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The enterprise application software market is estimated to grow by USD 123.32 billion at a CAGR of 7.7% between 2022 and 2027. The market's expansion hinges on several factors, including the emergence of cloud-based deployment solutions, the escalating imperative to bolster business efficiency, and the mounting demand for ERP software among SMEs. These elements collectively drive market growth, reflecting a shift towards more agile and cost-effective business solutions. The advent of cloud-based deployment signifies a broader trend towards digital transformation and the adoption of flexible, scalable software solutions. Furthermore, the growing emphasis on enhancing business efficiency underscores the need for streamlined operations and optimized resource utilization. The increasing demand for ERP software among SMEs highlights a growing recognition of its benefits in driving productivity and competitiveness. These trends underscore the market's evolution towards more dynamic and responsive business software solutions, driving innovation and growth.
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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This report extensively covers market segmentation by deployment (on-premises and cloud-based), solution (enterprise resource planning, analytics and business intelligence, customer relationship management, supply chain management, and others), and geography (North America, Europe, APAC, South America, and Middle East and Africa).
The market share growth by the on-premises segment will be significant during the forecast period. In comparison to cloud-based solutions, this model is more secure. Large organizations, that care more about functionality and security than costs incurred, largely control this market segment. As these organizations primarily deal with sensitive information, they tend to rely more on the on-premises model because it is safer due to end-to-end quality control and the absence of outside interference.
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The on-premises segment was valued at USD 116.07 billion in 2017. The real-time monitoring of business processes is made possible by on-premises deployments. Since they only require licenses or copies of software solutions bought from independent software companies, such deployments also guarantee the complete security of enterprise data, including source codes, version enhancements, and source code change histories. The high costs associated with moving from an on-premises to a cloud-based model are also causing the growth momentum of the on-premises model. Thus, owing to such factors the segment is expected to grow during the forecast period.
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North America is estimated to contribute 37% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
The two countries that contribute the most revenue to the North American market are the US and Canada. The adoption of enterprise application software in the area is being driven by a rise in the demand for business process transparency and efficiency through digital transformation. In recent times, it is getting difficult for global organizations to maintain separate databases for every department. Issues with data integrity are the result of this. Through the provision of a single, integrated solution that enables data pooling from all the databases that are dispersed throughout all departments, enterprise application tools can assist organizations in overcoming these difficulties. This reduces the duplication of data as well as the time involved in accessing data and helps enterprises generate high-quality reports and enhance business efficiency. These advantages of enterprise application software are driving the growth of the market in this region.
The demand for enterprise application software in the US is rising as various end-user industries, including banking, financial services, insurance (BFSI), and healthcare, have become more digitalized. Healthcare organizations choose cloud-based solutions to handle difficult problems relating to laws like the General Data Protection Regulation or coping with the data explosion brought on by digital transformation initiatives. Additionally, the presence of important companies like Microsoft Corp., Oracle Corp., and Salesforce.com Inc. will have a favorable effect on the local market during the forecast period. For instance, in May 2020, Salesforce.com Inc., a global leader in customer relationship management (CRM), announced Work.com, new technology solutions, and resources to help business and community leaders across the world reopen safely, re-skill employees, and respond efficiently to the challenges thrown up by the COVID-19 pandemic. Such factors will boost regional market growth during the forecast period.
The market encompasses a wide range of software solutions tailored for corporate environments to streamline operations across various departments such as finance, accounting, inventory control, and project management. These applications, whether licensed or open-source, are increasingly adopting cloud-based services to enhance accessibility and scalability. They cater to line-of-business operations, including human resources, sales, and service management, as well as materials and inventory management. The market includes solutions for finance and accounting, supporting IT initiatives and e-commerce systems within corporate networks. With a focus on big data and Software as a Service (SaaS), the market serves the needs of large-scale enterprises through both on-premise deployment and cloud deployment. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The introduction of cloud-based deployment solutions is notably driving market growth. Applications or software that can be accessed remotely and is hosted on the vendor's server on the client's behalf are referred to as cloud-based services. IT resources delivered over the internet are referred to as cloud services. Public clouds, private clouds, and hybrid clouds, which combine public and private clouds, all offer these services. Scalable IT infrastructure and business agility are effectively delivered by cloud-based solutions. This attribute of cloud-based services aids in getting around the difficulties of hardware, license administration, and software.
Furthermore, companies are launching a lot of cloud-based enterprise application software as a result of the rising demand for cloud-based solutions. For instance, in October 2020, Oracle Corp. launched Oracle Banking Virtual Account Management Cloud Service, which allows banks to quickly deploy a wide range of banking services that help their corporate customers access their cash position and manage working capital easily at any time. Therefore, the launch of similar solutions will drive growth in the market during the forecast period.
The increasing adoption of the remote working model is an emerging trend in market growth. With more people working remotely, there is an increasing need for cloud-based software that enables sharing and collaboration as well as guarantees seamless enterprise-wide data transfer, business management, and communication. Additionally, the COVID-19 pandemic compelled businesses to adopt enterprise application software like CRM, ERP, and SCM, which allows them to conduct business operations by connecting and communicating with their clients and employees remotely while also ensuring their safety.
Small and medium-sized businesses and startups have been adopting the work-from-home model, which is anticipated to accelerate the growth of the global market. Moreover, organizations are also considering implementing a hybrid working culture in preparation for the post-pandemic era. As a result, they are spending money on trustworthy enterprise application software and solutions to make sure that business processes are effective and efficient. Hence, such factors are anticipated to propel the growth of the global market during the forecast period.
Data privacy and security concerns are major challenges impeding market growth. As they are more affordable and accessible, cloud-based solutions are preferred by many business organizations over on-premises alternatives. Therefore, the best option for organizations with limited resources and expertise is a cost-effective cloud-based solution with better features and agility. As a result, the cloud has been integrated into government organizations' IT systems. Since the cloud offers better information and communication management with centralized data storage and high-speed networks, federal, state, and local government agencies around the world are migrating their sensitive employee data there. This has the effect of boosting productivity, improving data sharing, and fostering collaboration.
However, as they become dependent on cloud computing service providers, organizations have less control over data. As cloud storage serves as a gateway for security threats and privacy-related problems, many end users are also concerned about the data security policies of cloud-based solutions. Therefore, the risks associated with data privacy and security in enterprise application software are expected to hamper the growth of the market in focus during the forecast period.
The 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 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.
BMC Software Inc. - The company offers products such as BMC Helix Service and Operations Management, TrueSight IT Operations and Automation, Mainframe, and Control-M Workflow Orchestration. The key offerings of the company include enterprise application software such as human resource management systems.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 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 market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD Billion" for the period 2023 to 2027, as well as historical data from 2017 to 2021 for the following segments
The market serves diverse needs within the corporate environment, offering both licensed and open-source applications. It caters to the IT department and cloud segment, focusing on integration and managing business documents. Solutions include web conferencing, BPM, CMS, and EAM for improved operations. They also support customer journey mapping, managing customer contact information, and enhancing customer interactions. From project management to product planning and marketing, these applications streamline back-office activities and synchronize business processes. They offer affordable ERP solutions for small and medium businesses, aiding in data flow and leveraging BI tools and SCM software. With a focus on digitalization, big data analytics, and enterprise mobility solutions, the market caters to large enterprises and small and medium-scale enterprises across various sectors like manufacturing, aerospace and defense, telecom and IT, energy and utilities, and transportation. This market embraces cloud technology and mobile applications, supporting smartphones and mobile devices to meet evolving business needs.
Market Scope |
|
Report Coverage |
Details |
Page number |
173 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 7.7% |
Market growth 2023-2027 |
USD 123.32 billion |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
6.98 |
Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
Performing market contribution |
North America at 37% |
Key countries |
US, Canada, China, UK, and Germany |
Competitive landscape |
Leading companies, Market Positioning of companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Accenture Plc, BMC Software Inc., Broadcom Inc., Capgemini Service SAS, Cognizant Technology Solutions Corp., Epicor Software Corp., Guidewire Software Inc., IFS World Operations AB, International Business Machines Corp., Intuit Inc., Koch Industries Inc., Oracle Corp., QAD Inc., Salesforce.com Inc., SAP SE, SYSPRO Pty. Ltd., TP and P Technology, Virtusa Corp., Zendesk Inc., and Zoho Corp. Pvt. Ltd. |
Market dynamics |
Parent market analysis, Market Forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the market forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Deployment
7 Market Segmentation by Solution
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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