Automation Testing Market to value $40 Billion by 2027

Adding to this, automation testing offers several benefits in IoT devices such as fast & continuous app testing, better test coverage, quick defect fixes, improves testing productivity, and elimination of hardware resource bottlenecks. This will further add new opportunities for automation testing providers in the market over the forecast timeline.

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The managed services segment held about 30% of the automation testing market share in 2020 and will grow at a 20% CAGR till 2027. The market growth is credited to increasing demand for managed services across product-based companies. Managed service providers help these enterprises to focus on their core businesses and deliver high-quality products with an optimum ROI & less time to market. Managed service providers are implementing Artificial Intelligence (AI), machine learning, and predictive analytics technologies in their managed services to stay competitive in the market. These players are also entering into long-term collaborations with their clients to increase revenue.

The embedded software segment held around 10% of the market share in 2020 and is projected to grow at 14.5% CAGR from 2021 to 2027. The embedded software segment growth is credited to the increasing uptake of embedded software in the industrial sector. The proliferation of smart factories and increasing uptake of Robot Process Automation (RPA) in the industrial sector will provide growth opportunities for the market during the forecast period. Equipment with embedded software work on real-time scenarios and require continuous testing, creating high market opportunities.

The Banking, Financial Services, and Insurance (BFSI) segment held a market share of around 15% in 2020 and is projected to grow at a 12.5% CAGR through 2027. Rising demand for reliable software in banking applications is poised to fuel the segment demand. The banking software offers various functions, such as deposit & transfer of funds, balance inquiry, and withdrawal, which require safeguard software systems with zero error detection, accelerating the demand for automation testing in the market. The increasing adoption of mobile wallets for connected banking systems and financial transactions in developing economies including India will further accelerate testing services demand in the banking sector.

The Europe automation testing market is anticipated to register a CAGR of 14.5% from 2021 to 2027. The market growth is attributed to the presence of major automotive OEMs, such as Volkswagen, Daimler AG, Audi, and BMW Group, which are highly emphasizing on the development in ADAS and electrification of vehicles. Europe is home to some of the largest software companies, such as SAP, Software AG, Eleks, and Avira Operations GmbH & Co. KG, contributing to the industry growth. The flourishing software industry in Germany will fuel the market growth.

Key players are highly focused on strategic mergers and acquisitions to cater to the competitive edge in the market.

Some major findings of the automation testing market report include:

• The increasing adoption of mobile-based software applications will propel the regression testing market growth. Several mobile apps such as e-commerce, online payment, entertainment & gaming require time-to-time upgrades to remove bugs and improve the user experience. This has resulted in the increasing demand for regression testing services across the mobile application ecosystem.
• Non-functional testing is expected to witness a high market share over the forecast timeframe. Increasing demand for performance testing and load testing services across software development lifecycles is expected to add opportunities for market growth over the forecast period.
• Parallel-execution features offered by the cloud endpoint interface will fuel the automation testing market growth. Cloud-based software testing reduces infrastructure costs and improves software testing scalability. Adding to this, the surging adoption of orchestration technology including CI/CD will spur the cloud-based segment growth.
• Rising demand for secured software services across the IT & telecom sector will bring new opportunities for automation testing providers. The IT & telecom sector is integrated with critical software suites including billing update systems and web-based platforms. These platforms are data sensitive and require end-to-end security testing, adding new opportunities for industry participants.
• The COVID-19 pandemic has positively impacted the automation testing market in early 2020. In the first half of 2020, several companies across the e-commerce, healthcare, and entertainment sectors started investing in digital platforms to maintain business continuity. This has created high growth opportunities for automation testing service providers during the pandemic.
• Asia Pacific is expected to witness high growth opportunities from 2021 to 2027. Growth is majorly credited to the increasing demand for outsourcing services across India, China, and Singapore. The presence of major outsourcing service providers, such as Tech Mahindra, TCS, and Accenture, in the region will support the market growth.
• North America is expected to witness the highest growth during the forecast period. The region has a strong presence of leading tech companies including Microsoft, Amazon, IBM & Apple that are continuously innovating and developing new products to increase their market penetration.

Key players operating in the automation testing market are Tricentis, Qualitest, Cognizant, Capgemini, Wipro Limited, Accenture, TCS, Micro Focus International plc, Microsoft Corporation, SmartBear Software, and Tech Mahindra Limited, among others. Companies are highly focused on strategic initiatives, such as acquisitions, partnerships, and collaborations, to achieve a competitive advantage over other players in the market