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Where is the greatest potential expected and how can it be realized?

PwC study: Global Business Ecosystems 2030 – Market Size and Potential

Your expert for questions

Axel Deniz

Axel Deniz
Leader Open Innovation Strategy at PwC Germany
Tel: +49 151 53341766
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Understanding ecosystems and their potentials in a better way

The increasing complexity of the business world confronts companies with numerous new problems that they often cannot solve on their own. To be successful now and in the future, companies must cooperate and participate in business ecosystems. This cooperation can lead to significant competitive advantages for the companies themselves as well as benefits for customers. Nevertheless, the strategic alignment within the ecosystem landscape remains a challenge for many companies and is characterized by great uncertainties.

Complementing qualitative research findings, PwC Germany has now collaborated with Strategy&, the Digital Business University of Applied Sciences (DBU), and Prof. Dr. Julian Kawohl of Ecosystemizer to develop an approach to quantify market sizes and thus the relevance of ecosystems in Western Europe, in the NAFTA region, and on a global level.

“Quantifying the business potential of ecosystems is the critical piece of the puzzle for data-driven, informed ecosystem and growth strategy decision making.”

Florian Nöll, Head of Corporate Development & Innovation at PwC Germany

The most important tool of the framework: the Ecosystem Strategy Map

The human as the starting point for the entire value creation in the corporate ecosystem

The convergence and merging of traditional industries into cross-industry ecosystems currently observed in the markets requires a new conceptual framework to illustrate and explain these changes: Kawohl and Krechting (2020) have proposed a new tool to represent economic order for this purpose, based on research and interviews with more than 1,000 strategy specialists and the observation of mega trends. At its core is the belief that there is a paradigm shift – away from B2B and B2C business models to an ecosystem-to-human (E2H) perspective. Accordingly, all value creation in enterprise ecosystems must derive from human needs. Therefore, the main tool of the framework is the Ecosystem Strategy Map, which puts people at the center. All offerings in ecosystems can be classified into ten life areas, which comprehensively represent human needs.

Finding the right scope for ecosystem activities by knowing the Ecosystem Domains

The Ecosystem Strategy Map additionally incorporates 15 Ecosystem Domains across all Life Areas, providing a second means to structure products and services. They are based on current technology and mega trends, along with recent developments among major ecosystem companies.The ecosystem domains are divided into eleven converging domains that comprise a range of life domains and four Super Domains that incorporate all life domains across roles.

The era of business ecosystems has begun

The time of traditional industries is about to pass. They are being replaced by business ecosystems. Once such a system is established, individual companies generally have no chance. For the vast majority of companies, therefore, only one decision remains: become part of the ecosystem – in the role that best suits their own capabilities.

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How to leverage the Ecosystem Strategy Map and study insights?

The results of the study offer executives and managers a clear guide to successfully navigate the increasingly complex business landscape in the future. They can take six simple steps to determine the ideal strategic position of their companies and their ecosystems within the Life Areas and Ecosystem Domains:

  1. First, an ecosystem mentality must be established within the company as well as investments made in the area of change management.
  2. This makes it possible to broaden the focus and remove all existing boundaries.
  3. The next step is to conduct a thorough analysis of the company's own resources and capabilities to determine its current position on the Ecosystem Strategy Map.
  4. Next, they must define their desired future target position using the insights gained in this quantitative work.
  5. Following that, strategy execution begins with finding the right partners beyond traditional industry boundaries to deliver greater value to all customers and other stakeholders.
  6. In the final step, all threads come together and the strategy is put into practice.

Key results of the study at a glance

Life Area market sizes

Measured in terms of the total share of value added, living, consumption, health, mobility, and work are retrospectively the largest Life Areas worldwide in 2019. The ranking of the largest Life Areas will remain stable. By 2030, all but three Life Areas will increase their share of total value added. The exceptions are Recreation and Entertainment, which will decline slightly, and Mobility, which will suffer a significant loss.

Life Area growth rates

From a global perspective, the Life Area Health (78.8 %) provides the greatest long-term growth opportunity until 2030, followed by Living (78.3 %), and Work (77.9 %). Conversely, the loss of shares in terms of total value added by Recreation, Entertainment, and Mobility is also reflected in their growth rates. These three Life Areas have comparably the lowest growth rates and bring up the rear in the rankings. Mobility (69.3 %) in particular is growing remarkably less than all other Life Areas.

Ecosystem Domain market sizes

Regardless of region, the Super Domain Infrastructure offers the greatest market potential until 2030. From a global perspective, the Ecosystem Domains Customised and Fast Demand Fulfilment and Personal Wealth and Legal follow.

In Europe and the NAFTA region, however, the Ecosystem Domain Customised and Fast Demand Fulfilment is not among the top three Ecosystem Domains. In both regions, Holistic Well-being is expected to have the greatest market potential in 2030, as it had in 2019.

Ecosystem Domain growth rates

Looking ahead to 2030, it can be seen that the Super Domain B2B Services ( 84.5 %) is expected to grow the fastest globally (78.9 %) alongside the Ecosystem Domains Personal Wealth and Legal (83.7 %) and Holistic Well-being. Globally, although one of the largest Ecosystem Domains, Customised and Fast Demand Fulfilment has a comparatively low growth rate (75.1 %), ranking only 8th. Seamless Mobility has the lowest growth potential, with a growth rate of just 63.2 %.

“The disruptive upheaval and digital transformation require companies to change – away from the traditional industry-focused logic towards business ecosystems. These offer entirely new opportunities for innovation and value creation through cross-industry partnerships.”

Andreas Späne,Partner at Strategy& Germany

Methodology

We have taken available growth forecasts for industries defined by the UN ISIC classification and applied them to the Life Areas of the Ecosystem Strategy Map. The data are presented geographically as global forecasts and also as localized forecasts for NAFTA and Europe, including historical data calculations for 2019 (the latest data collected) and forecast data for 2025 and 2030. The remapping of UN data to our chosen Life Areas was based on objective proxy data that should provide a clear classification. Where this was not possible, reclassification was based on categorical, qualitative expert judgment. The final results were quality assured in three independent validation rounds with experts.

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Florian Nöll

Florian Nöll

Head of Corporate Development & Innovation, PwC Germany

Tel: +49 30 2636-4176

Andreas Späne

Andreas Späne

Partner, PwC Strategy&, PwC Germany

Tel: +49 69 97167-408

Axel Deniz

Axel Deniz

Leader Open Innovation Strategy, PwC Germany

Tel: +49 151 53341766

Alexander Rösch

Alexander Rösch

Lead Ecosystem Strategy Consulting, PwC Germany

Tel: +49 173 7067401

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