Competitive market intelligence enables companies to develop strategies that provide them an edge over their competitors. It helps to gain insights on marketplace dynamics and understand the likely challenges that companies have to tackle given the ever-changing market scenario.
Competitive market intelligence provides the necessary inputs to understand the competitors’ supply chain and also analyze strategies adopted them to improve their market share. Reviewing competitor’s decisions on their product portfolio, price changes and policies provide the necessary impetus to take counter measures. Information sourced from competitor websites, social media channels or packaging can provide the relevant leads to take corrective action.
When used as a business tool, competitive market intelligence enhances the strategic decision-making process according to the market needs. However, it requires clarity on the current tactical measures and scope as laid down while starting a particular organizational initiative. This helps in realigning the priority areas and follow the leads provided by market intelligence.
Procurement teams should assess the performance of their current suppliers with that of their competitors’ and gauge the difference in results. This should help in revamping the supply chain or re-prioritize critical component sourcing based on supplier capabilities. Also, companies should perform intelligence reviews at key decision-making stages and create a transparent environment for the internal analysts to access crucial data to benchmark with external sources.
While the role of market intelligence in formulating strategies is important, a degree of caution needs to be taken regarding the sources used for gathering information. Reliability and relevance are primary aspects to be considered while sourcing the data. Partnering with established service providers could help in addressing these key aspects in the external market environment.
Competitive intelligence should be used for monitoring the following categories which are crucial to the decision-making process. Some of these are:
- Economic factors
- Legal and regulatory changes
- Technology and applications
- New market avenues
- Distribution channels
- Profiling target audience
- Studying buyer behavior
Each of these categories can influence decision-making process based on the scale and reach of businesses. As business requirements vary among industries, a combination of these categories may support their strategy formulation. Suppliers and distribution channels might be of interest to procurement professionals. For companies venturing into new markets, information on the number of competitors in that space, economic factors and buyer behavior may be crucial for their decision-making.
While market intelligence is data-driven, realizing its full potential lies in clubbing the data with competitor’s actions and strategies. This helps to understand their competitive advantage and the factors that contributed to their gaining market share. Companies can take a corrective course of action based on these inputs as it reveals their current stance and weak points.