Market intelligence
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Market intelligence (MI) is gathering and analyzing information relevant to a company's market - trends, competitor and customer (existing, lost and targeted) monitoring.[1] It is a subtype of competitive intelligence (CI), which is data and information gathered by companies that provide continuous insight into market trends such as competitors' and customers' values and preferences.[1][2]
MI along with the marketing capabilities of an organization provides a guideline into the allocation and implementation of resources and processes.[3] It is used for the purpose of continuously supplying strategic marketing planning for organizations to gauge marketing positions in order for companies to gain competitive advantage and best meet objectives.[4][1]
Organizations can develop MI frameworks and models that are suited to financial capabilities and desired market sectors but are mainly based on the four-step process of collection, validation, processing and communication of MI.[5] The gathering of MI data is sorted into many different categories, including, but not limited to, qualitative, quantitative, formal, informal, published, and unpublished.[6] MI data is gathered both internally and externally.[6]
Benefits that MI can bring are that it provides customer, competitor and market insights allowing organizations to gain a competitive advantage in their marketing strategies.[1] Issues that MI can bring is through acquiring data and information through illegal or unethical ways, it can lead to financial loss and government regulatory failures.[7]
Background and Development
[edit]MI and its broader term, marketing intelligence, was first introduced in “Marketing Intelligence for Top Management” by Kelley,[8] to provide information that was analyzed, reliable and consistent for an organization to better create policies and make business decisions.[8]
Following Kelley, in “How to Develop a Marketing Intelligence System”, R. Pinkerton shows the proactiveness of organizations as marketing intelligence systems is applied whilst the technological revolution arises.[9] Contributions to MI include professional organizations such as “Global Intelligence Alliance” and “the Society of Competitive Intelligence Professionals” (SCIP).[10] These organizations have contributed both empirical and theoretical research in an attempt to further define and understand MI.[10]
As research into MI comes from scholars and non-scholars of different backgrounds it has resulted in a fragmented state of research. This has led to MI being used interchangeably with other market terms such as competitive intelligence, business intelligence and strategic intelligence.[10] MI to this current date continues to change to meet organizational requirements.[8]
Framework
[edit]The implementation of MI varies depending on how organizations perceive it.[4] MI is defined as being composed of three main activities, these activities are Information Acquisition, the gathering of marketing information that is required for current and future customer needs, Information Analysis which is the intelligence gained from the information collected and Information Activation, which is using the intelligence to implement and develop marketing plans.[6]
Frameworks can be flexible, however the basis that organizations use to model the MI surrounds a four-step process, which are, collection, validation, processing and communication.[5] Data mining techniques are used throughout the processes to aid in the gathering and analyzing of data and information retrieved.[citation needed] MI is a continuous process that organizations need to keep track of to improve their strategic and tactical marketing planning.[11] These processes target the three activities that MI is defined by.[6] The model can be adjusted and adapted when required and can be implemented all at once or by sections.[4]
Collection
[edit]Collection is the first step in the MI model, it involves the gathering of data and information of a particular market sector.[4] Such data and information can be gathered from external sources, such as other organisations and their market strategies, research institutes and business reports.[4]
Internal factors can include looking into current strategy processes and personal customer trends.[4] It is estimated that 70% to 80% of intelligence resides within organizations employees or, internal MI network, as they are the team who gains information's when interacting with suppliers, customers and other industry contacts.[12] To involve employees into an intelligence program to gain data and information the following considerations can be noted: developing a rewards program to promote participation, providing MI goals, requirements and a timeframe for information to be given in and creating a proper communication method to promote the intelligence program with employees such as using an e-mail system.[13][14]
Validation
[edit]
Validation is the second step in the MI model, this which can be referred to as data cleansing.[4][16] The maintenance of good data quality is important as data and information is being retrieved from many different sources.[16] Data and information obtained from sources can be dirty, meaning that it is incomplete, wrong, inappropriate, duplicated.[4] This step will allow data and information to be adjusted and understandable to the organization, furthermore it allows for consistency and compliance to be present.[4] If data quality is not maintained correctly it can lead to organizational losses with revenue and governmental