By collecting and analyzing data about the markets in which they are situated, companies gain valuable insight into how to grow their business.
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Today's businesses keep track of internal processes and company data with business intelligence systems. But how do they keep tabs on the competition or analyze what's happening in their industry or the markets where they do business?
Many businesses focus on market intelligence to put their business intelligence in context. Market intelligence is a broad concept, but those who analyze it do often focus on specific elements of a given market, such as a geographic location or a particular demographic of consumer.
Where should a company devote more resources? Which markets should it try to infiltrate next? These are some of the questions that market intelligence analysts try to answer.
While there is no set plan for how companies gather market intelligence, many do so by performing several interconnected activities.
One of the cornerstones of good market intelligence is good information. By collecting and analyzing data about the markets in which they are situated, companies gain valuable insight into how to grow their business.
And good market intelligence also relies on real people. Market intelligence analysts communicate with manufacturers, distributors, clients and others involved in the creation and distribution of a company's products. This dialogue helps analysts develop a more nuanced picture of a given market.
Market intelligence analysts also draw insights from the information gathered by marketing researchers. Marketing researchers study consumer trends and reactions to different products.
Hard data, dialogue and marketing research make up the majority of a company's market intelligence. Once this information is processed, businesses use it to make important decisions, including determining market opportunity and creating market development metrics.
Market intelligence vs. business intelligence
Unlike business intelligence, which deals with the self-analysis of a business, market intelligence deals with the analysis of the external factors affecting a business.
Business intelligence analysts focus on how many products were shipped, the total number of sales in a month and other transactions occurring within a business.
While this information is very important, business intelligence is not as useful in the decision-making process when it lacks context. Market intelligence provides this context because it demonstrates what's going on in the market as a whole.
Market intelligence also takes into account what is happening with the competition, something that business intelligence ignores altogether. There is also a separate, but interrelated branch, of data analysis that deals with this issue: competitive intelligence.
Market intelligence tools
Keeping track of all the information included in market intelligence requires serious tools. Many companies have a business intelligence software system in place to gather, analyze and store data.
There are many popular software options for companies in need of a business intelligence system. Many cloud-based providers also offer business intelligence systems and data storage solutions for business.
In a traditional business intelligence system, data is stored using an extract, transform and load (ETL) processor. This means that information from different departments of a company is collected, synthesized and stored in one place, usually on a third party server or in the cloud.
Everything from the human relations department's statistics to the accounting department's figures all end up in this giant database. In such a system, market intelligence is simply incorporated into the business intelligence process.