From Intelligence to Insight
Competitive intelligence can take many forms, from reviewing a company’s earnings call to analyzing their leadership’s strengths and weaknesses. Put simply by the Product Marketing Alliance, competitive intelligence is the practice of gathering and analyzing information relating to an organization’s competitors and using these insights to create a competitive advantage. This tactic helps businesses to understand their competitive landscape and the opportunities and threats that might be present, from spotting gaps in the market, improving products and services, identifying marketing tactics, meeting product demand and pricing programs to supporting the sales team.
The Product Marketing Alliance notes, in its essay on the subject of competitive intelligence, that a number of strategy questions should be raised during this process:
- What is your competitor’s strategy, and more importantly, how can you apply your findings to enhance strategic planning, and make smarter business decisions that’ll appeal to your target audience?
- What have they already done to effect that strategy that’s visible in product announcements, social media channels, webinars, press releases, marketing messages, acquisitions, statements, etc.?
- Where might they head next if they were continuing that strategy, and how might I get ahead of it?
- Which actionable insights can I transfer to the internal marketing team to improve business strategy?
This emphasis on competitive intelligence—and it should be stated this practice should be through ethical means—can eventually lead to what is termed competitive insights. This is often viewed as an overlooked step up from competitive intelligence. In an article from MIT’s Sloan School of Management, “How to use competitive insight,” by Kara Baskin, professor and author John Horn notes that “competitive insight is about taking competitors seriously so you’re never caught off guard by their actions.” Horn, whose new book is called “Inside the Competitor’s Mindset: How to Predict Their Next Move and Position Yourself for Success,” believes that business leaders tend to dismiss their competitors’ actions as irrational at their peril. When they fail to take competitors seriously, they’re caught off guard and unable to act or react effectively.
Horn, MIT notes, describes competitive insight as a four-part process for turning data into action. The first part is standard competitive intelligence: reviewing annual reports, listening to a competitor’s earnings call etc. Once the data is in place, the second part involves understanding what tools a competitor will leverage to make strategic choices with that data: assets, facilities, supply chains, distribution setups, government relations, and more. Third, it’s important to understand how decision-makers are likely to behave by examining their past. Not all leaders are the same: A CEO with a marketing background will make very different choices than one with a supply-chain history. Finally, companies should make short-term predictions about how a competitor might act and quickly change course if they turn out to be wrong.
Building Foresight Culture
In addition to competitive intelligence, All Things Insights’ building a foresight culture focused on the future as a critical tool for today’s enterprises to compete. It is also much like building a foundation for insights. It takes collaboration and communication as well as thoughtful and organized planning. Whether you view it as visioning, strategic foresights, future studies, or predictive modeling, the insights team with their research and data analytical skills is at the forefront of this capacity.
Fueling Valuable Insights
Competitive intelligence plays a crucial role in fueling insights by providing valuable information and knowledge about the competitive landscape, market dynamics, and industry trends. Companies can gain deeper insights into their competitors’ strategies, strengths, weaknesses, and customer perceptions. We asked ChatGPT how competitive intelligence can fuel insights at a company:
- Understanding Competitor Strategies: Competitive intelligence helps companies gain a comprehensive understanding of their competitors’ strategies. By analyzing competitor actions, product launches, marketing campaigns, and pricing strategies, companies can identify areas where competitors are gaining a competitive advantage. This insight can inform strategic decision-making and help companies develop counter-strategies to stay competitive.
- Identifying Market Trends and Opportunities: Through competitive intelligence, companies can monitor industry trends and emerging market opportunities. By staying abreast of market developments, new technologies, and changing customer preferences, companies can identify opportunities to innovate, diversify, or expand into new markets.
- Recognizing Customer Perceptions and Expectations: Competitive intelligence can reveal valuable insights into how customers perceive and interact with competitors’ products or services. Understanding customer feedback, preferences, and pain points related to competitors’ offerings helps companies tailor their own products and services to better meet expectations.
- Benchmarking Performance: CI allows companies to benchmark their performance against competitors. By comparing key performance indicators (KPIs) such as market share, revenue growth, customer satisfaction, and operational efficiency, companies can assess their competitive position.
- Anticipating Competitive Threats and Risks: Through competitive intelligence, companies can proactively identify potential competitive threats and risks. Monitoring competitor activities and industry developments enables companies to foresee challenges and plan mitigation strategies.
- Informing Product Development and Innovation: By analyzing competitor products, features, and innovations, companies can gain insights into emerging trends and customer preferences. This intelligence informs product development efforts and helps companies design products that are more appealing and differentiated in the market.
- Enhancing Pricing and Positioning Strategies: Competitive intelligence aids in understanding competitors’ pricing strategies and value propositions. Armed with this information, companies can adjust their own pricing strategies and positioning to create a unique value proposition that resonates with target customers.
- Enabling Evidence-Based Decision Making: Competitive intelligence provides factual and data-driven information that supports evidence-based decision-making. Instead of relying on assumptions or gut feelings, companies can make informed choices backed by concrete insights from the market and competitors.
Upping Your Game
Competitive intelligence provides a deeper understanding of competitor strategies, identifying market trends and opportunities, recognizing customer perceptions, benchmarking performance, anticipating threats and risks, informing product development, enhancing pricing and positioning strategies, and enabling evidence-based decision-making. By integrating competitive intelligence into their business processes, companies can stay agile, competitive, and better equipped to navigate the dynamic business landscape.
And of course, one shouldn’t overlook how competitive intelligence can generate actionable insights. In reminding strategists to not overlook the competitive insight part of the equation, Professor Horn says, “Having good competitive insight isn’t effective or useful unless it actually impacts decisions that the organization makes.”
Video courtesy of Klue/The Competitive Enablement Show
