Procurement Data Intelligence Market Size Projection (2024 – 2030)

By the end of 2023, the Procurement Data Intelligence Market attained a value of $3.26 billion and is anticipated to witness a substantial growth, reaching a market size of $15.81 billion by 2030. Over the forecast period spanning from 2024 to 2030, the market is poised to exhibit a Compound Annual Growth Rate (CAGR) of 25.3%. Various factors are expected to propel the utilization of procurement data intelligence technologies and services, including escalated expenditures on marketing and advertising among businesses, evolving consumer intelligence dynamics driving the market, and the broadening of customer channels.

Procurement Data Intelligence Market Overview

Procurement data intelligence involves the application of quantitative methodologies to extract actionable insights and outcomes from data, facilitating data-informed decision-making processes. It encompasses the collection and analysis of data to enable evidence-based decision-making, typically reflecting past occurrences and employing predictive analytics to anticipate future trends based on historical data. Core operational activities such as procurement of goods and services, vendor selection, sourcing, contract negotiations, and strategic assessment generate substantial volumes of data within organizations. Leveraging analytics on this data entails employing diverse quantitative methodologies to derive actionable insights and outcomes, thereby aiding strategic decision-making and fostering competitive advantages for firms. Procurement analytics solutions predominantly utilize predictive analytics on historical datasets to forecast future trends, empowering management personnel in critical procurement decision-making processes.

The procurement domain is undergoing transformative insights through robust data analytics, applicable in negotiations, vendor segmentation, performance monitoring, and annual procurement planning. The procurement function harbors extensive data reservoirs encompassing transaction histories, expenditure records, and various other pertinent information. By harnessing intelligent analytics, the utilization of procurement data can significantly enhance the quality of business decisions.

Impact of COVID-19 on the Procurement Data Intelligence Market

The unprecedented magnitude of the global health crisis has reverberated across diverse industries, including hospitality, healthcare, consumer electronics, banking and finance, and technology. This crisis has compelled enterprises to confront not only novel challenges but also necessitated adaptations in their business strategies. However, amidst the prevailing challenges, the procurement industry is witnessing expansion, given its potential to aid businesses in mitigating the economic ramifications of the pandemic and enabling other enterprises to sustain and expand their operations, thereby fostering the adoption of procurement analytics. Additionally, enterprises have intensified their focus on engaging with their supplier networks, internal stakeholders, and external collaborators. Consequently, enterprises are mandated to augment their focus on procurement activities. This heightened emphasis on procurement operations is anticipated to drive enterprises towards fortifying their procurement strategies, thus engendering favorable prospects for the procurement data intelligence market.

Market Drivers

Augmented emphasis on enhancing operational efficiencies across procurement channels propels market growth.

The burgeoning demand for predictive analytics stems from the imperative to foresee losses and risks, augment productivity, curtail operational expenditures, and foster consistent business expansion. Procurement analytics furnishes data-driven insights that aid enterprises in curtailing overall procurement expenses while enhancing service levels. The pervasive adoption of analytics tools has engendered enhancements across procurement processes encompassing planning, design, production, delivery, and service, thereby impelling demand for procurement analytics solutions. Equipped with functionalities such as plan compliance analytics, spend analysis, inventory optimization, vendor management, contract management, route and network optimization strategies, and price optimization, these solutions empower enterprises to make informed decisions.

Integration of machine learning and artificial intelligence (AI) accelerates industry growth within the procurement domain.

The advent of machine learning and artificial intelligence has bolstered enterprises' capacity to amass, analyze, and leverage information, thereby facilitating informed decision-making processes. These transformative technologies are permeating procurement platforms and technologies, bolstering enterprises' capabilities and offerings. AI technologies are instrumental in expediting procurement decision-making processes, wherein AI systems evaluate and recommend alterations to Governance, Risk Management, and Compliance (GRC) frameworks, thus aiding in data monitoring and ensuring compliance with regulatory standards. The proliferation of machine learning and AI has enabled providers to glean deeper insights into consumer perceptions and organizational spending patterns by analyzing data sourced from diverse channels. By discerning consumers' purchasing behaviors, enterprises are redirecting their focus towards delivering seamless customer experiences across channels and proffering real-time incentives. AI technologies facilitate enterprises and suppliers in identifying supply chain disruptions, detecting fraudulent activities, and identifying and flagging supplier compliance issues, thereby enabling smarter procurement practices.

Market Restraints

Enterprises' apprehensions regarding data security impede market expansion.

Enterprises leveraging procurement analytics tools confront apprehensions regarding data security and privacy. These tools house sensitive information necessitating robust safeguards to prevent data breaches and unauthorized access, which could compromise an organization's reputation and revenue streams. The access that analytical providers possess to such confidential data raises concerns among enterprises regarding the potential leakage of data over digital channels, thereby risking unauthorized access by malicious entities. For instance, the adoption of a multi-tenant architecture within the Transportation Management System (TMS) necessitates stringent security measures to prevent data exposure to unauthorized users, potentially compromising enterprises' data security and competitive standing. Consequently, apprehensions surrounding data security and privacy are mounting among enterprises, potentially constraining the growth trajectory of the procurement data intelligence market throughout the forecast period.

Market expansion is hindered by a dearth of analytical expertise.

Since the integration of analytical capabilities into organizational procurement platforms, enterprises have leveraged procurement analytics solutions to optimize their procurement portfolios. Typically, employees are tasked with harnessing these platforms to glean insights from data repositories. Effectively harnessing burgeoning volumes of big data across industrial verticals necessitates meticulous modeling, integration, wrangling, and subsequent analysis. Data scientists must possess specialized skills to discern and unearth trends pivotal for enabling informed decision-making processes, spanning from data ingestion to reporting. However, a prominent challenge faced by diverse enterprises pertains to a dearth of proficiency in discerning the relevance of procurement analytics.

Procurement Data Intelligence Market by Component

• Solutions
• Services

The global market is segmented into solutions and services based on their components. Enterprises utilize solutions from various market players such as Board International's Board 11, SAP Analytics Cloud & SAP BusinessObjects Lumira, Yellowfin B1, Tableau (Server, Desktop, Online, Prep), and QlikSerise & QlikView, among others, to extract actionable insights from both real-time and historical business performance tracking. Furthermore, the integration of AI-driven analytics solutions with business intelligence platforms is anticipated to drive demand for enhanced visualization. Similarly, Bi Augmented Analytics based on augmented reality is expected to bring transformational impact in the long term.

Procurement Data Intelligence Market by Deployment

• Cloud
• On-premise

The market is categorized into cloud and on-premise deployments. In 2020, on-premise deployment held the largest market share, but cloud deployment is projected to witness the fastest growth rate during the forecast period. Enterprises with on-premise deployments can leverage cloud adoption benefits. These applications are designed to enhance storage, networking, and tools utilization while providing analytical capabilities. Cloud deployments enable companies to manage their applications without the burden of maintaining the infrastructure. This aspect aids organizations in boosting productivity, reducing operational costs, and optimizing implementation timelines, hence contributing to the anticipated rapid growth of cloud deployment.

Procurement Data Intelligence Market by Enterprise

• Large Enterprises
• Small and Medium-Sized Enterprises (SMEs)

The market is segmented into small and mid-size businesses and major enterprises based on their size. Large enterprises are expected to dominate the market due to substantial investments and the availability of IT infrastructure, among other factors.

However, SMEs are projected to experience rapid growth due to increased software deployment for smoother operations. They play a crucial role in enhancing client satisfaction through commercials and targeted marketing activities. Additionally, factors like resource optimization and continuous productivity evaluation drive the demand for innovative tools among SMEs.

Procurement Data Intelligence Market by Vertical

• BFSI
• Retail and eCommerce
• Telecom and IT
• Manufacturing
• Healthcare and Life Sciences
• Energy and Utilities
• Government and Defense

The telecom and IT industry is highly competitive, with companies constantly striving to enhance services to attract and retain customers. The complexity of the telecom sector and the increasing number of service providers have led to a growing demand for procurement analytics solutions. The proliferation of smartphones and other connected devices has resulted in a surge of data traffic over telecom networks, necessitating data processing, storage, and extraction of insights by operators. Procurement analytics can assist in optimizing profitability by reducing network consumption, improving customer experience, and enhancing scalability.

Procurement Data Intelligence Market by Application

• Supply Chain Analytics
• Risk Analytics
• Spend Analytics
• Demand Forecasting
• Contract Management
• Vendor Management
• Category Management

During the forecast period, the Supply Chain Analytics segment is expected to hold a significant market share. Supply chain analytics refers to the use of various analytical technologies to enhance operational efficiency and effectiveness through data-driven insights in supply chain management. Industries such as manufacturing, retail, consumer products, energy, utilities, and healthcare are poised to leverage supply chain analytics tools for informed decision-making in procurement, supplier performance evaluation, inventory management, demand forecasting, and supply chain optimization. Industry players offer solutions such as supplier performance analytics, spend and procurement analytics, inventory analytics, demand analysis and forecasting, and transportation and logistics analytics.

Procurement Data Intelligence Market by Region

• North America
• Europe
• Asia-Pacific
• Latin America
• Middle East and Africa

The procurement data intelligence industry is comprised of five primary regions: North America, Europe, APAC, Latin America, and MEA. APAC is expected to witness significant growth during the forecast period, driven by the establishment of numerous new entrepreneurial ventures aiming to gain market share and customer trust through the implementation of advanced analytics paradigms for a competitive edge. China, Japan, and India exhibit substantial growth potential within the procurement data intelligence industry.

However, North America is projected to lead the market in terms of revenue during the forecast period. The region's rapid adoption of innovative technologies, coupled with the presence of major players like Microsoft Corporation, Oracle Corporation, Tableau Software, LLC, among others, is anticipated to fuel regional growth.

The UK government's commitment to developing robust infrastructure to support big data analytics is evident through its significant investments. The government has allocated approximately USD 222.6 million in capital funding for energy-efficient computing and data centers, demonstrating strong governmental support and substantial investments that are poised to drive market expansion. Organizations like the British Healthcare Business Intelligence Association actively promote healthcare knowledge in the UK.

Procurement Data Intelligence Market by Company

To expand their market presence, procurement data intelligence providers have employed various growth strategies, including new product launches, product enhancements, partnerships, corporate expansions, mergers, and acquisitions.

1. SAP (Germany)
2. SAS Institute (US)
3. Coupa Software (US)
4. Genpact (US)
5. Microsoft (US)
6. IBM (US)
7. Cisco (US)
8. GEP (US)
9. Corcentric (US)
10. Zycus

Recent Developments in the Procurement Data Intelligence Market:

PRODUCT LAUNCHES

• In May 2021, IBM introduced Watson AIOps, an AI-based tool designed to automate real-time detection, diagnosis, and response to IT anomalies across hybrid cloud environments.
• In July 2020, GEP unveiled its next-generation accounts payable (AP) automation platform, addressing market demand for a cloud-native solution leveraging AI and ML to optimize and accelerate AP operations.
• In June 2020, SAP deployed the Corona Warn App for the German government in collaboration with Deutsche Telekom and other partners. The app, developed in an open-source manner, aimed to mitigate the spread of COVID-19 and featured its source code publicly available on GitHub.