Retail Analytics Market Research, 2032
The global retail analytics market was valued at $7.8 billion in 2022, and is projected to reach $58.4 billion by 2032, growing at a CAGR of 22.6% from 2023 to 2032.
Retail analytics refers to the use of data analysis and computational techniques to gain knowledge of various components of retail operations. It includes collecting, processing, and analyzing data from numerous sources, including sales transactions, customer interactions, inventory records, and marketing campaigns, to inform decision-making and drive business performance. In addition, it empowers retail businesses to gain a better understanding of their business operations, respond to market dynamics, and make more informed decisions to expand growth opportunities and profitability.
The increasing volume and variety of different data have the potential to create several benefits for retail businesses and consumers. Moreover, the surge in digital transformation and the growing trend of e-commerce platforms is likely to expand the adoption of retail analytics solutions and services among organizations. Retailers are using analytic solutions to optimize customer experiences, personalize recommendations, and increase conversion rates in the digital space. In addition, the continuous advancements in technology, such as big data analytics, cloud computing, machine learning, and artificial intelligence, have made retail analytics more accessible to users. Such enhanced factors are expected to provide lucrative opportunities for market growth during the forecast period.
Furthermore, the rise in demand for intelligent analytical solutions is positively impacting the growth of the market. In addition, businesses can connect and analyze data from physical stores, e-commerce platforms, mobile apps, and other channels using retail analytics, to provide a consistent and tailored omnichannel experience. Furthermore, the expansion of retail analytics in several sectors including e-commerce, consumer goods, and supply chain is expected to provide lucrative growth opportunities for the market during the forecast period. Moreover, the increase in deployment of cloud computing technology to allow real-time processing of data and reduce latency to enable scalability, flexibility, and cost-effectiveness is anticipated to create lucrative opportunities for market growth.
Moreover, the growing proliferation of smartphones and the increase in the growth of e-commerce industries in several countries positively impact the growth of the market in the future. In addition, the surge in adoption of cloud-based solutions is expected to boost market growth. However, a lack of technical expertise is expected to hamper market growth. In addition, data privacy concerns can deter the adoption of these technologies in businesses. Furthermore, the increase in integration of data analytics in the retail sector is expected to provide numerous opportunities for the growth of the global market. Moreover, the rise in penetration of digital technologies in businesses is expected to offer remunerative opportunities for the expansion of the global market during the forecast period.
The retail analytics market is segmented into component, deployment mode, organization size and business function.
The retail analytics market is segmented into component, deployment mode, organization size, business function, and region. By component, it is bifurcated into solution and service. By deployment mode, it is divided into on-premise and cloud. By organization size, the market is classified into large enterprises and small and medium-sized enterprises. By business function, the market is segregated into customer management, in-store operation, strategy and planning, supply chain management, marketing and merchandizing, and others Region wise, it is analyzed across North America, Europe, Asia-Pacific, and LAMEA.
On the basis of component, the global retail analytics market share was dominated by the solution segment in 2022 and is expected to maintain its dominance in the upcoming years, owing to the increase in adoption of retail analytics solutions in the e-commerce and supply chain management sector. However, the services segment is expected to witness the highest growth, as the services segment in the retail analytics market provides consulting, implementation, integration, training, and support services to businesses.
By region, North America dominated the market share in 2022. North America is known for its technological advancements and innovation. The region has been at the forefront of adopting and leveraging the latest technologies, including retail analytics, which are anticipated to propel the growth of the market. However, Asia-Pacific is expected to exhibit the highest growth during the forecast period. The region has witnessed a surge in e-commerce adoption, with countries such as China, India, and Southeast Asia experiencing significant growth in online retail is expected to provide lucrative growth opportunities for the market in this region.
COVID-19 Impact Analysis
The retail analytics market witnessed a significant impact after the COVID-19 pandemic, owing to dramatically increased digital devices. The growing online presence of people after the COVID-19-induced lockdowns and social distancing policies fueled the need for retail analytics solutions. In addition, the pandemic caused a significant shift in consumer behavior, with growth in e-commerce and a decline in physical shopping store visits. This was critical for retail businesses during the period as effective retail analytics solutions helped businesses to come up with effective plans to cope with the evolving business landscape post the outbreak of the COVID-19 pandemic. For instance, in May 2021, NielsenIQ launched the Byzzer, it is a platform to provide insights that help small and emerging consumer packaged goods businesses. Similar trends were being noticed all across the globe, which supported the growth of the global retail analytics market during the period. Moreover, the growing adoption of cloud-based retail analytics solutions post the social distancing phase of the pandemic further fueled the dependence on retail analytics and solutions post the period.
Top Impacting Factors
Growing proliferation of smartphones:
The rise in the trend of smartphone devices in several sectors and among individuals is directly influencing the growth of the global retail analytics market. In addition, customers are increasingly using their mobile phones for online shopping, with customers purchasing through mobile applications or mobile-optimized websites. These mobile transactions' generated data offer important insights into consumer behavior, preferences, and purchasing trends. Consequently, retail analytics solutions are gaining significant adoption to increase the use of IT and control systems among retail operators, particularly smartphone usage and other digital technologies. In addition, increased use of smartphones and the internet helps consumers to easily access online shopping platforms, by simply downloading the e-commerce application on their phones. Such ease of access has contributed to increased adoption for the global market, which in turn is expected to enhance the retail analytics market trends, globally.
Furthermore, the integration of smartphones and the internet solution enables an effective user experience for retail analytics services. Retailers are increasingly presenting mobile applications to interact with consumers and offer personalized shopping experiences. Hence, these multiple benefits offered by smartphones and internet use in retail operations are projected to boost the demand for the retail analytics market. Moreover, several public and private organizations are continuously involved in promoting digitalization in analytical operations. For instance, in January 2023, Microsoft partnered with AiFi; in this alliance Microsoft launched Smart Store Analytics, which is a part of Microsoft’s Cloud for the retail product suite. Smart Store Analytics provides retailers with shopper and operational analytics for their fleets of smart stores using AiFi’s technology, which in turn, augments the retail analytics market growth on a global scale.
Growing adoption of cloud-based solutions:
The surge in the expansion of cloud-based analytics solutions in the retail industry is a key driver for the retail analytics market forecast. Cloud computing provides the underlying infrastructure and resources required to deliver analytics solutions to end users, making it an essential enabler for cloud-based retail analytics solutions. This is attributed to the rise in number of countries committing to adopt cloud-based solutions. Further, government policies are undertaking increased initiatives to embrace advanced technology, with plans for integrating a new digital solution. For instance, in April 2023, the Japanese government raised $31.7 million (4.2 billion yen) in funding to develop shared quantum computing using a business-friendly cloud platform. The Japanese government intends to broaden quantum computing's accessibility so that businesses may take advantage of its benefits. Therefore, cloud-based retail analytics gained wider traction among end users, taking advantage of cloud computing solutions in retail industries.
Moreover, cloud-based solutions leverage the economies of scale provided by cloud computing. Organizations can avoid the upfront expenses associated with purchasing and maintaining on-premises hardware infrastructure. Consequently, regional governments and private and public businesses invest in cloud computing solutions. Such advancements in cloud computing eventually contribute toward the growth of the global retail analytics industry.
Key Benefits for Stakeholders
- The study provides an in-depth retail analytics market analysis along with the current trends and future estimations to elucidate the imminent investment pockets.
- Information about key drivers, restraints, and opportunities and their impact analysis on the retail analytics market size is provided in the report.
- The Porter’s five forces analysis illustrates the potency of buyers and suppliers operating in the retail analytics industry.
- The quantitative analysis of the global retail analytics market for the period 2022–2032 is provided to determine the retail analytics market potential.
Retail Analytics Market Report Highlights
Market Size By 2032
USD 58.4 billion
CAGR of 22.6%
2022 - 2032
By Deployment Mode
By Organization Size
By Business Function
Key Market Players
SAP SE, SAS Institute Inc., Teradata Corporation, Oracle Corporation, Amazon Web Services, Inc. , IBM Corporation, HCL Technologies Limited, MicroStrategy Incorporated, Microsoft Corporation, Salesforce.com Inc.
As the retail analytics industry continues to evolve, CXOs are evaluating the opportunities and challenges regarding this emerging technology. The retail analytics industry has grown rapidly in response to the massive amounts of data generated by consumers on offline stores and online shopping platforms, and the need for enhanced analytics and decision-making solutions. CXOs are considering the benefits that retail analytics can offer, such as enhanced customer experience, improved operational efficiency, and cost optimization.
In addition, retail analytics can help organizations to gain a competitive advantage essential in the retail industry. Such factors are expected to provide lucrative opportunities for market growth during the forecast period. Furthermore, by analyzing data on inventory levels, supply chain performance, and workforce management, CXOs can identify areas for improvement, streamline processes, and reduce costs. In addition, retail analytics enables businesses to optimize resource allocation, identify operational bottlenecks, and improve overall business efficiency.
However, CXOs also recognize the challenges associated with retail analytics such as data quality and integration. These primary issues ensure the quality and consistency of data, which can make it complex for organizations to integrate and cleanse the data for analysis. In addition, implementing and effectively utilizing retail analytics requires a skilled workforce with expertise in data analysis, statistical modeling, and data visualization, which can be a barrier to growth of the market. Furthermore, retail analytics frequently demands a strong technological infrastructure, to handle enormous data volumes and complete difficult analytics tasks. CXOs must integrate the solutions and services based on the advanced technological setup, including factors such as scalability, reliability, and security.
By addressing these challenges, CXOs can unlock the full potential of retail analytics to transform their retail operations, create value, and gain a competitive advantage in their industry. For instance, in March 2022, Snowflake launched a data cloud for the retail industry, the platform is further dedicated to addressing the challenges faced by the retail industry.
The new retail data cloud solves this challenge by combining together industry-specific data sets and several partner solutions on a single platform.