ReportLinker's latest report on the digital transformation market has revealed that the industry will grow to $665bn by 2023, up from $290bn in 2018, at a CAGR of 18.1% from 2018–23.
The growth of the market will be driven by the increasing number of mobile devices and apps, as well as the growing penetration of IoT and adoption of cloud services, with businesses looking to digitalize their organizational functions to serve changing customer preferences and improve operational efficiency.
Growth in the market will be led by the implementation of AI technology, which has been transforming the way businesses and organization collect and analyze data. The report, however, noted that security and privacy concerns for confidential data would likely hinder the global market's growth.
"AI builds data models automatically in digital forms," said ReportLinker in the report. "AI also collects data from multiple sources and uses the information as a knowledge store, which can help businesses in several ways, such as identifying and analyzing buying patterns and trends or predicting the needs of consumers to boost customer experience."
In respect to deployment, the cloud segment will lead the digital transformation market, with cloud enabling users to access solutions from their desktops and mobile devices. Businesses have been turning to the cloud due to the ease in which cloud solutions can be deployed at low cost, reducing their IT budgets and financial risks.
Retail, among the fastest-growing verticals in respect to the adoption of emerging technologies such as cloud computing, big data analytics, DevOps and digital stores, has been at the forefront of digital transformation. In its report, ReportLinker said that increasing adoption among retail players was due to the "rising purchasing power of customers and the need to satisfy customer expectations".
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The report, which looked at a range of regional markets, found that the digital transformation market in the APAC region was projected to grow at the highest CAGR during the forecast period.
"This growth is primarily driven by the high rate of adoption of digital technologies, especially in economies such as Australia, India, China, Japan and Singapore," the report noted.