Global Digital Commerce Software Market - Segmented by Component (Software, Services), Deployment Model (On-Premise, Cloud-Based, Hybrid), Industry (Retail, Financial Services, Communications), and Region - Growth, Trends, and Forecast (2018 - 2023)
The digital commerce software market was valued at USD 4219.7 million in 2017 and is expected to reach a market value of USD 4219.7 million by 2023, registering a CAGR of 12.59% during the forecast period (2018 - 2023). Digital commerce software continues to be one of the fastest growing verticals in the overall enterprise applications software market. The scope of the report is segmented by component and deployment type.
Organizations, B2B, B2C, or B2B2C caterers, have realized the need for seamless omnichannel commerce experience and the benefits it provides by building a customer relationship. The perks of adopting cloud-based services and the evolving wire-line as well as wireless communications networks enabling customers to stay connected, is driving the business to stay connected and get close to their customers in order to create a relationship and enhance loyalty. The major challenges faced by the business with digital commerce software is the integration of the software with the existing legacy systems, such as SAP and other CRM systems, especially with the additional adhoc software that have been added over the years in order to facilitate the current needs of the organizations.
Adoption of Cloud-based Services Expected to Drive the Market
According to NASDAQ, the revenues for cloud services grew by 60% in 2015. Furthermore, cloud computing is estimated to grow at a robust rate over the course of the next five years. The increased adoption of cloud-based software has provided a number of benefits for companies from various industries, including the ability to use software from any device, either through a native app or through a browser. It is estimated that more than USD 70 billion in SaaS revenue was be generated in 2015 and is estimated to increase to USD 130 billion in 2020with a projected CAGR of 13.18%. The overall spending on cloud computing infrastructure and platforms is estimated to grow at a CAGR of 26% from 2015 - 2018, compared with 5% growth for the complete enterprise IT. By 2016, there was an estimated 11% shift in the IT budget away from traditional on-premise IT delivery toward various versions of cloud computing as a new delivery model. By 2020, more than 65% of the enterprises will have at least half of their infrastructure on cloud-based platforms. .
On-Premise Deployment Model Expected to hold Significant Market Share
Over the years, on-premise deployment model was highly used in the industry. The software are generally installed and run on computers in the premises of the organizations rather than in a remote facility, such as on server or cloud, on the internet. Today, most of the SMBs are often faced with the dilemma to either go for a hosted or an on-premise model. Generally, the choice is based on their business needs and the infrastructure available. The on-premise model has more control over the entire system/data with the corporate data stored or handled internally. However, it requires a dedicated support of IT staff and high initial investments.
Increasing issues related to security and compliance associated with other models, full control over data and processes, easy-to-deploy with excellent scalability, simple setup, and scale up storage as required by adding storage volumes, are some of the factors accelerating the growth of the market.
North America Expected to Hold Highest Market Share
Cloud solutions are playing a crucial role in propelling the growth of digital commerce in this region due to their attributes that include cost-effectiveness, automatic integrations, minimum IT investment, and easy accessibility. Enterprises in this region are looking to replace custom-developed, raging applications with more modern applications that allow them to swiftly move into new markets with omnichannel solutions and pop-up stores. Retailers are striving to improve the purchasing experience of the customers and are at the forefront of digital commerce in the US, thereby, driving the market for digital commerce software.
Key Developments in the Market: