Prompt Engineering Market Size, Share & Trends Analysis Report By Component (Software, Services), By Technique (n-Shot, Generated Knowledge), By Application, By Industry, By Region, And Segment Forecasts, 2024 - 2030

Prompt Engineering Market Growth & Trends

The global prompt engineering market size is anticipated to reach USD 2.06 billion by 2030, registering a CAGR of 32.8% from 2024 to 2030, according to a new report by Grand View Research, Inc. The market growth is propelled by factors such as the growing adoption of advanced technologies such as generative Artificial Intelligence (AI) among industries. Prompts are used to elicit responses from AI models, such as ChatGPT, Bard, and Large Language Model Meta AI (LLaMA). Prompt engineering is the process of developing and fine-tuning prompts to maximize the ability of AI models to understand user inputs, helping them provide informative, accurate, and relevant responses.

Prompt engineering offers numerous benefits, such as AI model performance improvements, reduced harmful and biased responses, better user experience, and better predictability and control. Well-crafted prompts can guide the AI model to focus on specific task aspects, reducing the chances of offensive or inappropriate responses. Similarly, by guiding the model with well-crafted prompts foe generating desired results, the model’s responses can become more predictable and consistent. These advantages have resulted in the growing demand for prompt engineers, leading to higher adoption of prompt engineering software solutions, such as Integrated Development Environment (IDE) and prompts available on marketplaces. These software tools offer better prompt management and are generally available on a subscription pricing model.

The growing investments in AI technologies are likely to offer significant growth opportunities for the market. According to the U.S. Department of Commerce’s International Trade Administration, global AI funding reached USD 66.8 Billion in 2021, and 65 companies operating in AI reached valuations of over USD 1 Billion. According to AIPRM, a U.S.-based prompt marketplace, the U.S. government invested around USD 328 billion between 2019 and 2023. Similarly, governments of countries such as Singapore, China, Canada, and India are also investing heavily in AI. Advancements in the field of AI research can lead to greater demand for prompt engineering to optimize AI models.

Prompt Engineering Market Report Highlights

• Based on components, the software segment is expected to register the fastest CAGR during the forecast period. The segment’s growth is attributed to the high level of innovation with new companies offering prompt engineering software solutions
• Based on technique, the n-shot prompting segment dominated the market in 2023; the segment’s growth is driven by the ability of this technique to generate responses from the AI model quickly without providing much information
• Based on industry, the BFSI segment is expected to register the fastest CAGR over the forecast period, driven by the growing adoption of advanced technologies such as AI and Machine Learning (ML) by BFSI businesses
• North America dominated the market in 2023, driven by high investments by the U.S. and Canadian governments in AI. Moreover, the presence of numerous AI startups and market players are driving market growth in the region

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