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CLM Market Continues Red Hot Growth
The global demand for contract lifecycle management (CLM) solutions is estimated to increase at a compounded annual growth rate of 14% over the next 5 years. If accurate, the total spend for CLM will more than double by 2024.
- In 2018, organizations worldwide spent approximately US$1.1 billion on CLM.
- By 2024, that number could increase to US$2.4 billion.
(These numbers are from a synopsis of the report “Contract Lifecycle Management Software Market: Global Industry Trends, Share, Size, Growth, Opportunity and Forecast 2019-2024.”)
Much of this growth is being fueled by organizations in the public, manufacturing, healthcare, and financial services sectors. However, this is not the only source of the spending surge. Customers in all industries are facing increased regulatory scrutiny related to their contracting processes; combine that with customers that want to manage the contract lifecycle more effectively and you have a recipe for unabated growth in the CLM market space.
Key players in the industry will continue to jockey for position as the revenue pie expands. In addition, new players will enter the market outright or through acquisitions (e.g. DocuSign’s acquisition of SpringCM in 2018); some will be enticed by the revenue opportunities, while others will be attracted by the low costs/low barriers to entry.
Initially, there will be more options available to organizations. Current vendors and new vendors will provide a variety of solutions by 2024 to meet the technical requirements and budget requirements for customers at all points on the purchasing spectrum. Segmentation will continue to evolve as the vendors find their niche: large, medium, or small clients.
Over time, look for a decrease in the number of vendors in each segment: 1) through consolidation as the industry leaders try to establish dominance in a crowded field, protect their turf, and eliminate the competition; and 2) as undercapitalized startups fail to gain sustainable traction and are eliminated from the marketplace.
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