Financial analytics lets the managers and executives in an organization to have access to more accurate and detailed financial information of the organization. This strengthens the relationship of the employee inside the organization. Financial analytics is a field that gives different views of a company’s financial data.
Global financial analytics market is anticipated to grow with 10.05% CAGR during the forecast period 2019-2027. The base year considered for the study is 2018 and the estimated period is between 2019 and 2027.
Key factors that are responsible for the market advancement are:
- Rise in need of real-time data analytics & decision-making
- Rapid change in business environments worldwide
- Technological improvements in analytics domain
- Adoption of analytics by asset management firms
However, the global financial analytics market is driven by a rapid change in business environments worldwide. Transformation in business is a constant part of business life. All business must have to be aware of the internal and external environment to remain competitive and to identify the trends and new value positions and change the operation mode to exploit the advantages in business which they identify. Serving the world by implementing some of the simple technology like “Big data” often blinds the industries to real business challenges for customer relationship management and ensuring of the reliable service. Implementations of technologies are simple in industry.
In terms of end user segment, travel & hospitality segment is the fastest growing market in terms of revenue with around XX% market share in 2018. In the hospitality industry, analytics can be used in numerous ways to improve business operations, profits, marketing strategies, occupancy rates and yield. For example, through analytics, the concierge can know the local tours to recommend that fit a guest’s preference based on his past behavior. It allows the restaurant department to predict which menu items are likely to be ordered, for example, on the local weather. It allows the reservation department to predict the optimal rate for a room. It enables the sales and marketing team to create and send tailored messages across different networks. Analytics can also help hoteliers cut down their energy costs without sacrificing guest comforts.
As the use of analytics is growing rapidly, it will also have some hindrances associated with it. For instance, issues related to data security together with privacy in the financial analytics market, technological limitations, lack of skilled workforce to deal with the financial analytics data and resistance for the adoption of financial analytics by companies and the employees can occur which can withhold the market growth. Companies are increasingly recognizing the importance of financial analytics software. But security and privacy are the major concern for the financial analytics market. Nowadays, hackers are well trained and funded; as a result, cybercrime is on the rise, resulting in approximately $XX billion annual losses in business. The number of attacks is expected to increase as hackers mark other types of accounts as well as the ones registered with credit cards. The possible losses are growing since numerous hoaxers & conmen have pilfered large volumes of extra personal information like social security numbers that they haven’t used up till now. Nowadays, business entity wants more transparency and security due to the increasing number of frauds, misrepresentation and concealment of facts being done by business houses.
Global financial analytics includes segmentation on the basis of components, deployment mode, organization size, tools, applications, end users and regions.
Components division is sub-segmented into:
Deployment mode is sub-segmented into:
- Cloud based
Organization size is sub-segmented into:
- Large enterprise
- Small & medium enterprise
Tools division is sub-segmented into:
- Analytical solutions
- Database Management System (DBMS)
- Data integration tools
- OLAP & visualization tools
- Query, reporting & analysis
- Consulting & support services
Applications segment is sub-segmented into:
- General ledger management
- Assets and liability management
- Budgetary control management
- Governance, risk and compliance (GRC) management
- Profitability management
- Receivables management
- Payables management
- Other applications
End users division is sub-segmented into:
- Banking, Financial Services & Insurance (BFSI)
- Consumer Goods & Retail
- Public sector, Energy & Utilities
- Transportation & Logistics
- IT & Telecommunication
- Travel & Hospitality
- Media & Entertainment
- Healthcare & Life Sciences
- Other End Users
The total market revenue is calculated on the basis of the adoption of financial analytics across various verticals.
Geographically, the global financial analytics market has been segmented on the basis of four major regions, which includes:
- North America: the United States & Canada
- Europe: United Kingdom, France, Italy, Russia, Spain, Germany and Rest of Europe
- Asia Pacific: China, India, Japan, Australia, South Korea & Rest of Asia Pacific
- Rest of World: Latin America, Middle East & Africa
The regional paradigm of global financial analytics market is dominated by North America region by capturing the largest market share regarding revenue of XX% in 2018. In 2018, North America accounted for a revenue share of XX% in the global financial analytics market. North America is a major financial analytics market in terms of revenue. With the majority of world’s top financial service companies headquartered in North America, growing income disposable population, positive economic prospects and high big data technology adoption rate are some of the factors driving the growth for the financial analytics market in North America. SME’s, government, public utilities, are some of the growing verticals in the financial analytics market in North America.
On the flip side, Asia Pacific region is expected to surge with the fastest growth rate during the forecasted period. The Asia Pacific is one of the most important regions in the market of financial analysis. Asia Pacific region contributes to about 30% of world economic output. Cross-border economic flow such as bank lending and direct investments are growing faster than GDP in Asia Pacific financial market. Companies dealing in large financial investments are dependent on chief financial officers for the analysis of their internal financial and operational data by considering external data obtained from cloud based big data, social media platforms and demographics. Increasing adoption of cloud based financial analytic tools that are readily available to the companies is mainly promoting growth in the market of Asia Pacific region. Asia Pacific region has a huge opportunity to play a big role in investment and risk management system of the global capital market.
Global financial analytics is segmented by components, deployment mode, organization size, tools, applications, end users and regions.
Components are sub-segmented into software & services. Deployment mode is sub-segmented into cloud based & on-premises. Organization size is sub-segmented into large enterprise & small & medium enterprise. Tools are sub-segmented into analytical solutions, database management system (DBMS), data integration tools, OLAP & visualization tools, query, reporting & analysis, and consulting & support services. Applications are sub-segmented into general ledger management, assets and liability management, budgetary control management, governance, risk and compliance (GRC) management, profitability management, receivables management, payables management & other applications. End users are sub-segmented into banking, financial services & insurance (BFSI), consumer goods & retail, public sector, energy & utilities, transportation & logistics, IT & telecommunication, travel & hospitality, media & entertainment, healthcare & life sciences, government, manufacturing and other end users.
The market has many players, and some of the key players involved in global financial analytics market are:
- Hitachi Consulting
- Information Builders
- Other companies
Market share analysis along with company profiles of the prominent market players are discussed in detail. In February’ 18, Deloitte announced the launch of its Cognitive Analytics Solution Center of Excellence (CoE) that will apply cognitive and advanced analytics techniques to deliver risk sensing and predictions to global clients. As organizations face ongoing disruption in their industries, risk sensing with the help of human insights and advanced analytics capabilities to identify, analyze and monitor emerging risks, this has become a key component of how organizations manage risk. In October 2018, BI and analytics firm Information Builders recently announced the relaunch of its signature platform, WebFOCUS. In a release issued by the company, Information Builders said this update, with its fully responsive user interface and intuitive workflow, delivers unparalleled ease of use with scale and function. This enables employees across an organization, not just in IT or analytics, to access information and leverage data for insights.
Key findings of the global financial analytics market are as follows:
- The emergence of cloud analytics is boosting the cloud based deployment of financial analytics solutions
- Banking and financial institutions are key end user industry
- Increase in partnership, mergers and acquisition scenarios between IT & finance companies
- North America holds the largest market share of the financial analytics market
- Asia Pacific is the fastest growing region for financial analytics market