DIGITAL PRODUCT PASSPORT SOFTWARE MARKET SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2024 - 2031)

Digital Product Passport Software Market Size and Trends

The digital product passport software market is estimated to be valued at USD 189.2 Million in 2024 and is expected to reach USD 991.8 Million by 2031, exhibiting a compound annual growth rate (CAGR) of 26.7% from 2024 to 2031.

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The market is expected to witness significant growth during the forecast period. The growth can be attributed to the rising adoption of Industry 4.0 and increasing focus of manufacturers on the digital transformation of supply chain and production processes. Digital product passports help track individual products throughout their lifecycle. They enable traceability by providing access to authenticated records and documentation. These passports also offer relevant attributes to both manufacturing organizations and consumers. With digitization becoming a global trend across industries, digital product passports are expected to play a key role in enabling transparency and building customer trust. Manufacturers are actively pursuing digital strategies to gain competitive advantage and optimize efficiency through real-time decision making based on data and analytics. This rising digital adoption and the need to ensure sustainability and ethics in supply chains will drive the continued demand for digital product passport software.

Greater Traceability Needs across Industries

As supply chains become more global and complex, industries are under increasing pressure to ensure product integrity and quality throughout the manufacturing and distribution process. A lack of visibility into critical details like component sourcing, manufacturing standards, testing, and certification can expose vulnerabilities. In some industries such as pharmaceuticals, medical devices, and aerospace, poor traceability can have serious safety consequences and even lead to recalls. The digital product passport software aims to address this by providing a shared, immutable record of a product's journey. By capturing each stage and transaction on a Blockchain-enabled platform, manufacturers gain immutable proof of compliance. Regulators can also more easily audit processes. For consumers, it builds confidence that the product adheres to the expected quality norms. The need for greater transparency and accountability is driving many industries to explore digital solutions to digitally trace products end-to-end.

For instance, in February 2021, iTrazo a traceability solutions provider and PSQR a track and trace software provider, collaborated to provide a global digital traceability solution for various industries, addressing the increasing demand for transparency and accountability in supply chains, particularly within the food sector.

Supporting Sustainable and Circular Business Models

Beyond compliance, digital passports also allow organizations to develop innovative new business models centered around sustainability and the circular economy. By having comprehensive historic data on a product's materials, components, location and usage, companies can optimize design for disassembly and reuse. Manufacturers may offer refurbishment services or takeback programs, reintegrating parts or materials back into their supply chains. Digital passports also enable new rental, reuse, and resale models where ownership changes but the product’s identity and story persists digitally. For consumers, they help make more informed choices about what to buy, lease or dispose based on a product’s remaining useful life and potential for upgrading/recycling. Various initiatives by governments, industries as well as conscious consumers are placing immense pressure on brands to demonstrate sustainability commitments. Digital passports can demonstrate concrete actions towards minimizing environmental impacts and closing resource loops over a product’s entire lifecycle.

For instance, In January 2022, iPoint Systems GmbH a provider of software and consulting for environmental and social product compliance, and sustainability. and BASF a chemical producer partnered to establish a standardized approach for calculating product carbon footprints (PCFs) in the chemical industry. This partnership aligns with the European Green Deal and Circular Economy Action Plan, facilitating transparent product carbon footprint reporting to support sustainability goals through Digital Product Passports (DPPs).