Personalization Software Market Size (2024 – 2030)

The global personalization software market was valued at USD 1.16 billion and is projected to reach a market size of USD 5.14 billion by the end of 2030. Over the forecast period of 2024–2030, the market is projected to grow at a CAGR of 23.7%. 

Software for personalization allows users to alter their computer's or other electronic device's experience. The software may be used to customize how information is presented to users, modify the look of the user interface, and choose which features and programs they view. In the past, this market was used in limited industries. It was used on e-commerce websites to recommend products based on the browser history of the individual. Presently, the market has seen a considerable expansion with technological advancements in artificial intelligence, machine learning, and data analytics. Additionally, economic progress has been advantageous for investments and accessibility. In the future, with a growing focus on innovation and privacy, the market is anticipated to witness a boost.

Key Market Insights:

According to 90% of top marketers, personalization increases revenue for companies. 74% of e-commerce businesses have a program for personalizing their websites. 60% of shoppers agree that after having a personalized shopping experience, they will return. Personalized homepage promos inspire 85% of customers to make a purchase, while personalized shopping cart suggestions impact 92% of online buyers. Linking to data-related technology is, according to 40% of marketers, their largest obstacle when it comes to personalization, while poor data quality is a problem for 34% of them. To address this, organizations are updating their data infrastructure and integration. Additionally, specialized expertise is being put into each company to tackle such concerns

Personalization Software Market Drivers:

Increased demand for enhanced customer experiences has been fueling the growth.

Customers are the major force behind the success of any company and their products. As such, making sure that they are satisfied is crucial. Businesses have started to recognize this aspect and are tailoring their strategies accordingly. As per Statista, the majority of eCommerce businesses, which is around 67% of companies in North America and Europe, want to increase their personalization spending. This technology helps in the customization of products as per the liking of the individual. This takes into account their browsing history, likes and dislikes on any particular page, and other such traits. Based on this data, similar products are recommended for each individual. This creates a sort of attraction and makes sure that the client is interested in checking out and later buying the product. By offering such personalized products, customer loyalty can be achieved for a particular brand. With digitalization being the new normal, having an online presence for any business has become vital. This has caused a drastic rise in the need for this technology to create better revenue.

Technological advancements have been accelerating the market.

Fields like artificial intelligence, machine learning, big data, and data analytics have gained immense prominence. This rapid advancement has led to the generation of vast amounts of data. This data contains all the necessary information that the company needs. These fields generate insights about the customer's preferences and likes that are beneficial for the sales team. They recommend similar products on the pages that the client visits. Moreover, these technologies also help in receiving suitable feedback from the customer about their experience. The answers provided are looked upon to improve the user experience and satisfaction. Because of these technical developments, organizations looking to use data-driven insights to optimize consumer interaction and create business outcomes are adopting personalization software at a higher rate. It is now more powerful, efficient, and accessible.

Personalization Software Market Restraints and Challenges:

Data privacy and regulatory compliance, integration, poor data quality, and associated costs are the main issues that the market is currently facing.

The security of data is one of the biggest barriers in this market. Customers are often concerned about the privacy of the information they have fed to their electronic devices. There have been numerous cases of misuse and leakage exploiting the individual and the company. Stricter regulations like GDPR and GCPA are being enforced worldwide through various platforms. This has secure and advanced security options to avoid fraud and crime. However, this can create a hindrance for the company since a lot of data might not be publicly shared. Secondly, integrating the software with larger and more secure systems is a challenging process. Organizational data silos make it more difficult to access and use complete customer data for personalization, which results in disjointed and ineffective personalization efforts. Thirdly, outdated and incomplete data can create hurdles. This leads to irrelevant information and recommendations, leading to poor performance. As such, ensuring the accuracy of the data that is available is extremely important for customer satisfaction. Moreover, constraints on budgets can be an obstacle. The initial expenses that are required can be very high. Besides, updates and maintenance charges add up. Smaller firms can face difficulties in accommodating these costs.

Personalization Software Market Opportunities:

E-commerce has been providing the industry with numerous possibilities. Online shopping has gained a lot of attention. All necessities and luxurious items are available on various online platforms. Customers are leaning towards these channels owing to their convenience. Items are delivered to their household. Adding personalization to these channels is, therefore, beneficial. This technology sends updates about the latest products available to customers. Reminders are also sent every month to increase sales. As more customers shop online, businesses are focusing on personalization to increase profits. Besides this, to gain customer loyalty, specialized gifts, promotions, incentives, and discounts are being provided to members. This is creating a broader customer base. Vendors may provide tailored experiences that cater to the unique aims and objectives of businesses in each vertical by comprehending the industry-specific requirements and pain areas. This understanding can lead to increased acceptance and market penetration.

PERSONALIZATION SOFTWARE MARKET REPORT COVERAGE:

Personalization Software Market Segmentation: By Operating System

• Android

• iOS

Based on the operating system, Android has the largest market share in 2023. The primary reason for this is that this category has a larger number of users. Its open-source nature allows easier customization, making the integration feature easier for developers. It seemingly integrates with many apps, making it easier to know about likes and dislikes. This flexibility encourages innovation and experimentation. However, iOS is the fastest-growing segment. A greater percentage of the population can afford these smartphones and laptops. This has increased the demand for personalization on this operating system. Besides, Apple has been coming up with many launches and updates of the iPhone that have been attracting a lot of people due to its advanced features and functionalities. Strong privacy and security features, such as biometric authentication, end-to-end encryption, and stringent app review policies, are among iOS's best-known attributes. Users are more willing to share personal information and interact with personalized experiences on the platform because of these features, which foster trust and confidence in them.

Personalization Software Market Segmentation: By Application

• Commercial Use

• Personal Use

Commercial use has the largest application. This category mainly includes e-commerce. A sizeable portion of the industry is occupied by e-commerce companies that heavily engage in personalization software to improve user experiences, boost sales, and foster customer loyalty. Personal use is the fastest-growing application. This mainly includes streaming shows. Shows on Netflix, Hot Star, and Disney have become very popular. A lot of people binge-watch the shows and series on these platforms. Based on the series the individual likes, similar shows are recommended to engage more users.

Personalization Software Market Segmentation: By Industry

• Aerospace & Defense

• Automotive & Transportation

• Banking, Financial Services & Insurance

• Building, Construction & Real Estate

• Consumer Goods & Retail

• E-commerce

• Education

• Energy and Utilities

• Government & Public Sector

• Healthcare & Life Sciences

• Information Technology

• Manufacturing

• Media & Entertainment

• Telecommunication

• Travel & Hospitality

Banking, Financial Services, and Insurance (BFSI) is the largest market for customization software. To draw and keep consumers in a very competitive market, financial institutions use personalization technologies to provide customized banking services, individualized investment advice, focused marketing efforts, and improved customer experiences. E-commerce is the fastest-growing industry. E-commerce companies heavily invest in personalization technology to deliver targeted product recommendations, personalized promotions, dynamic pricing strategies, and customized user experiences to drive sales and customer loyalty. This is due to the growing trend of online shopping and the growing demand for personalized shopping experiences.

Personalization Software Market Segmentation: Regional Analysis

• North America

• Asia-Pacific

• Europe

• South America

• Middle East and Africa

North America has the largest market. The economy is the primary cause of this. This makes investing and raising money easier. In addition, some of the industry's most well-known players are present in this region. These businesses are globally renowned, which boosts their earnings. A few of them include Adobe Inc., Salesforce, Oracle Corporation, and SAP SE. In North America, the United States and Canada hold a prominent position. Asia-Pacific is the area with the fastest rate of growth. At the top are nations like South Korea, China, Japan, and India. A growing middle class and greater discretionary income are the results of urbanization. Consequently, investments have improved. Venture capitalists have provided finance to several international corporations and startups. Innovative solutions and technology are being developed by several companies, boosting growth.

COVID-19 Impact Analysis on the Global Personalization Software Market:

The outbreak of the virus had a positive impact on the market. The new norm included social isolation, travel restrictions, and lockdowns. Most of the companies had to shut down to prevent the spread of the virus. This caused a digital transformation. Online retail came to the rescue since a lot of people could not or feared stepping out. This increased the reliance on digital interactions. Businesses have invested in these technologies since most people started using online apps for various deliveries. All necessities, from groceries to clothes, were purchased through this medium. To adapt interactions and content to consumers' evolving requirements and preferences, personalization software was essential. As per a survey conducted by Yieldify, 89% of businesses were planning to implement AI-driven predictive segments for personalization during the pandemic. Post-pandemic, the market has continued to grow owing to demand and advancements.

Latest Trends/ Developments:

Businesses in this sector are driven to grow their market share through a variety of tactics, such as investments, joint ventures, and acquisitions. Companies are investing a significant amount of money in developing strategies to maintain competitive pricing. This has led to more growth. Conversational interfaces and voice-activated gadgets are creating new avenues for personalization. Enterprises are investigating methods to utilize speech recognition and natural language processing to customize communications and offer customized suggestions via voice assistants and chatbots.

Key Players:

1. Adobe Inc.

2. Salesforce

3. Oracle Corporation

4. SAP SE

5. IBM Corporation

6. Optimizely

7. Dynamic Yield

8. Evergage

9. Qubit

10. Sitecore

In January 2023, through an exchange filing, Tata Consultancy Services announced the launch of TCS Customer Intelligence & InsightsTM (CI&I) for Retail 3.0, a tool designed to assist retailers in strengthening their bonds with customers by providing hyper-personalized engagement at every stage of the customer experience. At important physical and digital touchpoints, the software produces insights, forecasts, and actionable recommendations that boost customer happiness, boost return on marketing spending, and extend customer lifetime value.

In April 2023, Salesforce revealed new features for Customer 360 for Health. These features are intended to save operating costs and enable healthcare providers to offer individualized patient experiences.