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The global low-code development platform market was valued at $5.6 billion in 2018, and is expected to reach $52.3 billion by 2024, progressing at a CAGR of 45.2% during the forecast period. Rising internet penetration, proliferation of smartphones, and growing need for web and mobile apps for business processes are some of the key factors that drive the market across the globe. Furthermore, APAC is projected to record the fastest growth during the forecast period. The growth can be attributed to accelerated IT investments in developing countries, primarily in China and India. For instance, in 2015, the Government of India launched “Digital India” program with the vision to transform India into a digitally empowered society.
Factors Governing Low-Code Development Platform Market
Digital transformation has disrupted various industries, including BFSI, manufacturing, automotive, and oil & gas, where companies are forced to adopt digital technologies in order to stay relevant in their markets. According to the World Economic Forum, industries primarily led by BFSI, manufacturing, and retail, across the globe, are expected to allocate around $1.2 trillion for digital transformation in 2019, a year-on-year (Y-o-Y) increase of 18%. The spending further projected to reach $2.4 trillion by 2022. With increase in demand for business applications across industries, the platform is expected to play a pivotal role in enabling quick digitization of business processes, such as sales, accounting and finance, and operations.
Digitization of various business processes, such as operations, HR, and sales, offer enormous opportunities for value creation. According to the World Economic Forum, over the next ten years, digital transformation of industries could create a value of around $100 trillion, reflecting plethora of growth opportunities offered by digital transformation. With low-code development platform, organizations could develop web and mobile apps rapidly, thereby ensuring digitization of business processes. AI is becoming a major part of digital transformation as it offers ability to predict trends, enabling organizations to use this predictive analysis to make informed decisions. Low-code solution with AI capabilities could make development of AI-based applications for various business processes with a simple, intuitive, and accessible task. This could create huge opportunities for players in the low-code development platform market.
Low-Code Development Platform Market Segmentation Analysis
Based on offering, solution category held larger market share in 2018, attributed to the increasing adoption of low-code development platform across all verticals in order to reduce IT expenditure for long term. Furthermore, due to growing demand for integration and implementation, the service category is expected to exhibit faster growth during the forecast period. This could be attributed to the increasing demand for technical expertise and timely upgradation of the platform.
On the basis of deployment type, cloud-based deployment type held larger share in the market in 2018, and is also expected to witness faster growth during the forecast period. This is due to the majority of market players offering low-code development platform over the cloud. In addition, cloud-based deployment offers increased scalability, 24/7 service, high speed, and enhanced management capabilities for application development. Thus, the demand for cloud-based deployment is projected to increase as compared to on-premises deployment during the forecast period.
On the basis of enterprise size, the large enterprise category held larger share in the market in 2018. This is due to the fact that the large enterprise has significantly higher budget to adopt low-code development platform to develop a large number of new applications for its operations within less time. For instance, companies such as Genpact Limited and Yahoo Inc., have already adopted low-code development platform to increase their work efficiency. On the other hand, the SME category is projected to register faster growth, during the forecast period. This is due to the inclination toward cloud-based low-code development platforms to minimize resources and cost barrier for application development.
Geographical Analysis of Low-Code Development Platform Market
Globally, North America held the largest market share, of over 40%, in 2018, owing to the increasing mobile application usage as well as presence of a large number of IT companies in the region. As per the GSM Association, smartphone adoption rate in the region was around 80% in 2018, and is expected to reach around 90% by 2025. With increasing smartphone penetration, populace in the region are heavily adopting smartphone applications for various purposes, such as online purchasing, banking, social media interactions, online gaming, and messaging. This digital inclination is directly fueling the growth of the mobile application market, which is further surging the demand for low-code development platforms.
On the contrary, the APAC low-code development platform market is expected to witness the fastest growth during the forecast period. This is due to the rising internet penetration, increasing smartphone penetration, rapid economic growth in major countries, and growing IT service industry in the region. In addition, rising disposal income of the populace in several developing countries in the region is substantially increasing the demand for mobile devices, which in turn, is fueling the growth of the low-code development platform market. Furthermore, APAC countries are the most preferred destination for IT outsourcing. Owing to this, IT companies receive large-scale requests for application development, which further boosting the growth to the market.
Competitive Landscape of Low-Code Development Platform Market
The low-code development platform market is fragmented in nature, characterized by the presence of companies such as Oracle Corporation and salesforce.com Inc. Besides, Appian Corporation, Mendix Technology B.V., Outsystems Inc, ServiceNow Inc, Caspio Inc, Kony Inc, Alphabet Inc are important players operating in the low-code development platform market.
Recent Strategic Developments of Major Low-Code Development Platform Market Players
Major players in the global low-code development platform market were involved in various activities, such as mergers and acquisitions, partnerships, product launches, client wins, geographic expansion, and facility expansion to gain a competitive edge in the market. For instance, in April 2019, Mendix Technology B.V. launched Mendix Studio and Mendix Studio Pro. Mendix Studio is an intuitive no-code platform that includes a suite of templates for various business applications such as budgeting, task and time tracking, and portals. On the other hand, Mendix Studio Pro is a low-code platform that provides low-code visual model-driven environment to developers to build robust, complex, and mission-critical enterprise applications.
Moreover, in July 2018, OutSystems Inc. unveiled new office location in Frankfurt, Germany. This move is aimed at expanding the company’s footprint in DACH region, which includes Germany, Austria, and Switzerland. The region had a combined GDP of $5.5 billion in 2018, and the industries in the region have started to adopt digital transformation. The company is capitalizing on this growth opportunity to increase its client base.
Key Questions Addressed/Answered in the Report