Information is everywhere. A quick internet search can uncover a whole array of information on any number of topics, with information on customers, suppliers, competitors, distributors and the latest market trends all waiting to be found.
However, the amount of information available does not guarantee its quality. In fact, it’s the valuable information that is often the most difficult to find. Take competitor intelligence for example, a subject on which information can be hugely valuable to businesses but incredibly difficult to find.
It is in these situations, therefore, that market intelligence specialists really prove their value. The specific, validated and well-presented information that market intelligence specialists offer can provide real insights that decision-makers rely on, as opposed to the generic information that is readily available on the internet.
Market intelligence is used to assist with business decision making, and the insights provided can be crucial in helping a business to grow and improve. There are numerous ways market intelligence can be used to add value to a business, and these will be discussed below.
Market intelligence can be gathered to help with entering a new market or expanding presence in an existing market. Intelligence obtained for this purpose usually takes the form of a market entry or market expansion study. Typically, market intelligence specialists will consult a number of different sources in order to obtain a 360-degree view of the market in question, in order to inform strategic decision making.
Market intelligence research can also be conducted to help minimize the risk that the wrong investment decision is made. This type of study is often utilized prior to an acquisition or merger. Acquisition studies form part of the due diligence of an acquisition target, and various sources of information are tapped into, to assess the potential of the company in question.
Market intelligence used to keep ahead of the competition and obtain first-mover advantage over competitors is known as a competitor intelligence study. Competitor intelligence studies are becoming increasingly more popular as companies seek to gain valuable insights into the competition, and to better understand the competitive landscape. Studies of this nature typically comprise obtaining information from a number of different sources, each providing specific insights into the competitor and their operations.
Market intelligence is gathered primarily for the purpose of expanding and improving a business. Therefore, the aim of any intelligence is to help increase profitability. However, how does a company measure the real return on investment of market intelligence research? Measuring ROI is extremely difficult, especially if the aim is to provide a single, definitive figure. However, it is possible to compare the relative returns of different types of research. In general, the higher the cost of a study, the higher the typical increase in revenues. Market entry, market expansion and market assessment studies yield the most substantial returns due to the higher associated costs of the study. For example, the estimated ROI of a study costing $200,000, should lead to a typical increase in revenues of around 50% over three years. For projects costing less than this, the returns are often scaled down accordingly. At the lower end of the scale, a needs assessment study costing around $50,000 should lead to a typical increase of around 10%.