iMonitor IT (Brazil IT market survey)
Quarterly Survey Report - October 2020
The market will grow 9.5% in 2020 and 10% in 2021
The finding comes from the research that ADVANCE does quarterly to identify the perception of IT entrepreneurs with the market moment. In the survey conducted in October 2020, IT entrepreneurs were positively surprised by the 2020 results and optimistic about the market in 2021.
The first quarter of 2020 recorded a growth of 7.5% over the same period a year earlier. The crisis began on March 24, impacting the entire market. The second quarter pointed to weak growth of 5.1%, but historically the second quarter is the weakest of the year, so the crisis hit the IT market in a less relevant quarter.
The third quarter recorded an EXUBERANT 10.3% growth, taking the jan-set cumulative to 8.2% and the forecast to end the year with 9.5% growth, against an expectation of growth of 20% before the crisis.
Not all companies have been impacted in the same way. The survey shows that 65% of the companies had growth in the accumulated Jan-Set 2020, but on the other hand we had 25% of the companies with retraction. For the fourth quarter of this year the expectation is to have 11% of companies with growth above 30%; 16% of companies with growth between 15% and 29%; and 19% of retraction companies.
Companies with high growth rates are companies that analyze the market (opportunities and threats), design or redesign a business model to meet demand in a differentiated way, correctly choose a portfolio of offers, establish a plan with strategies and actions, structure the areas of marketing and sales, have GREAT discipline in the execution of the plan, constantly think about INNOVATION, and have SPEED to plan, execute, learn, adjust the plan and move on to a new execution cycle.
The initial growth forecast for 2021 is 10%, but it will be a "very complex" year.
On the one hand we will have negative impact factors. It will be the first year in office of the mayors, who assume discovering a much smaller cash than expected. Historically it is a year with strictly essential investments and public visibility, and a year with less IT investments in the municipal sphere. It will be the third year of the president and governors. Historically it's the year of unpopular stocks - which makes entrepreneurs unsure about making IT investments. And finally, there is the possibility of a second wave of pandemic at the beginning of the year.
On the other hand we have positive impact factors. It will be the third year in office for the president and governors, and historically it is the year that federal and state governments increase investments in infrastructure and IT. COVID showed the importance of technology for the survival and growth of companies. Digital transformation projects will continue at an accelerated pace, especially in the areas of Telecom, Health, Education and Retail. We will have an even greater increase in investor interest in the Brazilian IT market (investments, venture capital and M&A). And finally, we expect GDP growth by 3% to 4% which, if it really happens, could pull it growth to 12% to 15%.
IT companies offering CLOUD solutions will continue to grow high and we'll see the EXUBERAnt growth of companies that call themselves PaaS, including API brokerage platforms, financial services platforms, and low-code development platforms.
To succeed in a "very complex" year you must start, NOW, to study the market and assemble your plan with strategies and scenarios. January 4th will be the day to start executing your plan - at high speed!
CEO - ADVANCE Consulting
About our surveys
ADVANCE does a quarterly survey to identify BRAZILIAN IT market growth, trends and opportunities. We interview a large number of IT entrepreneurs to understand business strategies and challenges. We have been doing this research since 2008 and the historical data allows us to establish trending algorithms, helping us to establish sharp predictions.
Topics that are addressed in this quarterly survey:
Financial results of IT companies in the last 2 years
Investments made in employee slated, marketing and sales
Expectations for the growth of the economy and IT market for the next 3 years
Main strategies adopted by IT companies
Planned investments in staff, marketing and sales
Internal and external variables that are taking it entrepreneurs' sleep away
Characteristics of IT companies with high growth rate