European spending on digital transformation (DX) is forecast to increase at 15.9 percent to exceed $550 billion in 2023, according to International Data Corporation (IDC).
Digital transformation spending in Europe will grow in double digits till 2026, with a CAGR of 16.6 percent for 2021–2026, IDC said in the latest Worldwide Digital Transformation Spending Guide.
Digital transformation spending in Europe will be driven by investments in discrete manufacturing, professional services, and process manufacturing. Together, these industries will account for over a third of total European digital transformation spending in 2023.
Sustainability will be a key strategic priority that will boost European digital spending. Spending on sustainability is expected to grow by 23.8 percent CAGR to 2026 in Europe, driven by strong regulation, stakeholders’ increasing expectations, and initiatives to cut costs due to the energy price hikes brought on by the Russia-Ukraine War.
“Companies recognize the business benefits of a digital-first strategy, with sustainability gaining center stage, especially across European companies operating in the manufacturing, transport, and utilities industries,” said Angela Vacca, senior research manager, Customer Insights & Analysis, IDC.
European spending on sustainability-related use cases — such as environmental resource optimization / resource management and representation, tracking and reporting of CO2 emissions — will more than double between 2022 and 2026. Investments will be led by Germany, the U.K., and France.
