Defining a Strong Value Proposition Critical to Achieving Growth in Enterprise Analytics Market

Frost: The growing enterprise-wide adoption of analytics as a valuable decision-making tool to assess business performance and map future growth, is compelling vendors to redefine their position in a highly competitive market. Verticalization, compliance requirements and developing a more comprehensive portfolio of solutions are the key market dynamics in the analytics space.

Te North America Enterprise Analytics Markets earned revenues of $2.22 billion in 2005 and estimates this market to reach $4.54 billion in 2012, growing at a CAGR of 10.8% during 2006-2012.

Enterprise analytics must empower decision-makers in organizations with mission-critical, real-time information to tap into emerging growth opportunities. This would allow vendors to provide their installed base of customers with value-added performance management functionality and identify opportunities for future revenue growth.

Further, the creation of solutions for the extended value chains in organizations that include channel partners and suppliers expands the value proposition to the existing installed base and enables improved and well-informed decision-making across the enterprise. Vendors are increasingly inclined to target their solutions toward those organizations that are required to adhere to compliance and regulatory norms such as Sarbanes-Oxley Act, Basel-II and others. Targeted marketing in niche customer segments and right fitment of solutions into specific customer needs, especially in the small and medium-sized businesses (SMBs), are important for incremental revenue growth.

Although analytics are increasingly meriting their place as core software investments in different organizations, analytics vendors are likely to find that poor data quality and bottlenecks of integration affect the overall value from these solutions. The complexity in IT infrastructure and disconnect among various enterprise systems stretch the integration process and ultimately results in delayed realization of return on investment from analytics deployments, notes Arun Ranganath.

Vendors need to offer solutions tailored to the needs of specific verticals in order to enable faster deployment and seamless integration. This would also present vendors with opportunities for market penetration in niche customer segments across verticals. Such initiatives are also likely to be pronounced in growing firms, as IT initiatives can be mapped to the growth patterns of the enterprise in the initial phases itself.

For vendors who do not have individual expertise to scale up their analytics portfolio with offerings specific verticals, the option of entering into strategic associations with established industry partners or system integrators would be immensely beneficial, concludes Ranganath.

North America Enterprise Analytics Markets Publ 20060508