When is Market Intelligence used?
MI is often used when a company is seeking to enter a new market, or expand into an existing market.
A simple 2×2 matrix offers a helpful visual aid:
Depending upon which of the four cells are checked, the direction and requirements of the process should fall into place.
How is Market Intelligence conducted?
MI should always start with a clear set of objectives followed by a set of questions whose answers will guide users to take appropriate actions. Questions should ideally be asked only if one has already thoughtfully considered how each answer will inform a decision.
Here is an example of objectives and sample questions.
- Are there any unmet needs in the market?
- Do alternative products/services exist?
- Is the market national or global in scope?
- What is the current size of the market?
- What is the estimated growth of the market?
- What, if any, cross-marketing opportunities are there?
- What can derail your goals?
- What is new that might impact success?
- Current and potential competitors
- Who are they/who might they be?
- New suppliers or distributors
- Is there a need for alternative sources?
- Who and where are they?
- Will they be the same, or include new prospects?
- What price points are or will be acceptable?
- Entry and penetration strategies
- What will they be, and how differ from current ones?
Market Intelligence Approaches
Once objectives have been clarified and agreed upon, a plan may be mapped out to best combine information gathering tools with a method for integrating and analyzing the findings.
- Secondary Research involving readily available public sources such as news articles, press releases, financial statements, and even employment or real estate postings can provide a useful starting point with an overview of the market, trends, key companies and individuals.
- Social media and Big Data are gaining popularity as additional sources of information that may be incorporated into an overall market analysis, although it may be a challenge to determine how to extract meaning from them.
- Conferences and Trade Shows also offer fertile ground for quickly gaining insights into a market, competitors, customer needs and trends.
- Business Intelligence (BI), Competitive Intelligence (CI), and Market Research (MR) often overlap and may be used concurrently with MI in order to gain a fuller picture of the market, its major players/competition, and potential customers.
- Business intelligence tends to involve internally collected data, e.g. sales, production, budgets, while CI focuses externally, on specific competitors, and MR on customers and the environment of the market.
Managing Market Intelligence
Keeping track of all the information included in market intelligence can become time-consuming and overwhelming.
- Having a set of priorities combined with rules or filters can organize and reduce the overload of information and make it more manageable.
- Software and online tools exist to help you gather, analyze andstore your market intelligence, it is often worth outsourcing certain tasks to a third-party firm that can handle all of these requirements and provide unbiased feedback regarding optimal actions to take.
- Several outside firms provide, and allow you to oversee, a mix of MR, BI, CI and MI tools and thus can be useful in the gathering as well as the analysis of information.
- In addition, such experienced companies can backstop you to be sure you and your colleagues have thought of all the important areas of information that you need as well as a framework for integrating it.
- Having a high quality and quantity of information is not enough. Skillful analysis is important to transform it into intelligence that forms the foundation of optimal decisions.