Data Preparation Tools Market

Market Overview

The global data preparation tools market size was valued at USD 4,293.6 million in 2022. It is estimated to reach USD 19,189.9 million by 2031, growing at a CAGR of 18.1% during the forecast period (2023–2031). The increasing need for expeditious analysis of intricate combinations of data presents a challenge to current data integration methodologies, which frequently prove to be excessively time-consuming and inflexible in meeting this escalating need. These issues are contributing to an increased need for data preparation solutions that are both user-friendly and adaptable.

Data preparation tools are software programs that automate the process of gathering, cleaning, processing, and organizing raw data for use in analytics and business intelligence. Data preparation tools have a wide range of uses worldwide, including data cleansing, aggregation, integration, data wrangling and engineering, data enrichment, and data quality monitoring. These technologies are used to prepare data for various applications, including predictive modeling and machine learning, as well as business intelligence and reporting. They contribute to data correctness, completeness, consistency, and timeliness and can considerably improve the efficacy and efficiency of data-driven decision-making.

Market Dynamics

Global Data Preparation Tools Market Drivers:

Importance of Effective Data on a Timely Basis

In data-driven industries like IT and BFSI, data preparation is more widely accepted. These tools' primary function is to efficiently find the right data at the right time. These tools' primary function is to efficiently find the right data at the right time. However, problems with data preparation could provide time-consuming and inadequate outcomes, which would impede decision-making. The analytic tools and BI users spend a great time finding the right data. However, in many cases, the data found may be flawed or not prepared as per the requirements.

Moreover, user collaboration with analysts leads to effective data preparation as analysts can gain deeper insights into users' requirements. For instance, users spend more time developing queries and questions that analysts may have already developed, which the users could directly use. Despite the highly automated data preparation processes, many BI analysts spend significant time preparing the data rather than analyzing it. This is because the availability of a large volume of data can often lead organizations to spend more time cleansing the data.

Self-Service Data Preparation Tools

With the growth of self-service analytics, organizations must support various user requirements for analyzing and accessing different data types. Users seek technologies supporting ad-hoc data transformation, integration, and quality improvement. Self-service data preparation tools are gaining wide acceptance as they enable users to work with the data independently, with lesser handholding from IT. Analytics is now fundamental to any business. Therefore, the market for business intelligence and advanced analytics is growing, and self-service data preparation technologies are becoming more popular in response to the desire for faster and deeper insights into various data sources. However, the rising need for quick analysis of complex data combinations poses a challenge to the existing data integration approaches that are often too time-consuming and rigid to keep up with the growing demand. These challenges are enhancing the demand for easy-to-use and adaptive data preparation tools.

Global Data Preparation Tools Market Restraint:

Organizational Barriers to Data Preparation

The implementation of updates to data preparation tools might provide a range of obstacles, mostly because most upgrades are typically linked to enhancements in processes. Moreover, low budgets assigned by most organizations in the development of data preparation tools act as a major hurdle in the upgrade process of such tools. Data professionals face difficulties convincing higher management to invest in improving data preparation tools and enhancing the quality of data assets.

Several organizations often initiate investments in such tools only after a regulatory policy or a project requirement, such as consolidation of systems after an acquisition. Thus, it becomes difficult for a data steward in any organization to quantify and demonstrate a relationship between poor data quality and preparation, which results in process inefficiency and revenue loss. Data preparation tools must be updated after a certain time, just like any other technology. The person handling these technologies also requires appropriate training to upgrade the technology. As such, a lack of proper training acts as a restraint to the growth of the data preparation market.

Global Data Preparation Tools Market Opportunities:

Growing Demand for More Interactive and Engaging Text and Image

The introduction of digital capturing devices, notably smartphone cameras, has resulted in an exponential increase in the volume of digital material in the form of photographs and movies. Many visual and digital information is being gathered and shared via various apps, websites, social networks, and other digital platforms. Various firms have employed data annotation techniques to improve the efficiency and quality of their consumer service, leveraging the vast resources available on the internet. Image labeling enables online consumers to search for clothing or accessories by capturing images of desired textures, prints, or colors. The photograph taken with the smartphone is uploaded to an application that uses artificial intelligence technology to search inside a database of available products, seeking out similar items.

Regional Analysis

Based on region, the global data preparation tools market is bifurcated into North America, Europe, Asia-Pacific, South America, and the Middle East and Africa.

North America Dominates the Global Market

North America is the most significant global data preparation tools market shareholder and is expected to exhibit a CAGR of 9.11% over the forecast period. The region's massive market share may be ascribed to the increasing integration of innovative technologies like mobile computing and AI (Artificial Intelligence) in e-commerce. Similarly, rising investments in analytics across the region, notably in the United States, are expected to boost market expansion. Significant market growth opportunities are anticipated due to the existence of major industry players in North America.

Moreover, the increasing number of improvements in these organizations is expected to boost market expansion. For example, SAS Institute, situated in the United States, developed an advanced and self-service information preparation tool in January 2018 to enable corporate customers to improve their analytical capabilities, productivity, and reusability. The company increased its product offerings and market dominance after releasing this data preparation tool.

Asia-Pacific is anticipated to exhibit a CAGR of 13.3% over the forecast period. The Asia-Pacific data preparation tools market is expected to grow fastest over the forecast period. Nations such as South Korea, India, Japan, and China are significantly responsible for market expansion. The rising need for analytics in developing markets will boost the region's growth. Furthermore, increased internet penetration and expanding smartphone users in Asia are expected to provide enormous market potential prospects. Furthermore, increased investments in cloud-based solutions by startups in emerging markets are expected to boost market expansion.

In Europe, due to the growing use of big data analytics, AI, IoT, and cloud computing in different industries, the data preparation tools market is likely to rise substantially over the forecast period. Europe's biggest markets include the UK, Germany, France, and Italy, where technology and service sectors drive data preparation tool demand. The market will likely rise as firms engage in data preparation technologies to comply with data privacy and security standards. Tools for data visualization, natural language processing, and machine learning will probably promote market expansion in Europe. Real-time data and the requirement to extract insights from diverse data sources have increased the usage of data preparation technologies across sectors. Startup culture, government digitalization, and automation initiatives are projected to boost the region's data preparation tools industry. Europe will boost the worldwide data preparation tools market in the next years.

In South America, the pandemic has changed consumer behavior, prompting companies to use data preparation tools to get insights and customize customer experiences, boosting market growth. Data preparation tools in healthcare are projected to boost market growth in the area. Data preparation tool manufacturers could also benefit from the rising demand for analytics tools in South American financial services. Data preparation tools are also projected to be adopted as knowledge of sophisticated technologies like machine learning and big-data analytics grows. Data preparation technologies are expected to increase rapidly in South America.

Segmental Analysis

The global data preparation tools market is bifurcated into platform, deployment, function, and end-user.

Based on the platform, the global data preparation tools market is bifurcated into self-service platforms and data integration.

The self-service segment dominates the global market and is expected to exhibit a CAGR of 27.1% over the forecast period. Self-service platforms are gaining popularity in the data preparation market owing to benefits such as agile data accessibility, increased data security, and advanced capabilities such as data governance. Many big data and analytics businesses, like Talend and Datameer Inc., have embraced the self-service segment widely since it gives them and Talend a competitive advantage. The self-service platform aids in the analysis of data acquired from IoT devices, allowing enterprises to improve their business intelligence.

Similarly, in March 2016, IBM teamed with Datawatch to provide better and faster access to information for IBM Cognos Analytics and IBM Watson Analytics customers and improved self-service information preparation capabilities. The increasing use of the self-service platform is expected to boost the segment's growth.

Based on deployment, the global data preparation tools market is segmented into on-premises and cloud services.

The on-premises segment dominates the global market and is predicted to exhibit a CAGR of 9.1% during the forecast period. The on-premises segment is currently dominating the market. However, cloud deployment is anticipated to experience a surge in demand throughout the forecast period due to technological developments and the increasing usage of cloud technology across multiple industries, including retail, IT, and telecom. The self-service platform is also being widely accepted in the data preparation market. Combining cloud technologies with a self-service platform is a popular trend that various data-driven IT companies adopt. This offers users access to local and cloud sources, thereby significantly increasing the company's efficiency.

Based on function, the global data preparation tools market is bifurcated into data collection, cataloging, quality, and governance.

The data collection segment owns the highest market share and is predicted to exhibit a CAGR of 16.8% over the forecast period. The data collection segment is expected to dominate the market because it offers users access to data from various sources. The segment's expansion may be attributable to rising demand for these preparation tools across various industries, including IT and Telecom, BFSI, and others. An information integration platform allows the user to comprehend the data, enhance and restructure it, and then load it into the target data source.

Based on end-users, the global data preparation tools market is divided into IT and telecom, retail and e-commerce, BFSI, government, healthcare, energy and utilities, and others.

The IT and telecom segment is the most significant contributor to the market and is estimated to exhibit a CAGR of 19.61% over the forecast period.

Recent Developments

• April 2023- IBM released its new Data Preparation for Watson Studio product. This tool helps users prepare data for examination in Watson Studio, a cloud-based data science and machine learning platform.

• February 2023- Dataiku, a major provider of data science and machine learning tools, was acquired by Informatica. This purchase will enable Informatica to broaden its data preparation capabilities and provide its clients with a more complete data analytics platform.