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Updated May 07, 2024

What Is Market Intelligence?

Market intelligence is key to gaining a clear understanding and competitive advantage in your space.

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Jamie Johnson, Business Operations Insider and Senior Analyst
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This guide was reviewed by a Business News Daily editor to ensure it provides comprehensive and accurate information to aid your buying decision.

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Market intelligence refers to your understanding of the space in which your business operates and your ability to gather new information continuously. It includes a variety of activities, such as building customer profiles, conducting competitive analysis, examining trends affecting the market and the ongoing strategic adjustments all businesses must make. Market intelligence, then, is an important part of running a successful business. This guide will introduce the concept and explain how you can leverage market intelligence to prepare your company for a prosperous future.

What is market intelligence?

At its core, market intelligence uses multiple sources of information to create a broad picture of your company’s existing market. It assesses your company’s customers, problems, competition and opportunities for creating new products and services.

You can collect market intelligence by referencing sales logs, customer data, surveys and reviewing social media metrics.

Saul Dobney, CEO of research consultancy group Dobney.com, says it is easy for small companies to get started with a commonsense approach.

“It can be as simple as visiting your competitors’ websites or stores, finding published information about the number and type of potential customers, [and] keeping up to date with developments in your area from magazines, journals or business associations,” Dobney said. “It also includes checking for customer comments and feedback online that will help the business improve its offer or service.”

Did You Know?Did you know
Market intelligence involves identifying your target market and understanding the needs and trends of your consumers.

Market intelligence vs. business intelligence

Market intelligence is often confused with business intelligence but they aren’t the same thing. Business intelligence refers to data specifically about a company, while market intelligence looks at the overall trends.

In general, business intelligence is information about internal company performance. This includes how many products were shipped and the total number of sales in a month.

In contrast, market intelligence focuses on external information, including customer demographics, geographic information and what consumers buy. It also looks at the competition to see where your business stacks up relative to the rest of the marketplace. All of this can help form an analysis of business intelligence.

Market intelligence also considers what is happening with your company’s competition, which business intelligence ignores altogether.

How do companies use market intelligence?

Successful market intelligence answers concrete questions about current and potential customers and competitors and helps your company determine its internal goals. Here are some questions that market intelligence can address:

  • Where should my company devote more resources?
  • Which markets should I try to enter next?
  • What are the buying patterns of our best customers?
  • What products could be cross-marketed to existing customers?
  • Into what demographic segments can my company push new and existing products?
  • How do I conduct a market analysis?

Market intelligence helps businesses analyze the overall environment in which they are operating. This helps your business spot potential risks and identify new opportunities for growth. Most companies do this by looking at these four criteria.

Types of market intelligence

You may encounter a variety of types of market intelligence. The following are among the most common types of market intelligence to consider. 

Competitor intelligence

Competitor intelligence involves gathering and analyzing information about your competitors. Analyzing your competitors’ strengths and weaknesses can help you gain valuable information about your own company and why customers don’t always choose your product or service.

For example, a competitive analysis report is a regular tool in most marketing operations, assessing the level of service a product provides. A competitive analysis report could include everything from pricing and product features, all the way down to target audiences and key demographics. Once compiled, all of this information can be used to create a formidable product that caters to the customer while avoiding problems other businesses have faced.

Product intelligence

Product intelligence involves analyzing the quality of your product or service. If you sell a physical product, it involves looking at the manufacturing process and whether you’re building the product as efficiently as possible. The information you gather will help you improve the value of your product.

Gathering this type of intel is fairly straightforward as it requires you to look at other products on the market and assess their strengths and weaknesses. That assessment covers everything from the product itself and its packaging, how it’s displayed in stores and production processes and costs.

Market understanding

Market understanding is your sense of the different markets where you’re selling your product or service. This type of research helps you get a feel for how well you’re performing in those markets and whether there are additional markets to which you could expand.

Gathering the intelligence to gain a solid grasp of the market is a combination of competitive analysis and product intelligence, along with identifying top performers in the space. With an understanding of what’s selling on the market, you can start gathering your end-user intelligence to figure out why customers prefer those top performers.

Customer understanding

Customer understanding involves learning more about your current customers and why they buy from you. It can also help you understand any challenges you face with those customers to improve satisfaction and customer retention rates. The information you gather can also help you succeed in future marketing campaigns.

It’s common for a marketing department to put together customer personas that offer details like demographics, interests, problems they face and the solutions a business can provide to them. Those customer insights can often help an entire operation, from those in product development to the quality assurance engineers.

Key TakeawayKey takeaway
Market intelligence provides a comprehensive overview of your company’s place in the market, comparing your business to your competition and analyzing the behaviors of your target customers.

How to collect market intelligence

While there is no set plan for how companies should gather market intelligence, many do so by performing various forms of high-level analysis. Let’s look at four different strategies you can use to collect marketing intelligence.

1. Your current customers

According to Ajith Sankaran, senior vice president at Course5 Intelligence, companies often forget that customers are a potential source of data.

“Small businesses can set up processes to maintain customer lists and some kind of customer feedback program to collect customer intelligence in an effective and largely inexpensive manner,” Sankaran said.

Your sales team is also uniquely positioned to help with market intelligence. Since sales reps speak to prospects and customers regularly, they can provide additional insights into industry trends. Customer relationship management (CRM) is often the best place for a company to share this information on customers in one place.

2. Surveys

If you want to obtain your own market research data, consider sending customers online surveys or polls. Sankaran noted that this can be a useful approach, especially if you maintain your customer lists effectively.

You can use tools like SurveyMonkey or Typeform to get started. Another good option is to include a survey link on the customer’s receipt.

3. Website analytics

Dobney recommended using information to which you already have easy access: your e-commerce analytics.

“You can look at the customer journey through the website,” he said. “How many people arrive and where from? What is their next step after arriving? How many get through to the basket? How many check out? Looking for patterns and then testing different content, taglines, signposts and offers uses market intelligence to improve the offer.”

TipTip
CRM analytics offer an easy way to give your business insights into customer behavior and the performance of your marketing efforts. Learn how CRM analytics work in our comprehensive guide.

4. An in-house specialist

If your company is large enough, you may be able to hire a market intelligence analyst. As a specialist, the analyst can develop a more nuanced picture of the market.

They’ll do this by communicating with manufacturers, distributors and clients involved in the creation and distribution of your company’s products. This type of dialogue ― along with hard data and marketing research ― comprises the majority of the market intelligence.

Once this information is processed, you can use it to determine profitable opportunities in the market.

How to manage market intelligence

Market intelligence can give you greater insight into your industry and help you identify new expansion opportunities. However, it’s only useful if the information you receive is accurate.

Unfortunately, staying on top of market intelligence can quickly become time-consuming for small business owners. That’s why there are many online tools available to help you gather, analyze and store your market intelligence.

Popular software options for companies in need of a business intelligence system include Pentaho and Sisense. Alternatively, cloud services, such as Oracle and Birst, can help you share business intelligence among units easily.

While an individual can handle much of the work of market research for a small company as your company grows you may need to devote more time to analyzing data. As the amount of information increases, it may become necessary to use statistical tools and more complex technologies to handle and manipulate the data, Dobney added.

If you are not prepared to learn a software package or hire an in-house analyst, a third-party specialist may be able to help you make the most of your market intelligence. That way, you can understand your current market environment and make the most of the opportunities available to your business.

Knowing the lay of the land is key to success

Conducting market intelligence to gather information about your space, your customers, your competitors and how your business can grow serves to guide your plans for both the short- and long-term. Without a clear understanding of the market in which your business operates, you can’t expect to survive for very long. However, the more intelligence you gather and the more it informs your overall business plan, the better off you’ll be. Building market intelligence into your operations and remaining flexible to pivot as needed are key elements of building a successful company that can stand the test of time. Does your business have the market intelligence it needs?

Eduardo Vasconcellos and Tejas Vemparala contributed to this article. Source interviews were conducted for a previous version of this article.

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Jamie Johnson, Business Operations Insider and Senior Analyst
For more than five years, Jamie Johnson has been guiding business owners on financial matters both big and small. This includes investment advice, insights on business loans and funding options, recommendations on insurance and more. Johnson excels at delivering easy-to-understand direction so entrepreneurs can make the best financial decisions for their businesses and, as a solopreneur herself, she regularly tests business strategies and services. Johnson's expertise can be found in a variety of finance publications, including InvestorPlace, Credit Karma, Insurify and Rocket Mortgage. She has also demonstrated a deep understanding of other B2B topics — including sales, payroll, marketing and social media — for the likes of the U.S. Chamber of Commerce, U.S. News & World Report, CNN, USA Today and Business Insider.
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