Encoders Market SWOT and PEST Analysis 2021-2031
The encoders market size is projected to reach US$ 6.03 billion by 2031 from US$ 2.70 billion in 2023. The market is expected to register a CAGR of 10.6% in 2023–2031. The growing miniaturization of electronics has resulted in the creation of lightweight, compact encoders that are simple to integrate into applications with limited space is likely to remain a key encoders market trends.
Encoders Market Analysis
The encoders market is growing at a rapid pace due to the expanding applications for encoders and favorable government initiatives for smart city projects. The market is expanding steadily, driven by the expanding automotive industry and increasing demand for electric vehicles. Moreover, the technological advancements and development of modern encoders, growing demand for high-end automation by industries, and rising adoption of AI & ML technologies are providing lucrative opportunities for market growth.
Encoders Market Overview
An encoder is a device used to change data formats for compression, standardization, speed, secrecy, and security. It is manufactured using durable materials, including steel, aluminum, and heavy-duty plastic. Numerous industries, including robotics, cars, medical equipment, industrial automation, telecommunications gear, elevators, digital cameras, and renewable energy systems, are highly using encoders for maintaining accuracy, precise position control, increasing operating efficiency, enhancing safety, enabling feedback for error correction, and providing high-speed operation. These benefits provided by encoders to numerous industries are driving the market during the forecast period.
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Encoders Market: Strategic Insights
Market Size Value in US$ 1,748.4 Million in 2020 Market Size Value by US$ 3,447.7 Million by 2027 Growth rate CAGR of 10.2% from 2020-2027 Forecast Period 2020-2027 Base Year 2020
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Encoders Market: Strategic Insights
| Market Size Value in | US$ 1,748.4 Million in 2020 |
| Market Size Value by | US$ 3,447.7 Million by 2027 |
| Growth rate | CAGR of 10.2% from 2020-2027 |
| Forecast Period | 2020-2027 |
| Base Year | 2020 |
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Encoders Market Drivers and Opportunities
Expanding Applications for Encoders is Driving the Market
Increasing usage of encoders in a range of applications in various industries is driving the market during the forecast. Encoders are employed in the automotive industry for precise control and safety in electric power steering, anti-lock brake systems, and powertrain systems. Furthermore, the broad use of the product to guarantee accuracy and dependability in a variety of medical devices, such as surgical robots and medical imaging systems, is driving the market. The market is driven by the increasing use of encoders in consumer electronics products, including digital cameras and printers. Additionally, the growing usage of encoders in solar tracking systems and wind turbines to ensure optimal energy harvesting is boosting the market. The aircraft industry is also increasing its use of encoders for flight controls, engine control systems, and other crucial applications. However, increased application for encoders is fueling the market during the forecast period.
Technological Advancements and Development of Modern Encoders - An Opportunity in the Encoders Market
Technological advancement and the development of modern encoders are creating opportunities in the market. Modern encoders allow sophisticated technologies to provide high precision, dependability, and efficiency in a range of applications. Accordingly, recent breakthroughs in sensor technology encourage the development of modern encoders that provide high resolution and accuracy for precise control in industrial automation, robotics, and other sectors, which are positively influencing the market growth. Furthermore, the introduction of optical and magnetic encoder technologies, which provide better performance in a variety of demanding applications, is boosting the market. Additionally, the integration of advanced communication protocols in encoders for improving their adaptability and interoperability in increasingly networked industrial environments is generating significant growth opportunities for the market.
Encoders Market Report Segmentation Analysis
Key segments that contributed to the derivation of the encoders market analysis are type, technology, and end user.
- Based on type, the encoders market is divided into linear encoder and rotatory encoder. The rotatory encoder segment held a larger market share in 2023.
- On the basis of technology, the encoders market is divided into optical, magnetic, and others. The magnetic segment held a larger market share in 2023.
- In terms of end user, the encoders market is categorized as aerospace, automotive, food and beverages, printing, consumer electronics, medical, and others. The consumer electronics segment held a larger market share in 2023.
Encoders Market Share Analysis by Geography
The geographic scope of the encoders market report is mainly divided into five regions: North America, Asia Pacific, Europe, Middle East & Africa, and South America/South & Central America.
In terms of revenue, the Asia Pacific market accounted for the largest encoders market share, owing to the expanding automotive, consumer electronics, manufacturing, and other industries. Technological advancements and increasing adoption of sophisticated electronics, robotics, and automation features are driving the market. These products heavily relied on encoders to precisely work and operate. In addition, the increasing investments in developing smart cities, utilities, and transportation increase the demand for encoders for effective management and operation is propelling the market.
Encoders Market Report Scope
Encoders Market News and Recent Developments
The encoders market is evaluated by gathering qualitative and quantitative data post primary and secondary research, which includes important corporate publications, association data, and databases. The following is a list of developments in the market for encoders and strategies:
- In June 2023, Bourns, Inc., Bourns, Inc., released the PEC11J series encoder as a drop-in replacement for the discontinued ALPS Model EC11J Series. This modified configuration of the Bourns PEC11S series should enable customers to continue to support existing applications with no changes to their mechanical or electrical layouts. Testing is recommended to ensure compatibility with each customer's specific application. Samples are available upon request for testing. (Source: Bourns, Inc., Press Release, 2023)
Encoders Market Report Coverage and Deliverables
The “Encoders Market Size and Forecast (2021–2031)” report provides a detailed analysis of the market covering below areas:
- Market size and forecast at global, regional, and country levels for all the key market segments covered under the scope
- Market dynamics such as drivers, restraints, and key opportunities
- Key future trends
- Detailed PEST/Porter’s Five Forces and SWOT analysis
- Global and regional market analysis covering key market trends, major players, regulations, and recent market developments
- Industry landscape and competition analysis covering market concentration, heat map analysis, prominent players, and recent developments
- Detailed company profiles
Report Coverage
Revenue forecast, Company Analysis, Industry landscape, Growth factors, and Trends
Segment Covered
Type; Technology; End User
Regional Scope
North America, Europe, Asia Pacific, Middle East & Africa, South & Central America
Country Scope
Argentina, Australia, Brazil, Canada, China, France, Germany, India, Italy, Japan, Mexico, Russian Federation, Saudi Arabia, South Africa, South Korea, United Arab Emirates, United Kingdom, United States
Frequently Asked Questions
The incremental growth expected to be recorded for the global encoders market during the forecast period is US$ 3.33 billion.
The global encoders market is expected to reach US$ 6.03 billion by 2031.
The key players holding majority shares in the global encoders market are Delta Electronics, Inc., Dahua Technology Co., Ltd, Omron Corporation, ELCO Holding, and FRABA B.V.
The growing miniaturization of electronics has resulted in the creation of lightweight, compact encoders that are simple to integrate into applications with limited space to play a significant role in the global encoders market in the coming years.
The expanding applications for encoders and favorable government initiatives for smart city projects are the major factors that propel the global encoders market.
The global encoders market was estimated to be US$ 2.70 billion in 2023 and is expected to grow at a CAGR of 10.6% during the forecast period 2023 - 2031.
The Insight Partners performs research in 4 major stages: Data Collection & Secondary Research, Primary Research, Data Analysis and Data Triangulation & Final Review.
- Data Collection and Secondary Research:
As a market research and consulting firm operating from a decade, we have published many reports and advised several clients across the globe. First step for any study will start with an assessment of currently available data and insights from existing reports. Further, historical and current market information is collected from Investor Presentations, Annual Reports, SEC Filings, etc., and other information related to company’s performance and market positioning are gathered from Paid Databases (Factiva, Hoovers, and Reuters) and various other publications available in public domain.
Several associations trade associates, technical forums, institutes, societies and organizations are accessed to gain technical as well as market related insights through their publications such as research papers, blogs and press releases related to the studies are referred to get cues about the market. Further, white papers, journals, magazines, and other news articles published in the last 3 years are scrutinized and analyzed to understand the current market trends.
- Primary Research:
The primarily interview analysis comprise of data obtained from industry participants interview and answers to survey questions gathered by in-house primary team.
For primary research, interviews are conducted with industry experts/CEOs/Marketing Managers/Sales Managers/VPs/Subject Matter Experts from both demand and supply side to get a 360-degree view of the market. The primary team conducts several interviews based on the complexity of the markets to understand the various market trends and dynamics which makes research more credible and precise.
A typical research interview fulfils the following functions:
- Provides first-hand information on the market size, market trends, growth trends, competitive landscape, and outlook
- Validates and strengthens in-house secondary research findings
- Develops the analysis team’s expertise and market understanding
Primary research involves email interactions and telephone interviews for each market, category, segment, and sub-segment across geographies. The participants who typically take part in such a process include, but are not limited to:
- Industry participants: VPs, business development managers, market intelligence managers and national sales managers
- Outside experts: Valuation experts, research analysts and key opinion leaders specializing in the electronics and semiconductor industry.
Below is the breakup of our primary respondents by company, designation, and region:
Once we receive the confirmation from primary research sources or primary respondents, we finalize the base year market estimation and forecast the data as per the macroeconomic and microeconomic factors assessed during data collection.
- Data Analysis:
Once data is validated through both secondary as well as primary respondents, we finalize the market estimations by hypothesis formulation and factor analysis at regional and country level.
- 3.1 Macro-Economic Factor Analysis:
We analyse macroeconomic indicators such the gross domestic product (GDP), increase in the demand for goods and services across industries, technological advancement, regional economic growth, governmental policies, the influence of COVID-19, PEST analysis, and other aspects. This analysis aids in setting benchmarks for various nations/regions and approximating market splits. Additionally, the general trend of the aforementioned components aid in determining the market's development possibilities.
- 3.2 Country Level Data:
Various factors that are especially aligned to the country are taken into account to determine the market size for a certain area and country, including the presence of vendors, such as headquarters and offices, the country's GDP, demand patterns, and industry growth. To comprehend the market dynamics for the nation, a number of growth variables, inhibitors, application areas, and current market trends are researched. The aforementioned elements aid in determining the country's overall market's growth potential.
- 3.3 Company Profile:
The “Table of Contents” is formulated by listing and analyzing more than 25 - 30 companies operating in the market ecosystem across geographies. However, we profile only 10 companies as a standard practice in our syndicate reports. These 10 companies comprise leading, emerging, and regional players. Nonetheless, our analysis is not restricted to the 10 listed companies, we also analyze other companies present in the market to develop a holistic view and understand the prevailing trends. The “Company Profiles” section in the report covers key facts, business description, products & services, financial information, SWOT analysis, and key developments. The financial information presented is extracted from the annual reports and official documents of the publicly listed companies. Upon collecting the information for the sections of respective companies, we verify them via various primary sources and then compile the data in respective company profiles. The company level information helps us in deriving the base number as well as in forecasting the market size.
- 3.4 Developing Base Number:
Aggregation of sales statistics (2020-2022) and macro-economic factor, and other secondary and primary research insights are utilized to arrive at base number and related market shares for 2022. The data gaps are identified in this step and relevant market data is analyzed, collected from paid primary interviews or databases. On finalizing the base year market size, forecasts are developed on the basis of macro-economic, industry and market growth factors and company level analysis.
- Data Triangulation and Final Review:
The market findings and base year market size calculations are validated from supply as well as demand side. Demand side validations are based on macro-economic factor analysis and benchmarks for respective regions and countries. In case of supply side validations, revenues of major companies are estimated (in case not available) based on industry benchmark, approximate number of employees, product portfolio, and primary interviews revenues are gathered. Further revenue from target product/service segment is assessed to avoid overshooting of market statistics. In case of heavy deviations between supply and demand side values, all thes steps are repeated to achieve synchronization.
We follow an iterative model, wherein we share our research findings with Subject Matter Experts (SME’s) and Key Opinion Leaders (KOLs) until consensus view of the market is not formulated – this model negates any drastic deviation in the opinions of experts. Only validated and universally acceptable research findings are quoted in our reports.
We have important check points that we use to validate our research findings – which we call – data triangulation, where we validate the information, we generate from secondary sources with primary interviews and then we re-validate with our internal data bases and Subject matter experts. This comprehensive model enables us to deliver high quality, reliable data in shortest possible time.
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