In the Video Analytics Market, Retail, Manufacturing, and Government Remain Ideal Target Verticals Given High Camera Counts and Common Object Detection Use Cases

Video surveillance companies across the industry are attempting to recast video surveillance cameras as business intelligence tools, hoping to expand the devices’ Serviceable Addressable Market (SAM) and create new revenue streams from untapped assets. These companies understand that video cameras could be as vital to a company’s marketing, operations, and logistical teams as their security units are if marketed correctly and applied with the required analytics capabilities.

An integral part of this expansion will be verticalization. As highlighted in a recent ABI Insight, the companies with the most success in turning legacy video surveillance customers (like parking garages) into adopters of advanced, operational video analytics have been those that offer packaged solutions directly fitted for vertical-specific concerns.

The verticals that are most ripe for video surveillance transformation typically have one or two key characteristics, or both: an already-existing, large video surveillance camera installed base or cross-vertical needs that lend themselves well to video analytics capabilities, such as common objects or behaviors that need to be categorized and routinely detected. Three specific verticals meet these criteria and serve as important opportunities for video analytics companies.

1) Retail

Retail has the highest number of cameras of any vertical, accounting for 20% of the total video surveillance camera installed base in the United States in 2025. And though retailers, like the rest of the video surveillance market, have lagged behind in video analytics adoption, they continue to be vital targets for video companies, given their existing hardware and certain industry-specific concerns following the COVID-19 pandemic.

The pandemic disrupted retailers on two fronts. It caused a dramatic dip in in-store shopping and a sharp increase in shoplifting that continues to linger. According to industry groups, retailers saw a 93% increase in the average number of shoplifting incidents per year in 2023 compared to 2019. In this post-pandemic era, retailers are more likely to invest in technologies that can gather data on customer behavior to get people back in stores, and spend money to improve their security infrastructure. This dual opportunity is perfect for video analytics companies as they position cameras as both security and operational tools.

For in-store customer data collection, video analytics cameras are often considered the “ultimate sensor,” gathering data on customer movements in a store, where they congregate, and how many enter at a certain time. This information is vital as retailers improve or redesign stores for the post-pandemic future. For example, intelligent video cameras have been instrumental in the design and functioning of Amazon’s advanced, cashier-less “grab-and-go” stores.

Video analytics also improve the traditional security benefits of video cameras. Video analytics tracking workflows that allow cameras to track discrete vehicles or persons through different camera frames help retailers identify suspicious persons inside or outside a property. Facial recognition databases and cameras help retailers share and recognize the profiles of common shoplifters before they enter aisles and steal products. Several use cases can merge both security and operational data to create an even more comprehensive account of customer interactions and, again, forestall shoplifting. For example, retailers can set up a video camera at a checkout stall and integrate it with their Point of Sale (POS) system, so if the POS detects an abnormal sale, users can corroborate the scene with footage.

2) Manufacturing

Although the video surveillance camera installed base in manufacturing is smaller than in retail, the industry is highly focused on safety, particularly if the manufacturer handles hazardous or heavy industrial material. This intense focus on safety poses an opportunity for new video analytics companies. Several video analytics companies sell products that enable a camera to detect if a worker is wearing Personal Protective Equipment (PPE) like safety vests, protective eye goggles, or hard hats. These types of equipment are common among many different types of manufacturers, meaning that a video analytics company could create a range of PPE detection products and be able to market them to a vast array of manufacturers, from pharmaceutical to agriculture plants. Manufacturers have both regulatory and safety motivations to monitor their workers and have proven that they are willing to purchase new technologies like video analytics to remain in compliance. To quote one video surveillance industry insider, “There is always budget for safety projects in manufacturing.”

3) Federal Government

The federal government has a large video surveillance camera installed base, second only to retail. Though many video experts view government as a slow-moving industry with bureaucratic obstacles, this large installed base and the sensitive nature of federal government make this an important market for video analytics adoption.

The federal government in the United States places a premium on its security infrastructure, which is why this industry previously invested in surveillance cameras at a faster clip than other verticals. This points to a willingness to adopt new technologies if there is a clear sense that the security technology could further improve the security of sensitive government sites. And though many video analytics companies are trying to move away from their reputation as “security-first” vendors, the federal government could be a reliable customer for more advanced, security video analytics workflows. ABI Research expects the federal government to invest in facial recognition cameras, as well as object tracking workflows. The federal government is also more likely than other, less sensitive verticals to adopt advanced object detection products like weapons detection.

These three verticals are ideal targets for video analytics companies because they have large camera installed bases or common objects or behaviors across the industry that could be easily categorized by cameras for better safety or operational insights. There are, of course, industries that meet either of these two criteria but are hindered by specific privacy concerns that affect video analytics' success in these markets.

Hospitals, for example, have a notable video camera installed base and several opportunities for advanced operational video analytics workflows, including using intelligent cameras to monitor patients’ well-being by detecting if they have fallen or are under duress. However, strict privacy regulations like the Health Insurance Portability and Accountability Act (HIPAA) would likely inhibit such use cases and make even advanced security use cases like facial recognition a harder sell in this industry.

Like government buildings, schools are hyper-concerned with security, particularly in the United States, given the scourge of school shootings. Privacy and budget concerns, however, can forestall an overhaul of an education system’s video surveillance infrastructure. For this reason, despite myriad safety concerns and a relatively high installed base, schools remain a fairly difficult market for video analytics companies. Schools that are interested in video analytics are most likely to upgrade their parking lot-facing cameras with basic analytics like License Plate Recognition (LPR), or sometimes weapons detection systems.