2022 China Low-code Industry ReportSource:iResearch
September 08,20225:02 PMOverview
Low-code attaches more importance to the ability of agile development. Based on this, it develops toward more automatic and intelligent technology integration, changing from being driven by form and model to being driven by data. No-code attaches more importance to user experience and ease of use of products and keeps expanding products' high-level capabilities in terms of breadth and depth, making products easier to use and more functional.
Penetration of low code in application scenarios is influenced by product functions and application scenario complicity. Business scenarios of small and medium-sized enterprises usually have simple demand which is versatile. Low-code penetration started earlier, and application coverage is wider. With the accumulation of product technology and cognitive enhancement on the demand side, low-code application continuously spread from personalization scenarios of SMEs, innovation application scenarios of medium and large enterprises, and middle and long tail scenarios to core business systems of middle and large companies.
The low-code industry developed quickly from 2017 to 2020 but its growth rate has fallen. Due to enterprises‘ digital transformation and the Covid-19 pandemic, in 2021 the size of the low-code market hit 2.75 billion yuan, with a growth rate of 72.4%. It is expected that the CAGR in the next four years will reach 44.1%. The market size will be 11.84 billion yuan by 2025.
Trend 1: Application scenarios will extend, contributing to the penetration of the industrial Internet and accelerating the integration with real economy. Trend 2: Technology integration will speed up and integration with technology sector will deepen, expanding platform capabilities horizontally and deepen business interaction vertically. Trend 3: Aggregation platforms will break the zero-sum game, and aggregation ecology will drive the rise of the low- code industry.Low Code and Enterprise Digitalization
The ease of use of low-code reduces the time and money needed for enterprise digital transformation. Its process design link helps enterprises to further improve the business or organizational operation during the implementation enterprise operation mechanism. In the long run, the low-code platforms deeply combine enterprises’ demand with independent development to build sustainable and constantly adapting IT service abilities. However, enterprises need to maintain innovation momentum to be successful. Low-code tools can empower business personnel with development abilities and accelerate the implementation of innovative ideas, helping companies to find new business growth paths.
Low code and no-code are the two product forms of generalized low-code. They have different development paths. Low-code attaches more importance to agile development capabilities and has higher scalability and integration capabilities. With these advantages, it keeps developing towards a more automated and intelligent form of technology integration, thereby upgrading its capabilities from lightweight page analysis to processing complex reports and data, and changing from being driven by form and model to being driven by data. No-code attaches more importance to user experience and ease of use of products. On the premise of meeting customers' basic functional needs, it keeps increasing products' high-level capabilities in terms of breadth and depth so that the products will have more functions and become easier to use. In terms of breadth, frameworks can be developed based on basic components. In terms of depth, high-level capabilities such as organizational authority structure management and enterprise-level management backstage can be added to the basic no-code platform capabilities, enriching the no-code application scenarios in enterprise digital transformation.
New business models keep emerging in the low-code market. Low-code vendors used to focus on application development. Nowadays, with the rapid development of the low-code industry and the improvement of market awareness, the need for resource integration and product interconnection has become urgent. Thus, low-code aggregation platforms came into being. They are two-way trading platforms between vendors and customers by gathering other low-code vendors of application development.
Users of low-code development tools, which are much easier to use than traditional tools, are expanding from developers to business personnel. However, ordinary employees are not able to complete application construction independently. Technical personnel are still needed for communication between front-line business personnel and vendors. Low-code products need to be easier to use in the aspects of the underlying technical framework and presentation of the visual interface. Since enterprises fail to provide a comprehensive training mechanism after purchasing low-code products, low code is not well accepted by employees and the implementation is slow, which has a negative influence on the breadth of low-code application to some extent.
Solving the shortage of talents is the key to overcoming the difficulties in ease of use and the breadth of market demand. Without enough talents, the influence of low code in first-tier city markets and lower-tier markets will be very limited. Facing a huge market room that has not been penetrated, the integration of enterprises, universities, and research institutes might bring a new development path to the industry. With the integration, local governments and universities and low-code vendors cooperate with each other so that enterprises can promote research and research contributes to enterprises, helping regional talent development and fast implementation of low code.
The industrial Internet deeply integrates the new generation of Information and communication technology with the industrial economy and penetrates into real economy sectors such as transportation, logistics, and energy, accelerating the digital and intelligent transformation of the industry. From data collection, data analysis, to comprehensive data integration for application development, the application scenarios faced by the industrial Internet keep growing, and the types of penetrated vertical industries have been increasing. Massive projects caused by the quantitative change of demand types will curb vendors ' large-scale revenue generation in normal business modes, which will further hinder the penetration of the industrial Internet. Therefore, more and more low-code tools emerge in application development integration scenarios related to the industrial Internet. They are able to flexibly build personalized applications in a short term, which can quickly meet the diverse demands. They are also integrated with the original system, lift the development burden on the industrial Internet suppliers, and accelerate the integration with the real economy application scenarios through the industrial Internet.
Under the condition of minimizing costs, low-code platforms can access high-R&D-density technology functional sectors such as data development, AI, RPA, and IOT through APIs and other means to horizontally maximize platform capabilities. With the improvement of capabilities, products can provide high-level services such as connecting data silos, automating repetitive labor, and intelligent operation to deepen the integration of business scenarios, thereby increasing the application range and stickiness of products. Nowadays, AI and big data are driving the development of each other and their boundaries are gradually blurring. The interaction of technologies provides a better service experience and meets enterprises' urgent demand for intelligent data usage and agile decision-making in the era of VUCA. Low-code is going to further increase the call volume of data development, AI, RPA, and IOT-related subdivision capabilities, so as to develop more solutions for vertical business scenarios, and accelerate enterprises' comprehensive and in-depth digital transformation.
Table of Contents of the Full Report
1 Low-Code and Enterprise Digitalization
1.1 Enterprise Digitalization Development Process
1.2 Low-code and Enterprise Digitalization
1.3 Internal Development Drivers of the Low-code Industry
1.3.1 Development of the Supply Side
1.3.2 Development of the Demand Side
1.3.3 Personnel Structure
1.4 External Development Drivers of the Low-code Industry: Pandemic and Policy
1.5 The Impact of Low-Code on the Software Development Industry
2 Low-code Development Path
2.1 Product Development Path
2.2 Application Penetration Path
2.2.1 Model of Scenario Penetration Path
2.2.2 Industry Application Penetration Model
2.2.3 Overall View of Application Scenarios
2.3 Vendor Development Path
2.4 Map of Low-Code Vendors
3 Challenges facing the Low-code Industry and Suggestion
3.1 Challenge 1
3.2 Suggestion 1
3.3 Challenge 2
3.4 Suggestion 2
3.5 Challenge 3
3.6 Suggestion 3
4 Investment Logic of Low Code
4.1 Investment and Financing in China's Low-Code Market(1)
4.2 Investment and Financing in China's Low-Code Market(2)
4.3 Investment Due Diligence of Low-Code Vendors
4.3.1 Structure of Earnings
4.3.2 Turning Point of Earnings
4.3.3 Valuation Model
4.3.4 Market Room
4.4 Low Code Investment Recommendations
5 Case study
5.3 Huawei AppCube
5.4 Mingyuan Cloud
5.5 Micro Financial Times
5.7 Hontent Softwware
6 Overall Development Outlook of the Low-code Industry
6.1 Trend one: Extension of Application Scenarios
6.2 Trend two: Accelerated Technology Integration
6.3 Trend three: join of the Aggregation Platform
In the long run, the low-code platforms deeply combine enterprises’ demand with independent development to build sustainable and constantly adapting IT service abilities. However, enterprises need to maintain innovation to be successful. Low-code tools can empower business personnel with development abilities and accelerate the implementation of innovative ideas, helping companies to find new business growth paths.
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