Data Analytics Outsourcing Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)

The Data Analytics Outsourcing Market is segmented by Type (CRM Analytics, Supply Chain Analytics, Risk Analytics, Financial Analytics), End-user Industry (Automotive, Manufacturing, Retail, BFSI, IT and Telecom, Oil & Gas), and Geography.

Market Snapshot

Data Analytics Outsourcing Market Bar Graph
Study Period: 2018 -2026
Base Year: 2020
Fastest Growing Market: Asia Pacific
Largest Market: North America
CAGR: 21.5 %
Data Analytics Outsourcing Market Major Players

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Market Overview

The data analytics outsourcing market was valued at USD 3.04 billion in 2020, and it is expected to reach USD 9.46 billion by 2026 at a CAGR of 21.5% during the forecast period from 2021 to 2026. Artificial Intelligence (AI)/Machine Learning technology has replaced humans in many aspects of data analytics, thus, requiring less input from human manual work. The nature of data analytics outsourcing, therefore, skews toward how humans can effectively create and train a machine learning model rather than how businesses could manage an offshore team.

  • Over 90% of the world's data was created in the last two years, as per IBM. And the shortage of the right talent has led to the growth of analytics solutions, as the acceptance is stemming from several industries BFSI, retail, to name a few. The FMCG manufacturers, for instance, are observed suffering from unstable sales performance lacking the capability to diagnostic analytics, to identify what triggers poor performance or make accurate sales forecasts. At such a moment, the manufacturer has required time and budget to grow an in-house data analytics team. Therefore, they turn to analytics outsourcing in the hope of fast insight.
  • Many businesses were in the process of outsourcing their data operations even before the COVID-19 pandemic, and the current situation even more speed up this process. Firms are also shifting a large percentage of their IT spending dollars into cybersecurity projects. According to DataScience blog, a recent survey found that 37% of business leaders said they were already going to cut their IT department budgets. The same study found that 28% of businesses are going to move at least some part of their data analytics programs abroad.
  • The generation of huge amounts of data has led the companies to seek insights, such as customers' segmentation, understanding of the preferences under each segment, staying updated with changes in behavior, and personalization of services. Additionally, due to the rise in the usage of the internet, there is an enormous amount of structured and unstructured data available to organizations. Such benefits have led multinational and large companies to get their Big Data analyzed for actionable insights.
  • Cloud migration has also boosted adoption as inherent cloud characteristics, such as scalability, agility, cost-effective storage options, and access to vast processing power, complement the ability to harvest Big Data. Besides, cloud computing technology has become mainstream, and the seamless connectivity provided by the cloud is making it accessible and leading to the generation of Big Data and applications. According to the Right Scale's annual State of the Cloud Report 2021, 19% of businesses use public cloud, 2% use private cloud, and 78% use hybrid cloud. Hence, the advent of cloud technology is also boosting the growth of the market studied.

Scope of the Report

Data analytics outsourcing is a model under which a data-driven company assigns a service provider with its data and gets access to insightful reporting. The provider overlooks infrastructure setup and support, data management, and data analysis. Since the organizations find it time-consuming to manage data generated, the need to attain quick insights fuel the demand for data analytics outsourcing.

Type
CRM Analytics
Supply Chain Analytics
Risk Analytics
Financial Analytics
Other Types
End-user Industry
Retail
Automotive
Manufacturing
BFSI
IT and Telecom
Oil & Gas
Other End-user Industries
Geography
North America
Europe
Asia Pacific
South America
Middle East and Africa

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Key Market Trends

BFSI is Expected to Hold Major Share

  • Data analytics has many purposes in the banking industry, ranging from improving cybersecurity to reducing customer churn. Banks can even harness external regulatory, trading, and social media engagement data, all of which can be processed and analyzed to benefit their operations. For example, Santa Rosa, California-based Redwood Credit Union, found that social data was particularly important when offering auto loans. It initially extended preapproval for such loans every two years based solely on members' credit scores and vehicle purchase histories. It soon discovered that there was a much more reliable indicator and updated its preapproval frequency accordingly.
  • Big Data significantly affects banks' back-of-house operations as well as their customer-facing processes. It is key to risk management functions, which entail assessing the likelihood that any given transaction could be fraudulent or present a credit risk. Data analytics systems can analyze thousands of variables for each transaction, including applicants' lending histories, past transactions associated with their credit cards, or individual items in their credit histories. This gives bank staff educated predictions regarding interactions' risk factors. Bank of America's Corporate Investment Group (CIG) used a data analytics system to calculate the default probability of approximately 9.5 million mortgages, reducing the calculation time from 96 hours to just 4 hours.
  • In January 2020, The Financial Conduct Authority (FCA) and the Bank of England (Bank) outlined their plans to develop their data and analytics capabilities. Both authorities depend on access to high-quality data to fulfill their respective missions of maintaining monetary and financial stability, market integrity, effective competition, and consumer protection. FCA's refreshed Data Strategy sets out a transformation plan to become a highly data-driven regulator. The strategy outlines the organization's increased focus on the use of advanced analytics and automation techniques to deepen its understanding of how markets function and allow the FCA to efficiently predict, monitor and respond to firm and demand issues.
  • During the 2020 ABA Conference for Community Bankers, KlariVis, a unique and proprietary data analytics software platform developed by bankers for bankers, announced that it had been selected by three community banks: Select Bank & Trust; the Bank of Botetourt, and the Farmers Bank of Appomattox. KlariVis helps community financial institutions to make more strategic and better-informed decisions by uncovering and providing access to their transformative data. KlariVis compiles and aggregates actionable data in an automated fashion providing banks like Select Bank & Trust improved and timely insight into factors such as deposit, loan, and revenue growth. Community banks can make data-driven decisions across their entire organization, gaining a significant competitive advantage in today's market.
Data Analytics Outsourcing Market Share

Asia Pacific Region is Expected to Witness Fastest Growth

  • With Big Data analytics used in finding existing insights and creating connections between data points and sets and cleaning the data, the rapid adoption of outsourcing of data analytics is making projections about future activity, trends, and customer behaviors. According to the China Academy of Information and Communications Technology (CAICT), the Big Data Market size in China is expected to reach CNY 57.8 billion by 2020 from CNY 32.7 billion in 2018. Being augmented by AI/ML with analytical models, major IT firms, and analytics firms in the region are building an ML practice and developing vertical-specific AI solutions.
  • The data from increasing social penetration contains hidden patterns that traditional analytics tools are unable to find, and require increased adoption of analytics. According to We Are Social, as of January 2021, the active social network penetration in China and the United States accounted for 64.6% and 72.3%, respectively, indicating again the presence of the massive amount of data generation requiring analytics. ​This is acting as a catalyst for businesses in the country to opt for data analytics outsourcing.
  • India has been leading revenue generation in the analytics market, with TCS generating USD 2 billion from analytics services. Additionally, companies, like India Inc. led by TCS, Genpact, Wipro, are investing heavily in such domain, thereby increasing the range of services being offered, as per 2019 study Analytics India Magazine and Praxis Business School. Also, almost 47% of analytics revenues in India have risen from exports to the United States, while the United Kingdom, in the second position, is recording 9.6% of revenues of overall USD 27 billion generations from outsourcing.
  • In China, high-tech and big data analysis have been widely used to support government policy decisions, continuing in the fight against COVID-19. Based on the data platform, advanced data analytics created a path map for people flow, especially for those who came from and passed through Hubei Province or other outbreak areas. These maps tracked the flow of people who had tested positive for the coronavirus in the past 14 days, to find out who these people had come into close contact with. These results helped the local government and communities to implement defensive measures.
Data Analytics Outsourcing Market Growth

Competitive Landscape

The Data Analytics Outsourcing Market is fragmented, with various vendors proving business process solutions for big companies and SMEs. As the amount of big data generated by enterprises increases, more vendors are being contacted to manage enterprise data and provide data intelligence services. Technological advancements in the market are also bringing sustainable competitive advantage to the companies, and the market is also witnessing multiple partnerships and mergers.

  • January 2021 - Genpact has acquired Enquero, a firm that offers data engineering and data-led digital transformation services. Enquero will increase the scale and depth of Genpact's data and analytics teams and further enhances its capabilities to accelerate the digital transformation journeys of its clients,
  • June 2020 - Accenture entered into an agreement to acquire Sentelis, an independent data consulting and engineering company, headquartered in France, that specializes in designing and scaling data and artificial intelligence (AI) capabilities. Sentelis would join Accenture Applied Intelligence and complement its focus on helping clients build the right data strategy and foundation to industrialize AI across their businesses.
  • February 2020 - Capgemini announced the signing of an agreement to acquire Advectas, one of the leading business intelligence and data science company in Scandinavia. By joining Capgemini’s Insights & Data global business line, the 200+ strong Advectas team will help to meet further growing client demand for Capgemini’s business intelligence and data analytics services across the region.
  • Feburary 2020 - SEBI shortlisted IBM India and other data service provider companies to implement a "data analytics project" through which the regulator wants to track possible market manipulations, such as insider trading and front running. The move is part of SEBI's efforts to address and handle challenges arising out of technological advancements in the markets.

Recent Developments

  • February 2021 – Massmart a leading retailer in Africa partnered with Gempact, to leverage its digital technology and analytics to drive competitive growth. Genpact will transform and manage Massmart’s finance and accounting (F&A) services, including accounts payable, accounts receivable, and defined activities in financial control, tax, treasury, and financial planning and analysis. 
  • October 2020 - Gramener has achieved the Gold Partner status with Microsoft. With the Microsoft Gold status in Data Analytics, Gramener enters the league of dedicated analytics solution providers who develop and deploy data science solutions on the top of Microsoft’s analytical stack and Azure. Gramener has earned the Gold Partner status after completing rigorous technical requirements. It also comes on the back of successful engagements with Microsoft to build and deploy data-driven and AI-enabled solutions.



Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Assumptions and Market Definition

    2. 1.2 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET DYNAMICS

    1. 4.1 Market Overview

    2. 4.2 Impact of COVID-19 on the market

    3. 4.3 Industry Attractiveness - Porter's Five Forces Analysis

      1. 4.3.1 Bargaining Power of Suppliers

      2. 4.3.2 Bargaining Power of Consumers

      3. 4.3.3 Threat of New Entrants

      4. 4.3.4 Intensity of Competitive Rivalry

      5. 4.3.5 Threat of Substitute Products

    4. 4.4 Industry Value Chain Analysis

    5. 4.5 Market Drivers

      1. 4.5.1 Increasing Volume and Variety of Data being Generated are the Major Driving Factors for this Industry

    6. 4.6 Market Challenges

      1. 4.6.1 Lack of Skilled Professionals

  5. 5. MARKET SEGMENTATION

    1. 5.1 Type

      1. 5.1.1 CRM Analytics

      2. 5.1.2 Supply Chain Analytics

      3. 5.1.3 Risk Analytics

      4. 5.1.4 Financial Analytics

      5. 5.1.5 Other Types

    2. 5.2 End-user Industry

      1. 5.2.1 Retail

      2. 5.2.2 Automotive

      3. 5.2.3 Manufacturing

      4. 5.2.4 BFSI

      5. 5.2.5 IT and Telecom

      6. 5.2.6 Oil & Gas

      7. 5.2.7 Other End-user Industries

    3. 5.3 Geography

      1. 5.3.1 North America

      2. 5.3.2 Europe

      3. 5.3.3 Asia Pacific

      4. 5.3.4 South America

      5. 5.3.5 Middle East and Africa

  6. 6. COMPETITIVE Intelligence

    1. 6.1 Company Profiles

      1. 6.1.1 Accenture PLC

      2. 6.1.2 Capgemini SE

      3. 6.1.3 Cognizant Technology Solutions Corp.

      4. 6.1.4 Genpact Ltd

      5. 6.1.5 Gramener

      6. 6.1.6 IBM Corporation

      7. 6.1.7 Infosys Ltd

      8. 6.1.8 Mu Sigma Inc.

      9. 6.1.9 Opera Solutions LLC

      10. 6.1.10 Tata Consultancy Services Ltd

      11. 6.1.11 Wipro Ltd

      12. 6.1.12 WNS Global Services Private Limited

      13. 6.1.13 ZS Associates Inc.

    2. *List Not Exhaustive
    3. 6.2 Vendor Ranking Analysis

  7. 7. INVESTMENT ANALYSIS AND FUTURE OUTLOOK

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Frequently Asked Questions

The Data Analytics Outsourcing Market market is studied from 2018 - 2026.

The Data Analytics Outsourcing Market is growing at a CAGR of 21.5% over the next 5 years.

Asia Pacific is growing at the highest CAGR over 2021- 2026.

North America holds highest share in 2020.

Accenture PLC, Capgemini SE, Cognizant Technology Solutions Corp., Genpact Ltd, IBM Corporation are the major companies operating in Data Analytics Outsourcing Market.

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