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Market intelligence is the information that a company collects about the market in which it currently operates or wants to operate. This information helps the company define its market segment, market penetration, and overall opportunity.
Marketing intelligence often includes competitor intelligence, which focuses on information about a company’s particular competitors. This can indicate current market share, pricing levels, and customer trends that will support leaders in making informed business decisions.
Keep in mind, any marketing intelligence definition will differ from business intelligence. Market intelligence provides an overall external view of the market where companies sell. However, business intelligence refers to internal data like productivity, company sales, processes, and similar information. Increasingly, market intelligence data and business intelligence are being combined to arm leaders with a more complete picture of their target market.
Organizations can gather market intelligence data from a variety of sources. Internal data, or data a company generates and maintains itself, can reveal sales trends and new customer behaviors. External data gathered from industry trade journals, articles, and websites that include distributor and vendor insights can also be valuable. Many organizations collect their own market intelligence by conducting market research surveys that are specific to their industry sector.
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For market intelligence to be effective, it needs to be specific to the organization. While internet searches are useful for gathering information, they may not provide enough specific information to help a company increase its market share or grow its revenue.
It is becoming increasingly essential for organizations to perform their own market intelligence research. This allows them to design their research so it provides specific data, which they can quickly act upon to improve their position in the market in which they operate.
There are six important advantages to performing market intelligence research that is tailored to your organization.
To increase revenue, organizations are constantly on the lookout for new market opportunities—whether that means entering an entirely new market or expanding their presence in an existing market.
Performing surveys and research is key to understanding your market opportunities. This may involve researching the current potential in a specific market and how much demand there is for the product. Distributors and vendors can provide data on the best ways to get products to market, while industry experts can provide their views on current trends.
Surveys and market research will uncover who your competitors are, how they have remained successful, and how they may react to a new company coming onto the scene. This competitive intelligence is important for any growing company, particularly if its leaders want to make data-driven decisions regarding entering a new market.
As Harvard professor Michael Porter explained, companies face particular barriers to entry with a new marketplace.
Competitor research into each of these barriers can help you understand and address the potential problems of entering a new market before you launch a new product.
Making a bad decision is expensive. That’s why organizations need as much information as possible about their market before they invest in a new product or service, or before they spend time improving an existing product. Marketing intelligence provides data to business leaders to help them make better decisions about where and how to use their resources.
To minimize risks involved with new markets or products, it’s important to collect competitor research on who is in the market and how they sell to customers. Companies may also use product intelligence data as part of their market intelligence research. This involves analyzing large databases of product transaction data to look for trends that will improve the customer experience and lead to greater brand loyalty.
The electronics industry, for example, is known for using product intelligence data. Product managers focus on getting automatic data about the product’s quality and testing data so they can quickly improve products and get new products to market.
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What happens if you’re already a leader in your industry? How do you maintain that prime position?
That’s where a specific study focused on your competitors will help. You can perform a competitive marketing intelligence study to stay ahead of your competition and keep up with market trends. You will want to understand not only where your competitors stand today, but what their business plans are for the future.
Depending on what you want to achieve, your competitor research may include:
Industry experts, former employees, distributors and customers, financial reports, and other sources are often used to gather competitor intelligence and keep a leg up on the competition.
Giving the customer what they want, when they want it, at the price they want it, helps to increase sales.
Organizations are constantly surveying their clients and customers to find out what their problems are and how they can solve them. Creative ideas for new products and services are born from the need to solve customer problems.
Customer surveys are a great way to understand customer behavior, and panel studies monitor behavior over time to identify trends and opportunities. If your goal is to expand your market share, you will need to identify who the customers are in a specific market segment and what they need to solve existing or emerging problems.
Companies need to create a distinctive identity in the marketplace, one that customers know and trust. To achieve this, they can perform market intelligence research that helps them position their company and their brand in the market.
Surveys that focus on brand positioning are a great way to understand what unique characteristics set one company and its brand apart from competitors. Similarly, corporate positioning studies that are specific to an organization’s target market will help provide intelligence on how customers view a particular brand.
Each company should have its own brand positioning statement, and studying competitors' brand positioning statements will provide insight into how they reach their target market. Your competitors’ brand positioning statement should reveal their:
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Market segmentation refers to dividing your target market into smaller, specific groups. When companies use market research to identify specific market segments, they can tailor their marketing and businesses decisions accordingly.
For instance, say a fast food restaurant’s target market is 18 to 34-year-old males who eat out at least 12 times a month. That business may design and market its menu, hours of operation, and products with this market segment in mind.
Once an organization divides its market into segments with specific needs and tastes, it can create unique products for that segment that differentiate it from its competitors. Gaining market intelligence about target segments is critical to successful marketing and selling.
Market intelligence helps companies focus on serving the needs of their target market and develop a deeper understanding of competitors and the business environment.
Structuring a market intelligence research program will help you collect current data that leads to better decisions, increased market share, and improved brand positioning.
Start with the end in mind. What do you want to accomplish with your market intelligence research? There are many advantages to this type of research, but to make the most of your project you need to clarify its scope.
For example, your goal could be to conduct different studies that evaluate new or existing products and markets. These studies usually focus on a combination of the following:
Your research goal will help you determine what resources and methodology you will use to collect data.
Once you have defined the scope of your study, you can determine which metrics should be used to evaluate the results. Metrics will vary by organization depending on the goal of its research.
Metrics that can be used to evaluate your research include:
For instance, if you are selling a new type of shaving cream for U.S. males ages 18-35, you might want to have the following metrics for your study:
You will save time and effort by deciding what statistics are important to your study before you start your project. It will help focus your efforts on which data is important to your study.
Your project ROI is another important metric. Most companies have a budget for each research project. They want to know that they will get a return on their market intelligence research programs. Internet research and online surveys are excellent ways to get the metrics you need and achieve a positive ROI for your project.
Depending on your budget, there are several ways to gather market intelligence data.
Online research will give you access to trade journals, industry experts, customer reviews and more. Some research portals require a fee, especially to gather competitive intelligence like annual sales, number of customers, and company profitability.
Online surveys are a cost-effective way to gather customer information for insights into brand positioning, market assessments, and product concept testing.
Product intelligence and data analytics can provide insights and trends from actual consumer purchases from large databases. Both are growing in popularity when it comes to market research, however they are generally an additional expense.
Expert consultants from market intelligence forms are often brought in to guide companies through multi-million dollar product launches. They can provide detailed insights, data, and guidance—at a cost.
Your research goal, desired metrics, and budget will determine how much data you can collect for your research.
Competitor intelligence, market intelligence, online research, and customer surveys will provide an immense amount of data. The next step involves turning that data into useful information that your organization can use to make decisions. How can you manage it all?