The Low-Code Market - Fractured, Fragmented and Full of Promise

If you look into the most recent analyst reports about the low-code development market, there’s no room for doubt that the industry is on the rise. In its latest report, Gartner, for example, states low-code application platforms will be responsible for more than 65 percent of all app dev activity by 2024. In the same way, Forrester expects the low-code market to represent $21B in spending by 2022. 

This is all great news for the low-code market.

Unfortunately, hot tech attracts a wide variety of providers and posers, so it’s no surprise that things got a little confusing. In fact, while more low-code platform choices might sound appealing, a closer look reveals that many products are a far cry from what most enterprises need. Think of the electric car—there's the Kid Trax Cool Car 12V and then there's the Tesla.

Clarifying the Low-Code Market Size

The first analyst firm to name the market back in 2014, Forrester defines low-code platforms as "platforms that enable rapid delivery of business applications with a minimum of hand-coding and minimal upfront investment in setup, training, and deployment."

This year’s Forrester report is interesting in that, while it includes two more vendors than the last two previous reports (13 now instead of 11), Forrester acknowledges that the low-code market size, in their view, is starting to tighten, with some previous vendors now moving into a separate classification that includes process automation vendors.

So while the low-code market appears to be growing, it’s also become more specific, allowing Forrester to better classify vendors based on core capabilities rather than “also-ran” functionality.

We’ve also seen something similar with Gartner. In 2019, the analyst firm replaced its Magic Quadrant for Enterprise High-Productivity Application Platform as a Service with the Magic Quadrant for Enterprise Low-Code Application Platforms (LCAP), lightening the requirement for each vendor to be a cloud PaaS vendor, but also tightening the inclusion requirements.

In fact, this year’s technical requirements included:

1. Demonstrating a go-to-market strategy for its LCAP for cross-industry application development
2. Providing a minimal set of application platform capabilities
3. Providing for rapid application development
4. Providing an enterprise-grade LCAP, aimed at enterprise-class projects

We fully expect to see additional changes in 2020 as Gartner continues to focus in on what bundles of features and functionality customers can expect from a low-code application platform that can address the entire spectrum of use-cases for the enterprise.

An Alternative Perspective on the Low-Code Market

If you’re considering a low-code platform to modernize aging legacy systems, replace hundreds (or thousands) of Lotus Notes apps, or create new digital customer experiences that include mobile, chat and bots, it may help to understand the low-code landscape based on the heritage of the platforms in it.

Let’s take a look at three categories of low-code platforms and their purpose for existence.

Niche

These vendors’ platforms are focused on a specific app-dev challenge. For example: a better way to capture and store data, simpler way to define business processes or an easier way to create a mobile front-end.

These platforms focus almost exclusively on a single business need. They include business process management (BPM), case management, and no-code technologies. You can use them to create simple applications really fast, but with little scalability. 

Ecosystem

This category’s players are typically large software applications whose motivation for calling themselves low-code is to provide a path for creating greater value within their primary ecosystems (Salesforce Lightning, Amazon, Microsoft, and Google). Because these solutions were developed to solve a specific business need aside from general application development (e.g., database applications, web tools, etc.), they are at heart, niche platforms.

Purpose-Built

These are platforms architected from the very beginning to address custom application development using a low-code approach. Vendors in this category tend to keep up with the latest market needs and incorporate new features to future-proof their customers. They focus on supporting the widest range of use cases so organizations can achieve true digital transformation across their business.

These solutions are focused on delivering fit-for-purpose apps, while at the same time ensuring a consistent user experience across web, mobile, wearables, conversational and immersive touchpoints. This is where OutSystems lives.

Discover the leading Multiexperience Development Platforms 

Why Purpose-Built Is Important

The problem with niche players and those focused on their own ecosystem is that, inevitably, a time comes when the solutions built with the platform (i.e., core systems, business apps, etc.) need to evolve in a direction the platform does not support. It’s like if you needed your content management system to start offering point-of-sale functionality, complete with ordering menus and payments. Maybe you could add some plugins and get something that works, if not elegantly. But, what happens the next time you need something out of the box? Or the time after that?

At this point, organizations with these niche or ecosystem platforms are forced either to layer on another tool to plug the gap or resort to coding by hand and attempt to integrate the newly coded systems with existing systems. Very quickly, the benefits of niche and ecosystem low-code market players are lost.

We see this frequently. Many of our customers came to OutSystems after having hit this wall with another platform—and it can happen very quickly. The reasons are varied, but we hear things like:

“Yes, our current platform supports online mobile app development… but we need it to create apps that work offline too. It doesn’t do that.”

And…

“We are not able to integrate with our identity management system.”

Question: Why can’t more solutions get organizations over this wall effectively?

Answer: Because it’s hard to build a low-code development platform that meets the actual needs of customers. It takes time, not flash-in-the-pan tactics, to make sure that IT teams never hit a wall.

The Problem Low-Code Platforms Should Be Solving

Almost every day we hear about organizations that are victims of digital disruption - cue the retail (Sears, Toys”R”Us), Mobile Device (Blackberry), and taxi industry references. To avoid this, not only do business and IT strategies need to be in lockstep, but IT must be able to deliver solutions at the speed business demands. Imagine if the business minds behind Uber were told there would be a two-year wait for their mobile app.

The speed of development is the biggest opportunity for low-code platforms. Instead, all too often, IT is constrained on the following fronts:

• Too much work in the backlog
• Too much of the budget is dedicated to keep-the-lights-on maintenance
• In-house resource skills are not aligned with the IT projects
• Modern systems are amazingly complex to develop and by the time most are built, they are already out of date

The Real Value of Low-code

Addressing these problems requires a low-code development platform that can enable developers and others to:

• Visually model all layers of an application: user interfaces for any device, integration, data models, business logic, and workflow and able to extend any layer of an application with custom code.
• Handle complex mobile requirements like ultra-responsive user experience, offline data, on-device business logic, and sensor integration,
• Security and scale to support high-volume, business-critical applications.
• Manage the full application lifecycle and modern dev-ops practices.

Low-code platforms that are able to deliver these capabilities have a much greater impact on the business. They enable companies to launch digital solutions to capture new markets and captivate customers. And, they help resource-constrained teams get more done - empowering developers and business teams to collaborate and innovate.

As Gartner predicts - 65% of all applications will be delivered with low-code platforms in the next few years.

So, as the low-code market becomes red-hot, there will be a time of market confusion and chaos - where vendors vie for mindshare and buyers are bombarded with buzzwords. But, like any hot tech market, there is hype and there are results.

As you think about the future of your business - consider the results from companies driving real innovation and business value with low-code:

• Liberty Insurance drove a 274% increase in policy sales and delivered 83 new apps with their low-code center of excellence.more
• Ricoh replaced legacy systems, achieving a 253% ROI and a payback in just 7 months.more
• The City of Oakland transformed city services for residents and saved over $1 Million.more
• Schneider Electric launched 60 apps in 20 months, saving 650 days of development effort. more