The emotion analytics market stood at $164.7 million in 2018, and it is expected to reach $1,419.2 million by 2024, displaying a CAGR of 46.8% during the forecast period (2019–2024). This growth can be stimulated by factors, such as growing service sector, soaring demand for business intelligence and data analytics solutions, rising focus on customer satisfaction, and spurring demand for automobiles. Moreover, the advertising industry is generating high demand for emotion analytics solutions to analyze the feedback of customers on specific ads.

Apart from this, increasing incorporation of emotion analytics in the video gaming sector is fueling the market growth. Currently, industry players are largely integrating new solutions with emotion analytics software to understand emotions and behavior of game players. Such software helps the companies to analyze and understand real-time emotions that include facial expressions, reactions, behavior, and feelings, such as joy, fear, and anger, of users at every stage of the game. These features assist the companies to gain insights and develop new solutions and designs to meet customer expectations.

Get More Insights: Emotion Analytics Market Segmentation Analysis Report

Another factor driving the emotion analytics market is the augmenting demand for these solutions from the automobile sector. Automotive manufacturers are venturing into new-age technologies by implementing artificial intelligence (AI) technologies in their offerings. These manufacturers are focusing on research and development (R&D) activities to enable emotion recognition features in vehicles, wherein the software incorporated in cars respond intelligently to the emotions emoted by the driver. The software enables gesture, eye movement, and touch recognition, while detecting the alertness of the driver, thereby, reducing the incidence of road accidents.

The application segment of the emotion analytics market is categorized into customer experience management, sales and marketing management, public safety and law enforcement, workforce management, competitive intelligence, and others. Among these, the customer experience management category dominated the market in 2018. This is due to escalating market competition and altering customer expectations, and companies are engaged in new investments and initiatives to meet customers' needs. Application of emotion analytics helps the companies in understanding the feelings of consumers toward their offerings and assists them in upgrading their customer experience strategies.

Geographically, the North American emotion analytics market accounted for the largest share in 2018, due to the expansion of service sector, presence of several large-scale industries, continuous technological advancements, and high IT spending in the region. On the other hand, the Asia-Pacific (APAC) market is projected to witness the fastest growth during the forecast period. This can be ascribed to the enhancement of service industry in emerging nations, such as India and China; escalating number of contact centers; and rising digitization in the region.

Further, the emotion analytics market is characterized by the presence of numerous players that are adopting strategic measures, such as product launches, partnerships, geographical expansions, and mergers and acquisitions, to consolidate the competition. For example, Kairos AR Inc. introduced a state-of-the-art data visualization solution for offline retailers named 'Kairos Camera', in July 2019. The camera collects information regarding age, emotion, and gender of consumers and tracks their dwell time and new and returning consumer visits.

Thus, the growing focus of businesses toward enhancing customer experience will boost the demand for emotion analytics software in coming years.