The alternative data market reached a value of nearly at $1,440.8 million in 2020, having increased at a compound annual growth rate (CAGR) of 58.3%. since 2015. The market is expected to from $1,440.8 million in 2020 to $10,213.8 million in 2025 at a rate of 48.0%. The market is then expected to grow at a CAGR of 36.3% from 2025 and reach $47,973 million in 2030.
Growth of alternative data market revenue in the historic period resulted from increase in rising penetration of e-commerce, strong economic growth in emerging markets, increased internet penetration and increased availability of mobile devices.
Going forward, increased numbers of smart cities, increase in internet penetration, increasing adoption of 5g networks, favorable government initiatives and growing interest in stock trading will drive the growth. Factors that could hinder the growth of the alternative data market in the future include data localization, open source software and security challenges.
The alternative data market is highly fragmented with many small players operating in the market. The key players in the market are focusing on expanding their operational presence in through strategic acquisitions and new launches. The top ten competitors in the market made up to 7.54% of the total market in 2020. Ravenpack International SL was the largest competitor with 1.75% of the market, followed by 1010data, Inc. with 1.64%, Vortexa Ltd. with 0.97%, Eagle Alpha Ltd. with 0.62%, Audit Analytics with 0.62%, Thinknum Inc. with 0.44%, Thasos Group with 0.42%, Yewno, Inc. with 0.42%, Advan Research Corporation with 0.37%, and Exante Data, LLC with 0.28%.
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The alternative data market is segmented by data type into credit and debit card transactions, email receipts, geo-location (foot traffic) records, mobile application usage, satellite and weather data, social and sentiment data, web scraped data, web traffic and other data type. The credit and debit card transactions market was the largest segment of the alternative data market segmented by data type, accounting for 23.8% of the total in 2020. Going forward, the mobile application usage market is expected to be the fastest growing segment in the alternative data market segmented by data type, at a CAGR of 54.9% during 2020-2025.
The alternative data market is also segmented by industry into automotive, BFSI, energy, industrial, IT and telecommunications, media and entertainment, real estate and construction, retail, transportation and logistics and other industries. The BSFI market was the largest segment of the alternative data market segmented by industry, accounting for 26.7% of the total in 2020. Going forward, the other media and entertainment segment is expected to be the fastest growing segment in the alternative data market segmented by industry, at a CAGR of 51.7% during 2020-2025.
North America was the largest region in the alternative data market, accounting for 41.0% of the total in 2020. It was followed by Asia-Pacific, and then the other regions. Going forward, the fastest-growing regions in the alternative data market will be Middle East and Western Europe where growth will be at CAGRs of 52.7% and 49.5% respectively. These will be followed by North America and Asia-Pacific, where the markets are expected to grow at CAGRs of 47.8% and 47.5% respectively.
The coronavirus pandemic has now spread worldwide causing major disruptions in global economies. Several industries are experiencing different challenges due to the effect of the pandemic. The impact of the pandemic on the alternative data sector has been potentially less than other markets, due to investors and businesses shifting towards the use of alternative data to try to assess the fluctuations in market conditions due to the pandemic. The use of web-based data, satellite images, geo-location data and credit card data are some examples that gained popularity as the pandemic spread. According to a survey by Alternative Investment Management Association and SS&C Technologies, in 2020 53% of the hedge fund industry used alternative data. Likewise, in 2020, as the COVID-19 spread across the world, many long and short hedge funds turned to non-traditional data to study the impact of shutdowns on industries such as restaurants, hotels, cruise lines and airlines.
The top opportunities in the alternative data market segmented by data type will arise in the Credit and debit card transactions segment, which will gain $2,060.4 million of global annual sales by 2025. The top opportunities in segment by industry will arise in the BSFI segment, which will gain $2,687.3 million of global annual sales by 2025.
Market-trend-based strategies for the alternative data market include integrating artificial intelligence (AI), establishing collaborations with research institutions and established companies, launching next-generation platforms and investing in edge computing solutions. Player-adopted strategies in the alternative data market include strategic partnerships and collaborations and development and launches of new solutions.
To take advantage of these opportunities, The Business Research Company recommends the alternative data companies to leverage artificial intelligence (AI), focus on edge computing, expand in emerging markets, focus on expanding through collaborations, subscription model based pricing, offer value-based pricing, provide freemium models, focus on strong PR strategy, leverage social media to maximize reach, focus on fast-growing end-use industries, offer services to startups, and increase partnerships with banks and fintech companies.
