Key regions: Brazil, Germany, United Kingdom, Netherlands, China
The demand for Application Outsourcing services in the EU-27 region has been steadily increasing over the past few years.
Customer preferences: One of the main reasons for this growth is the increasing preference of companies to outsource their non-core activities to third-party service providers. This allows them to focus on their core competencies and reduce costs. Additionally, with the rise of digital transformation, companies are increasingly relying on technology to improve their operations and stay competitive. This has led to an increased demand for application outsourcing services, as companies look to leverage the expertise of service providers to develop and maintain their technology infrastructure.
Trends in the market: The application outsourcing market in the EU-27 region is characterized by a few key trends. Firstly, there is a growing preference for nearshore outsourcing, where companies outsource to service providers in neighboring countries rather than offshore locations. This is driven by factors such as language and cultural similarities, as well as the ability to access a larger pool of skilled resources. Secondly, there is a shift towards outcome-based pricing models, where service providers are paid based on the results they deliver rather than the number of hours worked. This incentivizes service providers to focus on delivering high-quality outcomes rather than simply putting in more hours. Finally, there is an increasing adoption of automation and artificial intelligence (AI) in application outsourcing. This is driven by the need for faster and more efficient development and maintenance of applications, as well as the ability to leverage data insights to drive business outcomes.
Local special circumstances: The application outsourcing market in the EU-27 region is diverse, with each country having its own unique characteristics. For example, countries such as Germany and France have a strong focus on quality and security, which has led to a preference for onshore outsourcing. On the other hand, countries such as Poland and Romania have a large pool of skilled resources and a lower cost of living, making them attractive destinations for nearshore outsourcing. Additionally, countries such as Ireland and the Netherlands have a strong focus on innovation and technology, which has led to the growth of niche service providers specializing in areas such as AI and blockchain.
Underlying macroeconomic factors: The growth of the application outsourcing market in the EU-27 region is also influenced by underlying macroeconomic factors. For example, the region has a highly skilled workforce and a strong tradition of innovation, making it an attractive destination for companies looking to outsource their technology requirements. Additionally, the increasing adoption of cloud computing and digital transformation is driving demand for application outsourcing services. Finally, the ongoing COVID-19 pandemic has accelerated the adoption of remote working and digital technologies, further fueling the growth of the application outsourcing market in the EU-27 region.
Data coverage:
The data encompasses B2G, B2B, and B2C enterprises. Figures are based on enterprises' technology spending on products, consulting, and outsourcing services.Modeling approach / Market size:
Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players in the industry, Statista's primary research and surveys, and IT associations. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, internet users, and telecommunication. This data helps us estimate the market size for each country individually.Forecasts:
In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the exponential trend smoothing method is used based on the market data characteristics. The main drivers are the GDP and its sector composition, internet penetration, the level of digitization, and the attitude toward IT security.Additional notes:
The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.
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