent of big data. Predictive analytics is a branch of analytics that leverages advanced artificial intelligence (AI) and machine learning algorithms to make future predictions and assessments based on the analysis of historical data.
This predictive analytics market report extensively covers market segmentation by end-user (BFSI, retail and e-commerce, telecom and IT, transportation and logistics, and others), deployment (cloud-based and on-premise) and geography (North America, Europe, APAC, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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The growing need to detect fraud and scams is a major factor notably driving the market growth. The demand for fraud detection in the social and mobile world is driving the predictive analytics market. With advancing technology, fraud and scams are becoming more sophisticated and serious threats to data security and privacy. This has led to a rise in concerns about these threats, prompting enterprises across different industries to adopt predictive analytics in their business processes. By doing so, they aim to prevent future frauds and scams from occurring.
However, by combining multiple algorithms and analytics paradigms, these solutions can detect fraudulent activity patterns and prevent criminal behaviour. Predictive analytics can also be used to identify network security issues and vulnerabilities, leading to increased use cases across various sectors such as pharma, BFSI, and healthcare. For instance, insurance companies and underwriters in the BFSI sector can create predictive models to anticipate the likelihood of fraud during the claims process. These models utilize historical claims data to flag any present or future claims that resemble previous frauds or scams. Hence, the predictive analytics market is driven by the growing need to detect fraud and scams in today's business environment.
Increasing adoption of real-time data analytics is an emerging trend shaping market growth. The predictive analytics market is experiencing a significant trend where real-time data analytics and live stream analysis are becoming more widely adopted and accepted. Real-time data analytics involves analyzing data in motion using advanced ML and AI algorithms. Organizations are increasingly moving toward advanced analytics and cutting-edge techniques, resulting in a higher demand for real-time data and streaming analytics. Predictive analytics can be applied in countless use cases in the age of mobility and social media phenomenon. Furthermore, the increased use of advanced sensors and IoT is expected to boost the role of real-time data analytics. For instance, predictive analytics can directly consume sky-drone data to conduct real-time analysis of the dataset and provide intelligent insights
However, live streaming on Facebook presents a unique opportunity for streaming analytics to gather valuable insights into human behaviour from vast amounts of unstructured data generated from each transaction. As there is an increased emphasis on enterprise data security, real-time and streaming analytics is expected to see greater acceptance in the IT security field. With the adoption of IoT and AI in various business processes, the need for advanced analytics solutions that can interpret complex and unstructured data produced across critical processes has grown. The predictive analytics market is being propelled by growing technological advancements such as advanced sensors and IoT, coupled with the widespread use of social media and mobility phenomenon, which is fueling the adoption of real-time data and streaming analytics worldwide
Accessibility issues for quality and standardized data are a significant challenge hindering market growth. A significant obstacle in implementing and using predictive analytics solutions is the lack of access to reliable historical data. To arrive at accurate predictions of future trends, predictive analytics solutions require high-quality historical data. The quality of the output is directly influenced by the quality of the dataset used. Relevant data is often spread across various databases, repositories, systems, and processes within an organization, which can lead to difficulty in accessing it. This issue is compounded by the inconsistency of the data and the existence of data silos.
Moreover, many enterprise data sets are filled with noise, and some don't meet the necessary quality and accuracy requirements for use in predictive modelling. This lack of uniformity across an organization results in added expenses for data cleaning and transformation. Additionally, the human bias involved in data collection and selection processes can decrease the effectiveness of predictive models, potentially hindering growth in the predictive analytics market during the forecast period.
The market share growth by the BFSI segment will be significant during the forecast period. In 2022, the banking, financial services, and insurance (BFSI) industry held the largest market share in the global predictive analytics market. Predictive analytics supports banks and financial institutions to predict consumer behaviour and preferences.
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The BFSI segment was valued at USD 1,471.98 million in 2017 and will continue to grow by 2021. Understanding customer patterns gives businesses in the BFSI industry a competitive advantage in forecasting and making decisions, which allows these institutions to put client interests first. In addition, previous data allows business leaders in the predictive analytics market, such as Microsoft Corp., Oracle Corp., and others, to make informed decisions. Data analysis allows banks and other financial institutions to react to transforming market conditions, determine risks, make forecasts based on past consumer behaviour, and identify new opportunities for themselves and their customers. Therefore, predictive analytics will continue to play a significant role in the BFSI industry, driving the growth of the predictive analytics market during the forecast period.
The predictive analytics market was dominated by the cloud-based segment in terms of market share in 2022. From the company perspective, the cloud-based segment is a lucrative deployment model, primarily due to the easy AI and cognitive function integrations, superior scalability, flexibility, effective capacity management, low investment, and a predictable revenue curve. The low investment may be a boon for vendors as it leads to cost-effective revisions and upgrades of the offering to align it with the buyer's needs or a market where the buyer's expectations are not concrete. Furthermore, the advent of cloud computing and SaaS, AIaaS, the emergence of SMEs, increased awareness, and innovations in data security, along with the inherent cost-effectiveness and flexibility of the cloud-based model, are the primary drivers for this market segment. Hence, such factors will fuel the growth of the predictive analytics market during the forecast period.
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North America is estimated to contribute 30% to the growth of the market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. For predictive analytics, North America holds the largest market share, mainly because it was an early adoption of advanced technology, and it is directing the intensive generation and consumption of data in the world.
In addition, the massive amounts of data produced in this region drive the market for advanced analytics to consume the data and discover intelligent relationships and insights. Furthermore, the region is tech-mature, and the industrial sector across the region is completely developed, which is leading to the easy adoption of advanced software solutions to drive efficiency and productivity.
However, predictive analytics has offered buyers the opportunity to mine their own documented data to find attractive and intelligent insights which can enhance processes and drive superior return on investment, and therefore, help institutions to acquire a competitive advantage. Further, the strong presence and penetration of significant companies in the region to contribute to the overall market growth. For instance, the Bank of America is leveraging a virtual assistant named Erica, which uses predictive analytics to provide financial guidance to bank customers. Hence, the overall maturity of the industrial sector, the intensive rate of data generation, and the fact that the region is the major adopter of advanced technology for driving enterprise productivity are some of the primary drivers of market growth in the region.
In 2020, the COVID-19 pandemic moderately impacted the regional predictive analytics market. Sophisticated technologies such as analytics, artificial intelligence, and machine learning were widely used by healthcare facilities to analyse complicated data related to the pandemic. Nevertheless, the large-scale COVID-19 vaccination drives conducted by governments in the region led to the lifting of the lockdown restrictions and revived the demand for predictive analytics across all end-user sectors, including BFSI, transportation and logistics, and others. This led to the operations in end-user industries resumed, and the demand for predictive analytics tools increased. The increasing volumes of data and the need for forecasting are anticipated to drive the growth of the regional predictive analytics market during the forecast period.
The Predictive Analytics Market report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Predictive Analytics Market Customer Landscape
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Altair Engineering Inc. - The company offers predictive analytics namely Altair Knowledge Studio which brings transparency and automation to machine learning.
The research report also includes detailed analyses of the competitive landscape of the market and information about 20 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The predictive analytics market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
Predictive Analytics Market Scope |
|
Report Coverage |
Details |
Page number |
182 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 22.24% |
Market growth 2023-2027 |
USD 2,1601.17 million |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
20.44 |
Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
Performing market contribution |
North America at 30% |
Key countries |
US, China, Japan, Germany, and UK |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Altair Engineering Inc., Alteryx Inc., Amazon.com Inc., Board International SA, Cloudera Inc., Domo Inc., Fair Isaac Corp., Hewlett Packard Enterprise Co., Hitachi Ltd., International Business Machines Corp., KNIME AG, Microsoft Corp., Nippon Telegraph and Telephone Corp., Oracle Corp., QlikTech International AB, Salesforce Inc., SAP SE, SAS Institute Inc., Teradata Corp., and TIBCO Software Inc. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for the forecast period |
Customization purview |
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