Announcing the results from the 2024 People Analytics Tech Market report
Stacia Sherman Garr
HR Industry Analyst. I help Fortune 500 leaders understand and act on what's happening today and what's coming in the near future.
Earlier this week, we released our fifth annual report on the state of the People Analytics Tech market. The full report is available to our RedThread Research professional and above members. Sign up here to get your membership to read the full report.
Below is the press release, which features many of the key findings.
RedThread Study Reveals an $8.1B People Analytics Technology Market—Though Growth Has Slowed Amidst Lower Customer NPS and Increased Scrutiny of Lofty AI Promises?
WOODSIDE, Calif., September 11, 2024 /PRWEB/?— RedThread Research today unveiled its 2024 report,?People Analytics Technology: State of the Market, revealing that while the People Analytics Technology (PAT) market has reached $8.1 billion in size, its year-over-year growth has slowed to 36%, a marked decrease from 50% in the previous year. Coupled with this slowdown, the report shows a continued decline in Net Promoter Score? (NPS). Customers that gave higher NPS and renewal likelihood had vendors that ensured a high return on investment and strong support services.?
“The market for People Analytics Tech continues to expand, but growth is slowing," said Stacia Garr, RedThread's co-founder and principal report analyst. “Declining NPS means it’s critical for vendors to address issues around support and return on investment, as those two factors are predictive of subscription renewal likelihood. Many organizations are heavily promoting their AI offerings, but that is not driving renewals or perceptions of value. Many customers don’t yet see the impact of AI or understand what problems it is solving.”
Key findings from the report include:
领英推荐
ROI and Customer Support the Key to Customer Renewal
The PAT report makes it clear that showing return on investment (ROI) and delivering on customer support are critical to subscription renewal. Vendors who prioritize helping their customers achieve measurable ROI, providing better customer support, and setting realistic expectations for AI capabilities are more likely to maintain customer satisfaction and increase renewal rates.
Customers who experience high ROI from their PAT solutions were 2.94 times more likely to promote their vendor and 1.6 times more likely to renew their subscription, according to the research. Moreover, those who perceive strong support were 1.7 times more likely to renew.
Big AI Promises, But Small AI Impact – For the Moment The report emphasizes that while AI has been a key selling point for many vendors, the reality has not yet lived up to the marketing hype.?
"Nine out of ten vendors say they have Gen AI or ML capabilities, yet fewer than half of their customers agree,” said Priyanka Mehrotra , Senior Analyst at RedThread Research. “Given this, it is unsurprising that the presence of AI is not a strong driver of renewals yet. Our interviews revealed that vendors need to work on connecting AI offerings to real business problems critical to customers before it will be seen as a critical factor in whether a customer renews or not."?
Rise in Data Transparency a Bright Spot This Year
One of the more positive developments highlighted in the report is vendors' growing focus on enabling data transparency. Around 80% of vendors are enabling customers to be more transparent about how people’s data is used, a significant improvement from previous years. This trend is particularly strong among European vendors, with 100% reporting that they enable transparency, compared to about three-quarters of North American vendors. This focus on transparency is helping to build trust in the PAT market and improve customer satisfaction in some segments, the report observes.
Research Sponsored by Expanding RedThread Tech Consortium?? This research report was sponsored by the RedThread Research Tech Consortium, a growing community that remains focused on underwriting high-quality, unbiased market research. Consortium member organizations collaborate with RedThread to push the boundaries of people analytics technology and contribute to cutting-edge research. Current Tech Consortium members include:
Dad & Husband | Skills Architect| Learning Tech| AI in Learning| Brand Builder & StoryTeller| Data Curious| Energy Man
2 个月Mazzarine Studer
GM EX | Board Advisor | Chair Indigenous Committee
2 个月Very insightful Stacia Sherman Garr ; this stat most interesting from the findings “90% of vendors claim to offer AI, but only 40% of customers believe those capabilities deliver.” What I’ve found is the HR tech & analytics vendor who double down on ongoing consulting & advisory services to work with HR leaders and People Analytics practitioners, tend to create better buyer advocates than the ones who just focus on implementation support and licence fees! Iman E. Dr Philip Gibbs
People Analytics and Strategy @ GoodRx
2 个月Very insightful analysis. The people analytics vendor market is ever-expanding and this is a good insight into the broad themes in this niche area.
CEO Ingentis Holding GmbH | Organizational Effectiveness Through HR Tech, Analytics & Org Design | Building future-ready Organizations | #CEJoe
2 个月Very, very interesting, Stacia!??
HR Industry Analyst. I help Fortune 500 leaders understand and act on what's happening today and what's coming in the near future.
2 个月Thank you to the RedThread Tech Consortium who make our high-quality, unbiased research possible: Absorb Software Augmentir Betterworks Bongo Claro Analytics Cornerstone OnDemand Culture Amp Degreed Docebo Eightfold LearnUpon Lightcast LinkedIn Medallia Microsoft One Model OpenSesame Perceptyx Qualtrics QuestionPro retrain.ai Revelio Labs Salary.com SeekOut TechWolf Top Employers Institute tribute UKG Visier Inc. Workday Workera ZeroedIn Technologies