Market intelligence is defined as the information or data that is derived by an organization from the market it operates in or wants to operate in, to help determine market segmentation, market penetration, market opportunity, and existing market metrics. Market intelligence is a vital aspect to understand the state of the market, as well as helps collect competitor intelligence which in turn aids towards becoming profitable.
For example, A company wants to understand who is the right target audience for a mobile phone they are launching soon. A profile survey can help the company to shortlist its target audience based on the type of mobile device they are launching. For instance, if the colors of the phone are bold and its features are set in a manner to market it as a gaming mobile device, a survey will shortlist participants who prefer gaming, are in a younger age group and people who fall in a specific income range. Such information helps the company to focus its efforts on the right people thus saving costs and efforts.
Market intelligence, however, is not the same as business intelligence. Whilst business intelligence focuses on mostly internal factors such as billing rates, headcount, processes etc., market intelligence gathers data externally providing you a holistic view of the entire market and not just your organization. However, incorporating market intelligence with business intelligence processes will enable a company to have a holistic view of the ongoing corporate performance in specific market conditions.
Market intelligence is closely associated with market research and can be explained in three simple parts as follows:
Competitor Intelligence – Competitor intelligence can be explained as the collection of data about your competitor using ethical methods such as government databases and public records. For example, Japanese automotive companies were able to capture the US markets and even dominate them using competitor intelligence. Understanding the need for high quality, fuel-efficient cars led them to strategize and penetrate the US market successfully.
Product Intelligence – Product intelligence is gathering data related to competitor products or similar products in the market. For example, A telecommunications company needs to monitor the prices of competitive mobile phones in the same segment. A price drop in the competitor product can mean the company is introducing a new model in the market. Understanding such information can enable a company to strategically launch their models at the right time and price.
Market understanding – Market understanding is knowing the market share of your company, trends in the market, the size of the market and which is your target market. Understanding the demand in the market, and customer wants can help a company tremendously to increase their revenues and market share. For example, A comprehensive market research can give valuable insights to a brand, for instance, the target market is age 20-40, upper-middle-class family and the trend in the market is for Crossfit training to get fit and healthy. A particular gym can use this information and provide services specific to this requirement enabling them to penetrate the market much faster than the usual gyms.
Some basic data collection methodologies for Market intelligence are as follows:
Survey research involves a set of questions put together in a concise manner to gather data from the target market and analyze the same to create valuable market intelligence. The larger the group of people, the more reliable are the results. There are various methods in which surveys can be conducted depending on what information needs to be collected.
Online Surveys – These are the best and one of the most economical methods to get data in a swift manner. Such surveys have been associated with unreliable data, but with newer tools coming into the market, this method has become very popular and reliable, to get real-time data fast. Furthermore, the majority of the target audience already prefers online communication, hence online surveys are the best method to gather market intelligence. For example, A mobile company wants to understand the competitor’s position in the market to launch its own product in the same segment. A competitor analysis survey can be conducted to understand the competitor’s position in the market, their product features, and their market share. Such information will enable the company to decide the right audience, the features, and the correct pricing to capture higher market share.
In-Person Surveys – These surveys are one to one interviews which can be conducted in high traffic locations such as malls to gather required information. This also allows you to gather customer feedback as you have the advantage of showcasing a product or comparing products and gather valuable information. Such a method has high response rates, however, it is quite expensive as a skilled person is needed at every location with an appropriate device such as a tablet which tends to be costly. For example, A FMCG company wants to launch a new product in the market for women. In-person surveys can be conducted in malls to understand the trend for particular cosmetic products and preference of its target audience. Accordingly, the product can be modified and launched in the market to have a direct impact on the demand of the audience.
Telephone Surveys – These surveys are comparatively less expensive as compared to in-person surveys but are costlier than mail surveys. Although, a number of companies use telemarketing and hence the consumer does not respond well due to constant badgering. Therefore, it gets very difficult to convince the consumer to take the survey, thus reducing response rates, as well as the quality of responses. For example, businesses need to understand public opinion about specific products, for instance – laptops. A telephone survey can be conducted with a set of questions that include product features, brand preference, price comfort, and many more, which can help the company to launch the right kind of product in the market.
Mail Surveys – These are one of the cheapest ways to conduct surveys, especially to a larger audience. Since the advancement in technology, people have stopped reading paper mails nowadays and hence the response rates for such a method is only 3-15%. However, in areas where technology is still inaccessible, such method is still dominant to gather required information from the audience.
Information is different from intelligence. Information is not useful until it has some meaning to it. Information is nothing but knowledge about a particular topic or product, while intelligence is about meaningful information which can be used to take action. In order to transform collected data to meaningful intelligence, analysis has to be performed on the collected data. There are various market intelligence software in the market. Such software not only allows you to collect data but also analyze the data using advanced analytical methods. Analyzing the information collected helps you transform it to valuable market intelligence thus enabling a company to understand target market opinions, trends, competition and where improvements or modifications are needed. Advanced analytical techniques such as Conjoint analysis, Maxdiff analysis, Gap analysis, Trend analysis, Text and Sentiment analysis allow a company to understand the market accurately which aid them to make strategic business decisions.
For example, it is important for a company to monitor the market on an ongoing basis. By analyzing and monitoring the trends, measuring customer satisfaction scores and Net promoter scores, a company can stay competitive and manage to increase the market shares, its revenues and also retain its customers. If needed, accordingly decisions can be taken to change or modify the product on the basis of the current trends or the situation.
Reports and Presentation
Reports and presentation are an important step in using market intelligence. Reports and visual infographics will enable a company to understand the markets in an easier manner and can answer questions like what do the metrics mean? Wrong interpretation of such data can be hazardous for the company, hence this step plays a vital role in the market intelligence process. The entire market intelligence process has now become much easier using reliable and powerful market intelligence software. Thus using market intelligence effectively can enable a company to penetrate a market successfully and effectively, determine market segmentation, understand the competition and understand the market as a whole.
Market intelligence not only helps companies to distinguish their brand from its competitors but also helps in providing valuable information to stay in the game and excel at it. Following are some of the benefits that market intelligence provides.
Market intelligence is vital to the success of any organization, being the foundation on which all marketing is based. Effective use of market intelligence involves the collection of data, analysis and end use of the information. Market intelligence helps you to become customer-centric, understand the market demands and consumer opinions, collect real-time relevant data, boost your upselling opportunities, reduce risks, capture higher market shares and gives you a competitive advantage. These benefits are crucial to the success of any business and hence market intelligence is one of the most crucial elements in executing effective plans for the prosperity of any business.
Following are a few points, to understand why market intelligence is crucial to any business.
To understand your position in the market – Collecting market intelligence through surveys allows you to understand the market in-depth. It will give you insights into what the competitors are doing, what is the market demand and who will be your target audience and many more. Analyzing this information will enable a company to evaluate its position in the market and make strategies accordingly.
To evaluate your product – Conducting marketing intelligence surveys will give you actionable insights on the product trends in the market, the demand for specific features and product specification currently in demand. Such information helps you to evaluate your product and make wise business decisions accordingly.
To know your target audience – Gathering market intelligence will allow a company to understand the needs of the audience and using surveys, businesses can shortlist their target audience for specific products/services.
To conduct competitor analysis – Market intelligence is a vast field. Conducting surveys to gather intelligence about your competitors is vital in today’s business environment. Using such information, businesses can modify their products as per the need, understand competitors failures or successes, and devise strategies based on the competitor’s position.