Prescriptive Analytics Global Market Report 2024

The prescriptive analytics market size has grown exponentially in recent years. It will grow from $6.8 billion in 2023 to $8.57 billion in 2024 at a compound annual growth rate (CAGR) of 26%. The growth observed in the historical period can be attributed to several factors, including the increasing volume and complexity of data, advancements in machine learning algorithms, the rise of big data analytics, industry-specific adoption, and an enhanced awareness of the benefits derived from analytics.

The prescriptive analytics market size is expected to see exponential growth in the next few years. It will grow to $21.58 billion in 2028 at a compound annual growth rate (CAGR) of 26%. The anticipated growth in the forecast period can be attributed to several factors, including the adoption of real-time prescriptive analytics, integration with the Internet of Things (IoT), an expansion in cloud-based solutions, advancements in explainable AI, and customization tailored to specific business needs. Notable trends expected in the forecast period encompass cross-industry collaboration, advancements in machine learning algorithms, a focus on real-time prescriptive analytics, cross-industry adoption, and an emphasis on ethical and explainable prescriptive analytics.

The anticipated surge in the adoption of the Internet of Things (IoT) is poised to drive the growth of the prescriptive analytics market in the future. IoT encompasses a network of interconnected devices and the technology facilitating communication between these devices and the cloud. Prescriptive analytics leverages IoT by utilizing real-time data from connected devices and sensors. This data is then analyzed to discern patterns and trends, offering insights into recommended actions. For example, the IoT Analytics State of IoT - Spring 2023 report in May 2023 revealed a global total of 14.3 billion active IoT connections in 2022, marking an 18% increase from 2021. Furthermore, the report forecasts a 16% rise in connected IoT devices, reaching 16.7 billion active endpoints worldwide in 2023. Hence, the growing adoption of IoT serves as a catalyst for the prescriptive analytics market's expansion.

The escalating accessibility to the internet and the widespread use of social networking platforms are expected to propel the prescriptive analytics market's growth in the coming years. The internet functions as a global network linking machines, servers, cell phones, and electronic devices, facilitating communication through established standards. Social networking platforms, on the other hand, are applications and websites fostering user connection, interaction, information exchange, and the establishment of connections based on shared interests or backgrounds. Prescriptive analytics plays a role in analyzing social media data, providing insights into customer behavior and preferences. Notably, a September 2021 report from the University of Maine highlighted a global surge in social media users, reaching 4.48 billion individuals - more than double the 2.07 billion recorded seven years earlier. Additionally, 40% of the global internet user base engages in social media for professional purposes. Consequently, increased internet access and social media use contribute to the driving forces behind the prescriptive analytics market.

The shortage of skilled IT professionals emerges as a significant impediment to the prescriptive analytics market's growth during the forecast period. The scarcity of qualified IT professionals impacts organizations across various industries, influencing their ability to interpret data generated by prescriptive analytics tools. Consequently, additional investments are required for employee training. According to Ernst and Young in May 2023, 81% of organizations express the need for more skilled IT professionals, including those specializing in prescriptive analytics. Thus, the shortage of skilled IT professionals poses a hindrance to the prescriptive analytics market's growth.

Prominent companies in the prescriptive analytics market are actively developing innovative technologies, such as retail prescriptive analytics systems, to foster organizational growth. Retail prescriptive analytics systems utilize data analysis and machine learning algorithms to offer tailored recommendations and actions to retailers. For instance, Kepler Analytics, an Australia-based technology company, launched a retail prescriptive analytics system in January 2023. This system identifies potentially overlooked sales opportunities on a zone-by-zone basis, providing real-time recommendations to enhance sales and profits across a store or group of stores. Leveraging data from unique in-store sensors, the prescriptive analytics system offers a comprehensive feedback loop for store managers, facilitating an understanding of actions taken and their impact on significant sales growth.

In July 2022, IBM Corporation, a US-based technology company, completed the acquisition of Databand.ai Ltd. for an undisclosed amount. This strategic move by IBM aims to broaden its software portfolio, covering data, artificial intelligence, and automation within the spectrum of observability. Databand.ai Ltd., based in Israel, specializes in providing a proactive data observability platform, empowering data engineering teams to ensure the accuracy of data.

Major companies operating in the prescriptive analytics market report are Microsoft Corporation, Koch Industries Inc., The International Business Machines (IBM) Corporation, Oracle Corporation, SAP SE, Salesforce Inc., Infor, SAS Institute Inc., Teradata corporation, Fair, Isaac and Company (FICO), TIBCO Software Inc., Altair Engineering Inc., Talend SA, Happiest Minds Technologies, Mitek Analytics, BOARD International S.A., Pros Inc., Zilliant Inc., Logi Analytics Inc., Sisense Inc., RapidMiner Inc., Improvado, Stitch Data, River Logic Inc., Ayata, Ngdata Inc.

North America was the largest region in the prescriptive analytics market in 2023. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the prescriptive analytics market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa The countries covered in the prescriptive analytics market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The prescriptive analytics market includes revenues earned by entities by providing services such as statistical analysis, customer segmentation, supply chain optimization, financial planning, and forecasting. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included. The prescriptive analytics market consists of sales of optimization software, fraud detection tools, and decision support systems. Values in this market are ‘factory gate’ values, that is, the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors, and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The principal solution for implementing prescriptive analytics is through software and services. Software comprises a set of scripts, instructions, and data designed to execute specific activities. These solutions are deployed through various modes such as cloud and on-premises, catering to organizations of diverse sizes, including large enterprises and small and medium-sized enterprises (SMEs). The range of application types spans risk management, operations management, revenue management, network management, supply chain management, and workforce management. These applications find utility across various industry verticals, including manufacturing, energy and utilities, media and entertainment, transportation and logistics, healthcare and life sciences, retail and consumer goods, banking, financial services, and insurance (BFSI), information technology, telecommunications, and other sectors.

The prescriptive analytics market research report is one of a series of new reports that provides prescriptive analytics market statistics, including the prescriptive analytics industry global market size, regional shares, competitors with prescriptive analytics market share, detailed prescriptive analytics market segments, market trends and opportunities, and any further data you may need to thrive in the prescriptive analytics industry. This prescriptive analytics market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenarios of the industry.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.