Competitive intelligence (CI) has evolved beyond simple website monitoring and social media listening. It’s no longer enough to simply collect public information and draw conclusions about competitor strategies.
Today’s market landscape is ever-shifting. Between unpredictable external events making ambiguous market impacts, consolidation of market cap to fewer and fewer stocks, or complicated geopolitical factors, all of the aforementioned and beyond have made competitive intelligence more complex than ever before.
Companies that have true CI strategies—ones that elevate their positioning and give them a competitive edge—have recognized this new complexity and adopted advanced tools and best practices necessary for navigating more effectively. Most notably, companies must understand two major points: the first is tracking market trends and competitive activity in real-time. The second is the need for new and advanced content sources as opposed to the publicly available information that everyone is monitoring.
In this guide, we’ll walk through the components of effective competitive intelligence, plus best practices for implementing a successful CI strategy at your organization.
What is Competitive Intelligence?
Do you know what your competitors are doing? If not, you’re at a disadvantage. Competitive intelligence is the process of monitoring your competitors’ activities to gain an advantage in the market. Competitive intel can help you understand their strengths and weaknesses, as well as their plans for the future. Gathering competitive intelligence can help you make better business decisions and stay ahead of the competition.
When it comes to gathering CI, there are many ways to do so. Some organizations use secondary sources such as industry reports or conduct primary research through surveys or interviews while others engage in competitive monitoring, which involves observing a competitor’s marketing communications, product launches, or website activity.
Once gathered, CI must be analyzed in order for it to be useful, and to do so, this typically involves creating a competitive intelligence strategy. This strategy should identify business goals and objectives, as well as the information that is most relevant to those goals. It is essential to consider how the collected competitive intelligence will be used and shared within the organization.
CI is an important tool for any business that wants to stay ahead of the competition. Gathering and analyzing information about your competitors can give your business a critical advantage in the marketplace.
What is a Competitive Intelligence Strategy?
If you’re looking for ways to give your business an edge, then a competitive intelligence strategy may be the answer. But what is a competitive intelligence strategy, and how can it help your business? Continue reading and we’ll discuss what a competitive intelligence strategy is and how you can use it to gain an edge over your competitors. We’ll also explore some of the benefits of using a competitive intelligence strategy.
Once competitive intelligence has been gathered, it must be analyzed in order to be useful. This process works best when it involves using artificial intelligence (AI) tools to identify patterns and trends. After the data has been analyzed, it can be used to inform strategic decision-making. For example, a company might use CI to decide which markets to enter or what products to develop next.
An effective competitive intelligence strategy (CIS) can give an organization a significant advantage over its competitors. By understanding the competition, companies can make better decisions about how to position themselves in the marketplace and allocate their resources more effectively.
What are the Main Components of Competitive Intelligence?
There are four main components of CI:
- Competitor analysis
- Competitive benchmarking
- Competitive landscape analysis
- Competitive monitoring
Competitor analysis involves studying your competitor’s business in order to understand its strengths and weaknesses. This includes looking at their product offerings, pricing strategies, marketing campaigns, and operations.
Competitive benchmarking is the process of comparing your own business against your competitors in order to identify areas in which you can improve.
Competitive landscape analysis is a broad overview of the competitive environment in which your business operates. This includes industry trends, macroeconomic factors, and regulatory changes.
Competitive monitoring is the ongoing process of tracking your competitor’s activities and measuring their impact on your business.
What are the Benefits of Competitive Intelligence?
The advantages to using CI are plentiful. It can help you identify opportunities that your competitors are missing and provide insights into your competitor’s strategies, allowing you to adjust your own plans accordingly. CI can also help you anticipate changes in the marketplace and make sure that you are prepared for them. Lastly, CI can help you build better relationships with your customers by understanding their needs and wants better than your competition.
However, there are also some disadvantages to using CI. Not only can it be time-consuming and expensive to gather all of the necessary information, but it can also be difficult to interpret this information correctly. And if used incorrectly, CI can give you a false sense of security or lead you to make bad decisions.
When used correctly, competitive intelligence can be a powerful tool that gives businesses an edge over their competition. Understanding the limitations of CI and its use in combination with other information sources will ensure that you are making the best possible decisions for your company.
Step 1: Align Your CI Strategy with Larger Objectives
A smart competitive intelligence strategy is built around the larger business objectives of your company. To accomplish this, you want to ask yourself two important questions: Who do you need to monitor, and why?
Let’s dive into each of these questions in more detail.
Why Do You Need Competitive Intelligence?
This is the first and most critical question you should ask yourself before you begin developing your actual competitive intelligence strategy. There are a lot of reasons a company might decide to start or enhance its approach to CI. Perhaps you are looking to inform your organization’s product strategy. Maybe you’re considering expanding into a new market. Or you might just want to learn more about a new technology one of your competitors is buying or building.
Whatever the reason, knowing the purpose behind your competitive intelligence efforts serves as your guide during the strategy development process.
What Do You Need to Monitor?
It’s impossible to closely monitor every competitor. To successfully maximize your ability to monitor every relevant competitor, categorize them into three levels:
- Broad awareness – This group can number in the hundreds.
- Substantial intelligence – This group should be around 50.
- Close monitoring – This group should be fewer than 20 but ideally between 5-10.
Step 2: Optimize Data Gathering
About 97 zettabytes of data are projected to be created in 2022, and that number is expected to increase to 181 zettabytes by 2025. That’s nearly 2 zettabytes every week this year. These are numbers that are difficult for humans to even wrap their brains around.
Sorting through data at this volume to locate and analyze the information we need is impossible without the help of AI and machine learning. But the real trick is to learn how to utilize these tools to efficiently gather competitive intelligence data.
Automation
Automating your data gathering as much as possible not only creates more internal efficiency, it also ensures you never miss an important update. There are four tactics you can incorporate to quickly up your efficiency game:
- Set up automatic alerts for companies and topics you’re monitoring.
- Sign up to receive marketing materials from your competitors.
- Create a list of important events (conferences, trade shows, etc.) and set calendar reminders on the dates they occur.
- Set monthly and quarterly reminders to check out competitor earnings calls and reports.
Four Voices Framework
Competitive intelligence professionals can fall victim to following the establishment set forth, and getting stuck in the ‘old’ way of doing things. Luckily, we’ve come far since the days of purely monitoring social media and websites to infer strategy and insights.
Well-rounded competitive intelligence requires the inclusion of varied perspectives on any given company or industry. Professionals that have the edge over their competition are incorporating the four perspectives.
As the name implies, there are four important perspectives in the data you gather. They are:
- Voice of the Company – What do a company’s documents (i.e. presentations, press releases, financial statements, marketing materials, reports, etc.) say?
- Voice of the Analyst – What do Wall Street analysts say about a company’s outlook?
- Voice of the Expert – What do those with firsthand knowledge (former employees, competitors, clients, etc.) of the company say?
- Voice of the Journalist – What is the news saying about this company?
Utilizing a competitive intelligence platform can be immensely beneficial for accessing as much information as possible about private companies since it is often not available to the public.
Step 3: Analyze Effectively
Effective data analysis enables you to pull the most important insights from your competitive intelligence data and make them actionable for your organization. A critical best practice to this end is to build processes that allow for regular (daily, weekly, monthly, annual, etc.) analysis.
When establishing a process, you can utilize frameworks for organizing and analyzing data that align with your company’s current goals and larger business objectives. SWOT and PEST frameworks are two widely used and powerful tools for leveraging data to determine your company’s position in the marketplace.
A SWOT analysis helps you identify your own internal strengths and weaknesses, as well as external opportunities and threats. They’re helpful for startups navigating new entries into the market and for established companies launching new initiatives, pivoting strategically, or performing a competitive landscape analysis.
A PEST analysis helps you identify political, economic, social, and technological factors that may impact your business performance. They’re helpful for any company looking to understand how their decisions and/or strategy will fit with unavoidable real-world factors.
Step 4: Report Consistently
Competitive intelligence data is only as powerful as you make it. For this reason, it’s essential to report on your findings consistently, leveraging data to inform key stakeholders, and build strategies that align with your current competitive landscape. The key here is to consider how to make data digestible for stakeholders who are unlikely to sift through all the details themselves.
Create a broad presentation, then drill down
What are the most important insights for everyone to know? Include those in a broad presentation. Then highlight specific insights most relevant for different stakeholder groups and tailor the data you share to each group.
Make it Visual
Using visual data representations, such as charts and graphs, not only makes data more digestible but also more powerfully communicates changing trends. Other visual components that can be effective include images (product photos or logos) or short videos ( news clips or interviews). Visuals break up text and numerical data and highlight important takeaways for your stakeholders.
Tell a Story
It’s no secret that telling a story keeps stakeholders more engaged in what your data has to say. As you create a report or presentation, look at your data from this perspective. What story is it telling? Make sure it’s evident in the way your data is presented (the order of your slides or the specific data points you chose to focus on).
Make it Actionable
Company leaders want to know why the data is important. A significant part of that is knowing the action it spurs going forward. As the presenter, think about what actions are required to leverage your competitive intelligence data to its highest potential. This could be several things, from a pivot in marketing strategy to reprioritizing product offerings.
Competitive Intelligence in Action
As you take steps to launch your competitive intelligence strategy, remember: CI is more than a one-time process. It’s an ongoing strategy built into your organization to drive its success. Using a competitive intelligence platform centralizes and streamlines your efforts, ensuring you never miss a single important data point ever again.