This post looks at the digital transformation market size: 2020, 2021, and beyond.
It also covers key technologies and trends that are driving this market forward.
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Digital Transformation Market Size 2020: Key Trends and Stats
First, it is important to note that the digital transformation market is defined differently by different analysts.
Unlike other markets, such as the market for a specific SaaS platform, the meaning of digital transformation is more open to interpretation.
As a result, most estimates around the digital transformation market size vary widely from report to report.
Here are a few examples:
- The global digital transformation market size had a value of $284.38 billion in 2019 and will grow at a compound annual growth rate of 22.5% between 2020 and 2027 (Grand View Research)
- In 2018, the global digital transformation market size was valued at $320 billion, and it will grow by 18.1% annually, reaching a projected $695 billion in 2025 (Market Data Forecast)
- The global digital transformation market size will increase by 12.4% annually between 2020 and 2025, from $340.2 million in 2019 to $543.7 million in 2025 (Markets and Research)
- Between 2020 and 2025, the global digital transformation market size will increase at a compound annual growth rate of 16.5%, rising from $469.8 billion to $1009.8 billion (Markets and Markets)
- The digital transformation market will grow at a compound annual growth rate of 18% between 2020 and 2025, from $342.2 billion to $923.8 billion (Mordor Intelligence)
- In 2017, the digital transformation market was valued at $0.96 trillion and it will increase to $2.3 trillion in 2023 (Statista)
Despite the disparity in these statistics, they do offer a few important takeaways.
All of the reports cited above, for instance, project a healthy upward trend over the next several years. The conclusion we can draw is that, regardless of differences in methodologies, analysts agree that the digital transformation market will continue to grow steadily for years to come.
Also, while the analyses are clearly based on different research methods and pictures of the market, many of them cover the same territory and the same technologies, which we will look at below.
Top Market Drivers and Technologies
Digital transformation means leveraging digital technology to drive organizational transformation and change.
Since digital transformation is fueled by disruptive innovation, it should come as no surprise that many analysts focus on emerging technology in their research.
Here are a few examples of those technologies and trends:
- Internet of Things (IoT). IoT refers to the integration of the internet with the physical world, primarily through the use of sensors. These sensors can be placed in everyday items such as household appliances, wearables, and even clothing.
- Artificial intelligence (AI). AI is an umbrella term that typically refers to machine learning and deep learning. These are computing paradigms that enable machines to “learn” from data sets and recognize patterns. Today, AI is often used for tasks such as image recognition, voice recognition, and semantic analysis.
- Cloud computing. Cloud computing uses remote servers to perform computing tasks, rather than local machines, such as desktop computers. Among other things, cloud computing is essential for companies that want their workers to operate remotely.
- Automation. Digital automation tools use software to perform digital tasks normally done by people. Robotic process automation (RPA) tools, for instance, can be used to automate digital workflows, freeing up employees’ time for more valuable activities. Digital adoption platforms (DAPs) can also be used to automate certain tasks.
- Augmented reality (AR) and virtual reality (VR). VR headsets immerse users in an artificial, digital space. AR, on the other hand, only augments the user’s senses by injecting sights and sounds into the world around them. These technologies have yet to achieve widespread adoption, but they are receiving more investments every year and hold a great deal of promise.
- 5G. As the world becomes more digital, we will require more bandwidth and more speed. 5G networks offer that capability – they are faster and can handle more connections than 4G and they will become the backbone of the internet in the years ahead.
- Digital adoption. Digital adoption solutions are crucial for innovative, digital-first businesses. These platforms automate and streamline software training, which improves the employee experience, raises productivity, and boosts software ROI. In the coming years, this market is expected to grow at almost the same pace as the digital transformation market.
Each of these trends will impact different sectors in different ways. When reviewing the reports, therefore, it is important to find those reports that have the greatest relevance to one’s own industry.
As we saw, there are clearly a number of ways to view the digital transformation market.
Some analyses embrace a very wide view of digital transformation, while others focused more narrowly on certain technologies or companies.
When reviewing digital transformation statistics and analyses, it is important to understand the scope of the report. That scope, after all, will determine how relevant and valuable the analysis is.
However, the general trends remained consistent, despite the variety in research methodologies – namely, that digital transformation will continue to grow at a rapid pace for years to come.