What is Market Intelligence? | How it Helps Improve Supply Chains

What is Market Intelligence?

Market intelligence (MI) refers to the systematic gathering and analysis of data on market conditions, competitors, and customer behaviors in making key business decisions.

With market intelligence, businesses can stay ahead in viewing trends of the markets, consumer tastes, and preferences in competitive forces to their advantage in making very informed decisions and refining marketing strategies. A company is therefore better placed to remain ahead in a competitive business environment if it fully understands the needs of the customer and efficiently adapts to changes in the market.

This potential ability to inform an organization in respect of marketing intelligence is highly beneficial as it facilitates decision-making, ensures the allocation of resources, and enhances competitive positioning within markets.

By leveraging market intelligence, organizations can find opportunities in the marketplace and acquire relevant analytics concerning campaigns. Global trade data plays a crucial role here, offering insights on international trading activities, identifying key markets, and evaluating the supply chain. This places businesses in a better position to adjust strategies based on real-time insights for better customer engagement, winning more market share, and running a robust business.

Why is Market Intelligence Important?

Market intelligence is crucial for businesses to stay aligned with the evolving market landscape. It includes competitive intelligence to understand rivals, customer intelligence to grasp behaviors and feedback, product intelligence for evaluating performance, and market trend intelligence to spot emerging trends. Together, these types of market intelligence help companies make informed decisions, anticipate changes, and optimize operations for success.

Strategic Planning

Gaining a thorough understanding of consumer behavior, market conditions, and competition dynamics is necessary for effective strategic planning. Market intelligence is therefore crucial for establishing data-driven, realistic goals and for identifying potential roadblocks.

In case there is a lack of credible market data, then companies fall back on gut feeling or old knowledge, resulting in less-than-optimal strategies, which finally leads to losing out on potential opportunities.

Market intelligence helps companies harness a broad source of data and insight, from consumer preference and market trends to competitor activity. The data aids in devising a plan that takes into consideration the present status of the market and its future expectations.

Product Development

Product development requires an understanding of the significance of market changes and client needs. Market intelligence is crucial in ensuring that new products satisfy these needs, reducing the possibility of a product failing and increasing the market's acceptance.

Market intelligence assists with relevant information regarding consumer preferences, new trends, and rival product offerings is provided by it. Such data analysis enables the identification of market gaps and innovative opportunities.

Marketing and Sales

A thorough understanding of target consumer behavior is necessary to develop effective sales and marketing tactics. To properly target audiences and engage with them through the most effective channel, marketing efforts must be optimized. This requires the use of market information.

Market intelligence helps emphasize a target demographic's most active location, the communications that appeal to them, and the most effective means for reaching them.

A retailer may use market intelligence to find out which social media their target customers are most engaged with. Armed with this information, it would allow the retailer to focus its marketing efforts on those platforms and devise campaigns most likely to encourage engagement and conversions. This way, market intelligence can refine sales strategies by identifying the most promising customer segments and tailoring approaches to meet their specific needs, hence enhancing overall sales performance.

Competitive Positioning

An organization needs to know its competitive position in a given market to sustain. It helps identify the strategies of competitors, assesses their strengths and weaknesses, and position. For example, Trademo’s global trade data sets provide competitive information such as top trading partners, NVOCCs/VOCCs, country of origin for imports, etc. for each US-based company.

Analyzing what competitors are doing regarding pricing strategies, promotional tactics, and market positioning is another prominent factor that market intelligence does. Knowing these elements, businesses can spot opportunities to differentiate themselves and better their position in the market. Moreover, trade compliance software offers competitive intelligence by monitoring trade regulations, ensuring businesses maintain a competitive edge while complying with international standards.

A manufacturing company might make use of market intelligence to research the pricing and promotion plans of its competitors. Armed with that type of information, the business would be better positioned to adjust its pricing and marketing techniques in such a way as to provide superior value or unique features that will make it more attractive to customers. Effective competitive positioning, guided by market intelligence, differentiates a business in the market and yields better shares of the target audience.

Risk Mitigation

A very critical factor for the protection of the stability and continuity of a business is the identification and mitigation of risks. Market intelligence will help in identifying the challenges that may be presented in the market, and then devise ways to mitigate them before they occur.

Market intelligence can aid in the detection of any early warnings related to regulatory risks, market volatility, or changes in customer behavior. Drawing support from these elements, a business is better positioned to develop contingency plans and revise the strategies put in place to diminish the risks.

A pharmaceutical company could utilize market intelligence to track changes in regulations and compliance strategies. This proactive approach can help businesses avoid disruptions and maintain a stable operating environment. By leveraging market intelligence for risk mitigation, companies can overcome uncertainties and protect their long-term interests.

Impacts and Benefits of Market Intelligence

The role of market intelligence works at a deeper level as an enabler of business strategy and operational plans. It offers several benefits to companies so that they can survive and grow on a sustainable note in inherently complex markets. A closer look has been given herein to how market intelligence impacts businesses, along with the associated benefits, characterized through live cases.

1. Decision-Making with Enhanced Intelligence

Market intelligence gives a business accurate and full information to base decisions on, rather than upon intuition or gut feel.

One advantage of using market intelligence is that there is less chance of making bad decisions that result in lost opportunities or financial losses. The second is enhanced accuracy with data-driven insight, which guarantees that decisions are made based on factual evidence and raises the likelihood of success.

IBM, a leader in computer technology, uses market intelligence tools and software for its strategic decisions related to the technology industry. By understanding the trends in the market, the needs of their customers, and the moves of their competitors, IBM chooses whether to develop new products and enter markets. This process is exactly how IBM was able to pivot to cloud computing and artificial intelligence. It became colossal in both.

2. Identification of Growth Opportunities

Market data and consumer behavior analysis let one know about untapped market segments and new growth avenues.

Market intelligence enables targeted exponentials in those places that have high potential and ensures the adoption of effective strategies to grow there. Similarly, innovation suggests market gaps and emerging trends, driving innovation and product development.

Amazon is recognized as one of the leading organizations worldwide, It identifies new markets and redesigns or improves its products. For example, according to the information from market intelligence, a new demand was increasing for smart home devices; therefore, Amazon created and launched the Echo series. This increased the presence of Amazon in the technical market, and the revenue of the company dramatically spiked up.

3. Superior Customer Satisfaction

Customer expectations and behaviors gained through market intelligence can help tailor products/service company plans for its customers.

Customized Experience of Products and services relevant to customers can be designed. Increased Loyalty Churning rates are also brought down due to a higher level of satisfaction and, therefore, loyalty when a customer's needs and requirements are met.

Another great example of market intelligence applied to Spotify enables a better user experience by analyzing the trends of its user's listening habits and preferences. This will finally allow Spotify to offer users more personalized playlists and recommendations, eventually ramping up user engagement and satisfaction. Indeed, this is reflected in the huge and growing user base of Spotify, making it a stronger position in the market.

4. Optimized Resource Allocation

From the information from market intelligence, businesses can channel their resources to areas that will have an impact and troubleshoot areas of attention.

Efficient resource utilization impacts Businesses can channel resources in one area promising returns on that investment. Carrying out savings on Cost-avoiding investing in low-potential areas will save on business costs and, hence, bring more profit.

Procter & Gamble uses market intelligence to optimize its product and marketing strategies. It understands consumer insights and market trends and thereby allocates resources to product lines and marketing campaigns that are most likely to succeed. This has resulted in successful product launches and the efficient use of marketing budgets.

How to Create Market Intelligence

Creating market intelligence is a challenge on its own. The largest companies in the world hire dedicated analysts & teams that work to gain the market intelligence that a company needs.

However, there are two key requirements to generate insights from market intelligence:

Data Collection

Data forms the foundation of market intelligence research. There are various sources of data that can be converted to market intelligence and shaped into insights by your analysis teams. However, there are no exact divisions for the data for market intelligence.

To simplify it, we are choosing to divide it based on the source of the data. All the sources are important in their own right and only through their proper analysis can businesses create actionable market intelligence. There are roughly four categories of data you need for market intelligence:

• Online Data: Data that can be gathered from the online avenues of a business comes under this category. This includes website data (traffic, conversion rate, purchases), ads (ad performance, CTR, impressions), email(campaign performance, open rate) eCommerce sales, website sales, etc. For the most part, this data can be collected within the organization with the help of various internal tools. In addition, online data for your competitors can be found with the help of other 3rd party websites. Online data is crucial since user feedback, online surveys, etc. form an important part of market intelligence data.

• Offline Data: Offline data includes sources such as store sales, manufacturing numbers, inventory dispatch numbers, warehouse numbers, etc. This data helps understand the market performance of a product and its analysis can create important insights. Other offline campaigns such as interviews, live surveys, test launches, events, etc. can also generate a lot of market intelligence data that your data analysis teams need.

• Trade Data: Trade data is often overlooked when gathering market intelligence data. It is the factor that sets apart the biggest businesses. Their access to trade & import and export data helps them create direct market intelligence to help improve a business’ supply chains. It involves the study of global import-export data that can be used to increase resilience and efficiency within supply chains. Information such as new importers/exporters, ideal trade lanes, the best NVOCCs/VOCCs, competition supply chains, etc. can help make more data-driven decisions. For example, food manufacturer/distributor Jans Food uses Trademo Intel’s trade data to find new buyers/sellers to improve its supply chain and venture into new product markets.

• Derived Data: Derived data are the insights gained by manipulating and reevaluating the other forms of business data. This includes historical data for a business, past trends, and product category trends that can be found through 3rd party data marketplaces. Strategic long-term decisions require the use of derived data.

Data Analysis

As defined above, market intelligence is nothing without the proper analysis of the data you gather. Without analysis, all you have is information about your market. To truly understand it, you need to perform advanced data analysis on the various data sets you have gathered.

Improvements and modifications such as Conjoint analytics, classification analysis, Maxdiff analysis, sentiment analysis, regression analysis, and more on the data you have gathered. It is recommended that businesses hire in-house specialists to analyze the data they have gathered.

They can improve your findings by comparing data with their sources and empower you with the correct market intelligence.

Market Intelligence in Supply Chains

As discussed above, Market intelligence data can be applied across business processes. However, one of the key areas where it is used happens to be in business supply chains.

Supply chains are in constant need of new avenues to improve & optimize. Generating market intelligence reports can provide them with the data they need to improve. Creating intelligence for supply chains out of trade data and derived data is standard industry practice.

Good market intelligence reports help mitigate delays caused by supply chain disruptions. According to a recent survey, 77% of businesses in 2023 are investing in market intelligence to help them create more resilient, more affordable, and sustainable supply chains.

This will further increase their supply chain’s dependency on market intelligence.

Do Companies Need Market Intelligence?

The simple answer is Yes. Done right, market intelligence can drive revenue to your business. It can help you identify new and existing trends, find new opportunities, and expand your business.

However, market intelligence is only useful if the information you get is correct. The wrong insights may impact your business negatively. Therefore, the data you get must be authentic and accurate. In addition, market intelligence is a continuous process as you gather more & more data.

For small businesses, staying on top of market intelligence can be challenging. It is a time-consuming and resource-intensive process and smaller businesses often lack the resources they require. For starters, you will need proper analysis tools to study the data you’ve gathered.

It is imperative for your business to have a dedicated team responsible for analyzing data. You also need dedicated people to generate market intelligence reports. You can find consultants for creating market intelligence research and its related reports.

There is also a plethora of software that provides market intelligence analysis, however, you still need analysts to properly understand the insights that you’re looking for. Simpler insights can be found within data tools. Trademo Intel, for example, has dedicated analytics for trade data that can provide direct decision-making insights for supply chains.

Summing Up

Market intelligence is true innovation. Supported by AI & ML market intelligence platforms, it can revolutionize how businesses make crucial business decisions. However, generating market intelligence reports is not a simple process.

To truly gain the right insights from it, you first need to create a brilliant market intelligence team. In addition, it takes time, patience, and the willingness to take risks. Done right, market intelligence can become a key strategic asset for your company’s future.