According to Investopedia, Competitive Intelligence (CI) is the ability to gather, analyze, and use information about competitors, customers, and other market factors that drive a company's competitive advantage. This strategy generally encourages companies to collect information efficiently and ethically from various published and unpublished sources.
As Glints explained, in this modern world, CI is very important for the business development of a company. Because the information collected can help companies understand their competitive environment and related opportunities and challenges. CI also encourages companies to analyze data which can create more efficient and effective business practices.
3 Factors Analyzed in Competitive Intelligence
In fact, competitive intelligence is a certain step that a company can take to find out the business performance of its competitors. However, a well put together CI can pinpoint trends even before the official market launch. Of course, this can help the company stay ahead of the competition in the market. But what factors must be analyzed to obtain high-quality competitive information? Here's an explanation:
1. Product prices
The first factor a company must analyze in order to gain valuable competitive information is the price of its competitors' products. Knowing the price of competitors' products is the right step to filter CI. Then why? This is because this information allows the company to keep the price of its products in line with market expectations, according to Thrive Hive.
In addition, the information obtained can provide company insights regarding pricing models that are more attractive to customers. So, broadly speaking, how can a company price a product that matches customer needs in the marketplace? Don't worry, you can learn the strategy on the Glints ExpertClass website. Business experts are ready to share their knowledge with you in the Business Fundamentals category.
2. Search marketing
It cannot be denied that SEO and SEM play an important role in the development of a company's business. Based on these facts, one of the factors that a company needs to analyze if it wants to obtain good competitive intelligence is the market driving performance of its competitors.
This is because there are quite a number of competing companies that have better SEO and SEM strategies. By knowing the marketing qualities of competitors' market engines, companies can assess the strengths and weaknesses of their market engine strategies.
3. Web design
The next factor that companies need to analyze if they want to get good competitive intelligence is the website design of competitors' websites. While a company needs to maintain a unique identity, website optimization can be achieved by looking at competitors' design strategies.
Therefore, while analyzing competitors' websites, companies must be careful not to create a new look to copy. Instead, according to Big Business, they should pay attention to good design aspects and implement them on the website according to the corporate identity.
Competitive Intelligence Benefits
Competitive intelligence can help companies monitor competitors' progress. This information can be used as a guide for all future business decisions of the company. However, CI offers many other attractive benefits. Following are the achievements according to Chron:
- Competitiveness helps companies understand the development of market trends.
- The information obtained can be a loophole for the company in filtering customer needs.
Competitiveness can be used as a benchmark for the success of a company's business strategy.
Realizing the Importance of Competitive Intelligence in Business
Basically, CI refers to knowledge (both past and future) about the company's external environment that decision makers need to know and understand in order to take actions or decisions that benefit the company. Michael Porter says in his book Competitive Strategy that we must always revise existing assumptions to be competitive. Of course by considering all factors of the competitive environment, and always starting with the customer (not just competitors) as follows:
Peter Drucker said that the goal of a business is to retain and win customers. Companies that are able to convey the views that customers want are rewarded with increased sales, number of customers, and market share. One thing to keep in mind:
not competitors who buy products or services, but customers. And it is the customer who provides more useful advice or information. Therefore, more attention should be paid to customers than competitors. One example is the bookstore Borders, which added a coffee shop to its store to keep customers in the store longer.
Suppliers are interested in the industry in which the company operates and making them a source of information about threats or trends is the right move.
Can offer more than just a channel, because in most industries the distributor is the buyer - the portal to other customers. They know what is right for the market and how to identify barriers to entry in certain markets. Business people also have the opportunity to analyze the market, for example using a SWOT analysis. The information obtained will later be useful for the company to adjust sales and marketing strategies or even turn failure into success.
a. Direct: Companies that offer similar or identical products or services to the same customers.
b. Indirect: Companies operating in the same or related industry.
c. Subtitute: A company operating in a different industry but offering similar or identical products or services.
Are there other offerings that customers perceive as alternatives to the product or service used
These technologies have a huge impact (either directly or indirectly) on products, services, and industries, making the competitive environment increasingly uncertain.
A key component of customers is the demographic makeup of that population, whether they are customers or not. Demographics largely define the landscape and are critical to developing products that serve a segment (or majority) of customers.
Including Society, lifestyle and behavior - which are constantly changing. Cultural analysis can provide certainty whether the product or service offered is in accordance with current social issues or trends.
9. Economy Economic
conditions clearly impact customers - their buying behavior and purchasing power. Responsive companies adapt their products or services to the existing economic situation.
10. Regulation: Industry and Government
This is the biggest factor that can influence marketing decisions. Companies should always do their homework by finding out which regulations are in preparation or pending - whether they affect our company's products or services.
11. Other Industries
All companies will definitely have an impact on the local industry, so companies must pay attention to the indirect market.