Enterprise Software - Japan

Japan

In 2024, the Enterprise Software market in Japan is expected to generate revenue of €9.62bn.
Among the various software categories, Customer Relationship Management Software is projected to dominate the market with a volume of €2.94bn.
Looking ahead, the market is anticipated to grow at an annual rate of 4.78% (CAGR 2024-2029), resulting in a market volume of €12.15bn by 2029.
Furthermore, the average spend per employee in the Enterprise Software market in Japan is projected to reach €139.10 in 2024.
It is worth noting that in global comparison, United States is expected to generate the highest revenue of €139.60bn in the Enterprise Software market in 2024.
The demand for cloud-based enterprise software solutions is rapidly increasing in Japan, driven by the country's strong emphasis on technological innovation and efficiency.

Key regions: France, United Kingdom, Australia, Canada, South Korea

Definition:

The Enterprise Software market covers software applications designed to support essential business activities by large organizations such as enterprise resource planning, customer relationship management, business intelligence, and supply chain management.

Products in the Enterprise Software market can be obtained in two ways: as on-premises software that is sold via a transactional license or a subscription and as cloud-based software (software as a service/ SaaS) that is most frequently sold as a subscription.

Structure:

The Enterprise Software market contains eight markets that are based on the functionality of the software:

Business Intelligence Software refers to software applications that support organizations to analyze, visualize, and report data.
Content Management Software refers to a wide range of software applications that support organizations to manage their digital content such as documents, images, and videos.
Customer Relationship Management Software refers to software applications that support organizations to manage their interactions with customers, clients, and prospects.
eCommerce Software refers to a wide range of software applications that support organizations to manage their online sales channels.
Enterprise Performance Management Software refers to software solutions that help organizations to manage and improve their performance across various areas, such as finance, operations, and strategy.
Enterprise Resource Planning Software refers to software applications that support organizations to manage, integrate and optimize important business activities related to resources such as people, finance, capital, materials, and orders.
Supply Chain Management Software refers to software applications that support organizations to manage their supply chain activities such as inventory optimization, supplier and vendor management, and logistic operations.
AI Development Tool Software refers to a specialized category of software designed to facilitate the creation, testing, deployment, and management of artificial intelligence (AI) models and applications.
Other Enterprise Software refers to aggregated revenues for the types of enterprise software that are not specifically mentioned in the other Enterprise Software markets, such as Project Management Software, Product Life Cycle Management Software, and Production and Operation Software.

Additional Information:

The Enterprise Software market comprises revenue and revenue growth as the key performance indicators. Only revenues that are generated by primary vendors at the manufacturer price level either directly or through distribution channels (excluding value-added tax) are included, and revenues generated by resellers are excluded. Revenues are generated through both online and offline sales channels and include spending by enterprises (B2B) as well as governments (B2G). Detailed definitions of each market can be found on the respective page where the market data is displayed.

Key players in this market include SAP, Salesforce, Adobe, and Oracle.

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Analyst Opinion

The Enterprise Software market in Japan has been on a steady rise in recent years, driven by a combination of factors unique to the country.

Customer preferences: Japanese customers have a strong preference for software that is reliable, efficient and secure. This has led to a high demand for enterprise software that can integrate with existing systems, automate processes and ensure data security. Japanese companies are also known for their focus on quality, which means that they are willing to invest in software that can help them achieve their goals.

Trends in the market: One of the major trends in the Enterprise Software market in Japan is the adoption of cloud-based solutions. This trend has been driven by the need for flexible and scalable solutions that can keep up with the fast-paced business environment in Japan. Another trend is the increasing use of artificial intelligence (AI) and machine learning (ML) in enterprise software. Japanese companies are leveraging these technologies to automate processes, improve decision-making and enhance customer experiences.

Local special circumstances: Japan has a unique business culture that places a strong emphasis on relationships and trust. This has resulted in a preference for local vendors who can provide personalized support and services. Additionally, the Japanese language is complex and requires specialized software that can handle the nuances of the language. This has created a demand for locally developed software that can cater to the unique needs of Japanese businesses.

Underlying macroeconomic factors: Japan is the third-largest economy in the world and has a highly skilled workforce. The country has a strong focus on innovation and technology, which has led to the development of world-class enterprise software. Additionally, the government has been actively promoting the use of technology in business through initiatives such as the "Society 5.0" plan, which aims to create a super-smart society through the use of technology.In conclusion, the Enterprise Software market in Japan is growing rapidly, driven by a combination of customer preferences, local special circumstances and underlying macroeconomic factors. The adoption of cloud-based solutions and AI/ML technologies is expected to continue to drive growth in the market, while the unique business culture and language requirements will continue to create demand for locally developed software.

Methodology

Data coverage:

The data encompasses B2B, B2G, and B2C enterprises. Figures are based on the allocation to the country where the money was spent at manufacturer price level (excluding VAT).

Modeling approach / Market size:

The segment size is determined through a top-down approach. We use financial statements such as annual reports, quarterly earnings, and expert opinions to analyze the markets. To estimate the segment size for each country individually, we use relevant key market indicators and data from country-specific industry associations such as GDP, level of digitization, GDP sector composition, and observed level of software piracy.

Forecasts:

We use a variety of forecasting techniques, for instance, advanced statistical methods, depending on the behavior of the relevant segment. The main drivers are the GDP and the level of digitization.

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 is considered at a country-specific level.