E-Commerce Platform Software Market

Market Overview

The global e-commerce platform software market size was valued at USD 7.21 billion in 2023. It is estimated to reach USD 20.05 billion by 2032, growing at a CAGR of 12.04% during the forecast period (2024–2032). In recent years, the world has witnessed a rapid proliferation of the internet and smartphones in the wake of digitization, which has led to a rapid growth of the e-commerce industry. This growth of the e-commerce industry is anticipated to drive the global e-commerce platform software market. Moreover, integrating technologies like AI and ML into e-commerce platforms to enhance efficiency is estimated to create opportunities for global market growth.

"E-Commerce Platform Software" refers to software designed to facilitate online transactions, manage online storefronts, and handle various aspects of electronic commerce. These platforms typically provide tools for creating and managing product listings, processing payments, managing orders, and handling customer interactions. They frequently incorporate functions like inventory management, customer relationship management (CRM), marketing tools, analytics, and interaction with third-party services like shipping carriers and payment gateways.

Some popular examples of e-commerce platform software include Shopify, Magento, WooCommerce (built on WordPress), BigCommerce, and Salesforce Commerce Cloud. These platforms vary in features, scalability, customization options, pricing models, and target audiences, catering to the needs of small businesses, mid-sized enterprises, and large corporations.

Highlights

• North America is the highest shareholder in the global market

Market Dynamics

Global E-Commerce Platform Software Management Market Drivers

Expanding Global E-commerce Sector 

The e-commerce industry across the world has been growing at a rapid pace over the past few years. According to WordPress Tutorial, by the end of 2023, 2.64 billion people were shopping online. As of January 2024, the world's population is around 8 billion. These eCommerce statistics indicate that at least 33% of people worldwide shop online to meet their needs, marking a 5% increase from 2022.

Furthermore, the user penetration will reach 53.9% in 2024 and is estimated to hit 63.2% by 2028, turning 4.5 billion people into e-commerce market consumers over the next four years. China and the United Kingdom had the highest share of e-commerce sales out of the total retail sales. Several factors, including the growing penetration of the internet and smartphones, majorly augmented the growth of the e-commerce industry. Therefore, the rapid growth of the e-commerce industry drives the global e-commerce platform software market, as this platform forms a vital part of the functioning of e-commerce platforms.

Global E-Commerce Platform Software Management Market Restraint

Security Concerns 

Security concerns in the e-commerce platform software market are a significant restraint stemming from the escalating threat of cyberattacks and data breaches. Consumers are increasingly apprehensive about their personal and financial information safety when conducting online transactions.

High-profile incidents of data breaches have eroded trust in e-commerce platforms, leading to hesitancy among potential users. Moreover, the evolving tactics of cybercriminals pose a continuous challenge, necessitating robust security measures to safeguard sensitive data. Market expansion may be hampered by failing to address these issues, which could harm e-commerce companies' reputations and cause a loss of consumer trust.

Global E-Commerce Platform Software Management Market Opportunities

Emergence of AI and Machine Learning

AI and machine learning technologies are incorporated into e-commerce platforms to enhance product recommendations, optimize pricing strategies, automate customer support, and streamline operations. Businesses seek e-commerce platform software with AI capabilities to gain a competitive edge. Therefore, market players are trying to incorporate these technologies into their platforms. For instance, in September 2023, Shop Circle, a software provider for e-commerce companies, completed its Series A investment round by receiving USD 120 million. This funding will support the company in developing and growing its range of e-commerce tools.

Shop Circle is now creating advanced AI tools and procedures to improve the scalability of its main activities in all stages. Shop Circle has introduced a data-driven tech stack consultation program alongside its complete platform. The company seeks to enhance brands' technology infrastructure by utilizing AI and highly tailored data-driven insights, lowering expenses, and boosting conversions to provide exceptional client experiences. These factors present opportunities for market expansion.

Regional Analysis

North America Dominates the Global Market

Based on region, the global e-commerce platform software market is bifurcated into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa.

North America is the most significant global e-commerce platform software market shareholder and is expected to expand substantially during the forecast period. North America dominates the e-commerce platform software market, which is attributed to the presence of major market players, technological advancements, high internet penetration, and robust e-commerce infrastructure. There has been a rising number of e-commerce users in this region. For instance, according to Statista, between 2024 and 2028, the number of users in the E-commerce market in the United States was projected to grow by a total of 50.7 million users, representing a 17.92 percent rise. In 2028, the indicator is projected to reach 333.65 million users, marking a new peak after nine consecutive years of growth. This is anticipated to increase the revenue in the e-commerce industry.

Furthermore, as per the same source, between 2024 and 2028, the revenue in the United States e-commerce market is projected to climb by a total of 475.2 billion U.S. dollars, representing a 56.32 percent growth. The indicator is projected to reach 1.3 trillion U.S. dollars in 2028 after ten straight years of growth, marking a new milestone. Similarly, the key market players are involved in several strategic initiatives like mergers and acquisitions, collaborations, expansions, etc., to enhance their market share. For instance, in April 2022, Assembly, a Los Angeles-based e-commerce software platform, acquired PipeCandy, a top vertical DaaS startup and market intelligence platform that monitors data on 5.4 million websites. Consequently, these factors drive the regional market growth.

Asia-Pacific is predicted to grow significantly in the e-commerce platform software market, fueled by rapid urbanization, expanding internet connectivity, rising disposable incomes, and the proliferation of smartphones, particularly in countries like China, India, and Southeast Asian nations. Moreover, the Asia-Pacific e-commerce industry has been on an upward path and is estimated to surpass technologically developed regions. According to Statista, with a population of over 1.4 billion and a rapidly expanding economy, the online shopper count is forecasted to reach 427 million by 2027. The thriving e-commerce sector is projected to exceed 350 billion U.S. dollars by 2030. This is expected to foster the Asia-Pacific market expansion.

Furthermore, robust security software introduced by the government in this region is anticipated to enhance market growth. For instance, in October 2023, the Department of Consumer Affairs (DoCA) launched the Dark Patterns Buster Hackathon 2023 in collaboration with IIT-BHU to help develop a design and prototype innovative app or software-based solutions that can identify if an e-commerce website is using one or more dark patterns.

Segmental Analysis

The global e-commerce platform software market is bifurcated into deployment, platform, application, business size, and industry.

Based on the deployment, the global e-commerce platform software market is bifurcated into on-premises and Software as a Service (SaaS).

Several businesses use Software as a Service (SaaS) systems and apps such as Salesforce, Google Apps, and Office 365 for operational activities. Businesses can precisely decide when SaaS e-commerce is used instead of open-source or on-premise software. SaaS platforms are licensed on a subscription basis where users pay monthly, based on the levels of services requested, making them cost-effective for small- and medium-sized enterprises.

Moreover, there has been a rise in the investment in such platforms. For instance, in November 2023, the funds advised by Bregal Unternehmerkapital ("BU") announced they had made a majority investment in Billbee GmbH from Twistetal in northern Hesse. Billbee is the leading provider of multichannel e-commerce software SaaS solutions for small e-commerce retailers in the DACH region. Such factors drive the segment growth.

Based on the platform, the global e-commerce platform software market is bifurcated into hosted e-commerce platforms and self-hosted e-commerce platforms.

Self-hosted e-commerce platforms are software solutions that enable individuals or businesses to build and manage their online stores on their own servers or hosting environments. Self-hosted e-commerce platforms offer users greater control over their online stores, including customization, security, and scalability, in contrast to hosted e-commerce platforms (like Shopify or BigCommerce), where the service provider hosts and manages the entire platform. Self-hosted platforms are more customizable and offer more control than hosted solutions, but they usually require more technical experience to set up, configure, and support. Moreover, these platforms can be easily moved if they outgrow their supplier chains and find better deals elsewhere because they are not tied to a centralized service.

Based on business size, the global e-commerce platform software market is bifurcated into small, medium, and large.

Small businesses typically have fewer employees and generate less revenue annually than larger corporations or enterprises. They can be privately held companies, partnerships, or sole proprietors. Several government initiatives have been considered globally to boost small businesses, along with initiatives promoting digitalization. For instance, the Indian government's 'Make in India,' 'Vocal for Local,' and 'Digital India' initiatives direct entrepreneurs into the manufacturing business, offering growth opportunities for the market. 

Based on application, the global e-commerce platform software market is bifurcated into catalog management, inventory management, SEO management, shopping cart, returns management, order management, email marketing, multi-store management, channel management, and others.

E-commerce platform software streamlines inventory management by centralizing control, offering real-time tracking, and automating processes. Businesses can monitor stock levels accurately, prevent stockouts, and instantly update inventory across all channels. Order processing and inventory updates are guaranteed to go smoothly through integration with order management systems.

Furthermore, tools for forecasting aid in demand prediction and replenishment strategy optimization. Multi-warehouse support enables efficient distribution, minimizing shipping costs. Moreover, barcode and SKU management enhance tracking accuracy while reporting tools offer insights for informed decision-making. Integration with third-party systems extends functionality while scalability accommodates business growth.

Based on industry, the global e-commerce platform software market is divided into food and beverage, fashion and lifestyle, health and beauty, media and entertainment, automotive, consumer electronics, and others.

E-commerce platform software revolutionizes the fashion and lifestyle industry by providing an online marketplace for retailers to show their products, reach a wider audience, and facilitate seamless transactions. These platforms offer customizable storefronts, inventory management, secure payment processing, and analytics tools tailored to the unique needs of fashion businesses. They enhance customer experiences through personalized recommendations, virtual try-ons, and interactive features, driving sales and brand loyalty. Moreover, they enable businesses to adapt to changing trends quickly, optimize marketing strategies, and expand globally. E-commerce platform software empowers fashion and lifestyle brands to thrive in the digital marketplace, fostering growth and innovation.

Recent Developments

• February 2024- E-commerce software solution Wix collaborated with Global-e, a cross-border software solution provider. Thus, sellers can take advantage of additional features such as localized checkout, different currencies, and market-specific pricing.
• February 2024- Neiman Marcus Group announced that it will not proceed with using Farfetch’s e-commerce software to update the luxury department store’s online site and app.