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Market intelligence (MI) is gathering and analyzing information relevant to a company's market - trends,
competitor Competition is a rivalry where two or more parties strive for a common goal which cannot be shared: where one's gain is the other's loss (an example of which is a zero-sum game). Competition can arise between entities such as organisms, indivi ...
and customer (existing, lost and targeted) monitoring. It is a subtype of
competitive intelligence Competitive intelligence (CI) is the process and forward-looking practices used in producing knowledge about the competitive environment to improve organizational performance. It involves the systematic collection and analysis of information from ...
(CI), which is
data In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
and
information Information is an abstract concept that refers to that which has the power to inform. At the most fundamental level information pertains to the interpretation of that which may be sensed. Any natural process that is not completely random, ...
gathered by companies that provide continuous insight into market trends such as competitors' and customers' values and preferences. MI along with the
marketing Marketing is the process of exploring, creating, and delivering value to meet the needs of a target market in terms of goods and services; potentially including selection of a target audience; selection of certain attributes or themes to emph ...
capabilities of an organization provides a guideline into the allocation and implementation of resources and processes. It is used for the purpose of continuously supplying
strategic marketing Marketing strategy allows organizations to focus limited resources on best opportunities to increase sales and achieve a competitive advantage in the market. Strategic marketing emerged in the 1970s/80s as a distinct field of study, further bui ...
planning for organizations to gauge marketing positions in order for companies to gain
competitive advantage In business, a competitive advantage is an attribute that allows an organization to outperform its competitors. A competitive advantage may include access to natural resources, such as high-grade ores or a low-cost power source, highly skilled ...
and best meet objectives. 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. The gathering of MI data is sorted into many different categories, including, but not limited to, qualitative,
quantitative Quantitative may refer to: * Quantitative research, scientific investigation of quantitative properties * Quantitative analysis (disambiguation) * Quantitative verse, a metrical system in poetry * Statistics, also known as quantitative analysis ...
, formal, informal, published, and unpublished. MI data is gathered both internally and externally. Benefits that MI can bring are that it provides
customer In sales, commerce, and economics, a customer (sometimes known as a client, buyer, or purchaser) is the recipient of a good, service, product or an idea - obtained from a seller, vendor, or supplier via a financial transaction or exchan ...
,
competitor Competition is a rivalry where two or more parties strive for a common goal which cannot be shared: where one's gain is the other's loss (an example of which is a zero-sum game). Competition can arise between entities such as organisms, indivi ...
and market insights allowing
organizations An organization or organisation (Commonwealth English; see spelling differences), is an entity—such as a company, an institution, or an association—comprising one or more people and having a particular purpose. The word is derived from ...
to gain a
competitive advantage In business, a competitive advantage is an attribute that allows an organization to outperform its competitors. A competitive advantage may include access to natural resources, such as high-grade ores or a low-cost power source, highly skilled ...
in their
marketing strategies Marketing strategy allows organizations to focus limited resources on best opportunities to increase sales and achieve a competitive advantage in the market. Strategic marketing emerged in the 1970s/80s as a distinct field of study, further buil ...
. Issues that MI can bring is through acquiring
data In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
and information through illegal or unethical ways, it can lead to financial loss and government regulatory failures.


Background and Development

MI and its broader term, marketing intelligence, was first introduced in “Marketing Intelligence for Top Management” by Kelley, to provide information that was analyzed, reliable and consistent for an organization to better create
policies Policy is a deliberate system of guidelines to guide decisions and achieve rational outcomes. A policy is a statement of intent and is implemented as a procedure or protocol. Policies are generally adopted by a governance body within an orga ...
and make
business Business is the practice of making one's living or making money by producing or buying and selling products (such as goods and services). It is also "any activity or enterprise entered into for profit." Having a business name does not separ ...
decisions. 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 A technological revolution is a period in which one or more technologies is replaced by another novel technology in a short amount of time. It is an era of accelerated technological progress characterized by new innovations whose rapid applic ...
arises. Contributions to MI include professional organizations such as “Global Intelligence Alliance” and “the
Society of Competitive Intelligence Professionals Strategic and Competitive Intelligence Professionals (SCIP), formerly the Society of Competitive Intelligence Professionals, is a global non-profit best practice sharing community for experts from industry, academia, government, and non-profits ...
” (SCIP). These organizations have contributed both
empirical Empirical evidence for a proposition is evidence, i.e. what supports or counters this proposition, that is constituted by or accessible to sense experience or experimental procedure. Empirical evidence is of central importance to the sciences and ...
and theoretical research in an attempt to further define and understand MI. As research into MI comes from
scholars A scholar is a person who pursues academic and intellectual activities, particularly academics who apply their intellectualism into expertise in an area of study. A scholar can also be an academic, who works as a professor, teacher, or researche ...
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 Competitive intelligence (CI) is the process and forward-looking practices used in producing knowledge about the competitive environment to improve organizational performance. It involves the systematic collection and analysis of information from ...
,
business intelligence Business intelligence (BI) comprises the strategies and technologies used by enterprises for the data analysis and management of business information. Common functions of business intelligence technologies include reporting, online analytical ...
and strategic intelligence. MI to this current date continues to change to meet organizational requirements.


Framework

The implementation of MI varies depending on how
organizations An organization or organisation (Commonwealth English; see spelling differences), is an entity—such as a company, an institution, or an association—comprising one or more people and having a particular purpose. The word is derived from ...
perceive it. MI is defined as being composed of three main activities, these activities are Information Acquisition, the gathering of
marketing Marketing is the process of exploring, creating, and delivering value to meet the needs of a target market in terms of goods and services; potentially including selection of a target audience; selection of certain attributes or themes to emph ...
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. Frameworks can be flexible, however the basis that
organizations An organization or organisation (Commonwealth English; see spelling differences), is an entity—such as a company, an institution, or an association—comprising one or more people and having a particular purpose. The word is derived from ...
use to model the MI surrounds a four-step process, which are, collection, validation, processing and communication. Data mining techniques are used throughout the processes to aid in the gathering and analyzing of
data In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
and information retrieved. MI is a continuous process that organizations need to keep track of to improve their strategic and tactical
marketing Marketing is the process of exploring, creating, and delivering value to meet the needs of a target market in terms of goods and services; potentially including selection of a target audience; selection of certain attributes or themes to emph ...
planning. These processes target the three activities that MI is defined by. The model can be adjusted and adapted when required and can be implemented all at once or by sections.


Collection

Collection is the first step in the MI model, it involves the gathering of
data In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
and
information Information is an abstract concept that refers to that which has the power to inform. At the most fundamental level information pertains to the interpretation of that which may be sensed. Any natural process that is not completely random, ...
of a particular market sector. Such
data In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
and information can be gathered from external sources, such as other organisations and their market strategies, research institutes and business reports. Internal factors can include looking into current strategy processes and personal customer trends. It is estimated that 70% to 80% of
intelligence Intelligence has been defined in many ways: the capacity for abstraction, logic, understanding, self-awareness, learning, emotional knowledge, reasoning, planning, creativity, critical thinking, and problem-solving. More generally, it can ...
resides within
organizations An organization or organisation (Commonwealth English; see spelling differences), is an entity—such as a company, an institution, or an association—comprising one or more people and having a particular purpose. The word is derived from ...
employees or, internal MI network, as they are the team who gains information’s when interacting with
suppliers In commerce, a supply chain is a network of facilities that procure raw materials, transform them into intermediate goods and then final products to customers through a distribution system. It refers to the network of organizations, people, activ ...
, customers and other industry contacts. To involve
employees Employment is a relationship between two parties regulating the provision of paid labour services. Usually based on a contract, one party, the employer, which might be a corporation, a not-for-profit organization, a co-operative, or any ot ...
into an intelligence program to gain
data In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
and
information Information is an abstract concept that refers to that which has the power to inform. At the most fundamental level information pertains to the interpretation of that which may be sensed. Any natural process that is not completely random, ...
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 Communication (from la, communicare, meaning "to share" or "to be in relation with") is usually defined as the transmission of information. The term may also refer to the message communicated through such transmissions or the field of inqui ...
method to promote the intelligence program with employees such as using an
e-mail Electronic mail (email or e-mail) is a method of exchanging messages ("mail") between people using electronic devices. Email was thus conceived as the electronic (digital) version of, or counterpart to, mail, at a time when "mail" meant ...
system. A challenge that arises in the collection of
data In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
and information is the identification of relevant information, this is a result of organizations not clearly defining a market sector.


Validation

Validation is the second step in the MI model, this which can be referred to as data cleansing.The maintenance of good
data quality Data quality refers to the state of qualitative or quantitative pieces of information. There are many definitions of data quality, but data is generally considered high quality if it is "fit for tsintended uses in operations, decision making and ...
is important as
data In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
and information is being retrieved from many different sources.
Data In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
and
information Information is an abstract concept that refers to that which has the power to inform. At the most fundamental level information pertains to the interpretation of that which may be sensed. Any natural process that is not completely random, ...
obtained from sources can be dirty, meaning that it is incomplete, wrong, inappropriate, duplicated. This step will allow
data In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
and
information Information is an abstract concept that refers to that which has the power to inform. At the most fundamental level information pertains to the interpretation of that which may be sensed. Any natural process that is not completely random, ...
to be adjusted and understandable to the organization, furthermore it allows for consistency and compliance to be present. If
data quality Data quality refers to the state of qualitative or quantitative pieces of information. There are many definitions of data quality, but data is generally considered high quality if it is "fit for tsintended uses in operations, decision making and ...
is not maintained correctly it can lead to organizational losses with
revenue In accounting, revenue is the total amount of income generated by the sale of goods and services related to the primary operations of the business. Commercial revenue may also be referred to as sales or as turnover. Some companies receive rev ...
and governmental
regulation Regulation is the management of complex systems according to a set of rules and trends. In systems theory, these types of rules exist in various fields of biology and society, but the term has slightly different meanings according to context. ...
failures.


Method of Validation

Data cleansing is a complex process that involves several stages in order to get good
data quality Data quality refers to the state of qualitative or quantitative pieces of information. There are many definitions of data quality, but data is generally considered high quality if it is "fit for tsintended uses in operations, decision making and ...
for MI strategy use. Stages include defining the organization’s level of
data quality Data quality refers to the state of qualitative or quantitative pieces of information. There are many definitions of data quality, but data is generally considered high quality if it is "fit for tsintended uses in operations, decision making and ...
, detecting error from the data collected and then repairing the errors.The five stages of data cleansing are data analysis to identify errors, eliminating the errors, checking to ensure elimination of error are done appropriately, refreshing the data in the data warehouse and finally replacing the
dirty data Dirty data, also known as rogue data, are inaccurate, incomplete or inconsistent data, especially in a computer system or database. Dirty data can contain such mistakes as spelling or punctuation errors, incorrect data associated with a field, inco ...
with clean data.


Processing

Processing is the third step in the MI model. It involves the use of translating the clean data using organizational rules, modelling, logic and analysis to produce readable information, reports and spreadsheets that allows the organization to gain specified knowledge. The interpretation of data into readable information is difficult as it is complex, it requires proper technology and heavy commitment from a top organizational level to match data and information gained and align it to a marketing strategy.


Communication

Communication is the last step in the MI model. It involves the sharing, delivering and transmission of information gained from the processing step to figures in the organization who will apply it accordingly to the market strategy. As MI is a continuously changing, the communication of the MI strategy requires managers whom have expertise in the given market industry in order to determine the ongoing validity of the MI strategy and its implementation. In order to make the communication of the MI strategy as successful as possible, this process must be performed by every level of an organization, also known as the intelligence organization.


Intelligence Organization

Intelligence organization refers to the “people and information resources who make the market intelligence process happen”. The five elements of an intelligence organization are, MI leadership who manages and leads the MI process, a MI team, a portfolio of external information sources that is set up by the MI team, internal MI network made up of MI users and the MI user’s personal information source network. An intelligence organization element is made up of external and internal factors that allows for a continuous MI process.


Gathering market intelligence data

The gathering of MI data is different dependent on an organization’s financial capabilities. Sources of
data In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
and information is separated into qualitative,
quantitative Quantitative may refer to: * Quantitative research, scientific investigation of quantitative properties * Quantitative analysis (disambiguation) * Quantitative verse, a metrical system in poetry * Statistics, also known as quantitative analysis ...
, formal, informal, published and unpublished. With such sources being retrieved both internally and externally from the organization. It involves using
search engines A search engine is a software system designed to carry out web searches. They search the World Wide Web in a systematic way for particular information specified in a textual web search query. The search results are generally presented in ...
and corporate web sites to see competitor’s strategies, identifying business trends through reputable publications and existing customer clientele. Organizations use different systems to gather MI, one system is that is used is Open-source Intelligence system.


Internal intelligence gathering

Sources of internal intelligence gathering is include but is not limited to, gathering
data In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
from customers, manufacturers, through
research and development Research and development (R&D or R+D), known in Europe as research and technological development (RTD), is the set of innovative activities undertaken by corporations or governments in developing new services or products, and improving existi ...
(R&D),
employees Employment is a relationship between two parties regulating the provision of paid labour services. Usually based on a contract, one party, the employer, which might be a corporation, a not-for-profit organization, a co-operative, or any ot ...
, also known as salesforce, physical evidence, sales quotes, sales records,
trade shows A trade fair, also known as trade show, trade exhibition, or trade exposition, is an exhibition organized so that companies in a specific industry can showcase and demonstrate their latest products and services, meet with industry partners and cu ...
and new hires. These
data sources In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpreted. ...
were ranked by organizations on a scale measuring five for being very important to one being not important. It was founded that customers and manufacturers and R&D are the most important to organizations with one hundred percent of organizations ranking these data sources with the number four or higher,. It shows that in the process of collection and gathering MI
data In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
and information, these
data sources In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpreted. ...
brought the most
value Value or values may refer to: Ethics and social * Value (ethics) wherein said concept may be construed as treating actions themselves as abstract objects, associating value to them ** Values (Western philosophy) expands the notion of value beyo ...
to organizations.


External intelligence gathering

Sources of external intelligence gathering is included but is not limited to, gathering
data In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
from client meetings, dealers/distributors, customers, business associates,
market research Market research is an organized effort to gather information about target markets and customers: know about them, starting with who they are. It is an important component of business strategy and a major factor in maintaining competitiveness. Ma ...
projects, suppliers, online services, periodicals and government publications. These
data sources In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpreted. ...
were compared on the same scale as internal intelligence gathering sources, with results showing that intelligence gathered through client meetings being the most important to organizations, with one hundred percent of organizations ranking this data source with the number four or higher.


Information systems intelligence gathering

Marketing information systems allow for organizations to continuously acquire, generate, and maintain external and internal information. They are systems that make use of
artificial intelligence Artificial intelligence (AI) is intelligence—perceiving, synthesizing, and inferring information—demonstrated by machines, as opposed to intelligence displayed by animals and humans. Example tasks in which this is done include speech ...
(AI) technology to aid in the planning of
strategic Strategy (from Greek στρατηγία ''stratēgia'', "art of troop leader; office of general, command, generalship") is a general plan to achieve one or more long-term or overall goals under conditions of uncertainty. In the sense of the "art ...
and tactical
marketing strategy Marketing strategy allows organizations to focus limited resources on best opportunities to increase sales and achieve a competitive advantage in the market. Strategic marketing emerged in the 1970s/80s as a distinct field of study, further buil ...
of MI but also share marketing expertise.


Open-source Intelligence (OSINT)

Open-source intelligence is a predominant form of MI gathering that organizations employ. OSINT is defined as the scanning, finding, gathering, exploitation, validation, analysis, and sharing with intelligence-seeking clients of publicly available print and digital/electronic
data In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
from
unclassified Classified information is material that a government body deems to be sensitive information that must be protected. Access is restricted by law or regulation to particular groups of people with the necessary security clearance and need to know, ...
, non-secret, and
grey literature Grey literature (or gray literature) is materials and research produced by organizations outside of the traditional commercial or academic publishing and distribution channels. Common grey literature publication types include reports ( annual, r ...
. It is frequently used as its system is user friendly, its inexpensive and that it processes an abundant amount of
raw materials A raw material, also known as a feedstock, unprocessed material, or primary commodity, is a basic material that is used to produce goods, finished goods, energy, or intermediate materials that are feedstock for future finished products. As feeds ...
that can be further processed.


Impacts of market intelligence

Using MI can bring to organizations both benefits and issues depending on how MI is acquired, maintained, and implemented. Benefits that MI can bring includes but is not limited to gaining
competitive advantage In business, a competitive advantage is an attribute that allows an organization to outperform its competitors. A competitive advantage may include access to natural resources, such as high-grade ores or a low-cost power source, highly skilled ...
in their
marketing strategies Marketing strategy allows organizations to focus limited resources on best opportunities to increase sales and achieve a competitive advantage in the market. Strategic marketing emerged in the 1970s/80s as a distinct field of study, further buil ...
. Issues that MI can bring can include but is not limited to, financial losses and government regulatory failures.


Issues

There are issues that arises in the process of acquiring MI data and information and the implementation of an organizations
marketing strategy Marketing strategy allows organizations to focus limited resources on best opportunities to increase sales and achieve a competitive advantage in the market. Strategic marketing emerged in the 1970s/80s as a distinct field of study, further buil ...
. Issues such as the acquiring intelligence unethically and illegally can lead to failures with government regulations, also, if
dirty data Dirty data, also known as rogue data, are inaccurate, incomplete or inconsistent data, especially in a computer system or database. Dirty data can contain such mistakes as spelling or punctuation errors, incorrect data associated with a field, inco ...
is not properly cleansed and problems aren’t mitigated or resolved can lead to a range of negative impacts that can result in financial and reputational losses to the organization.


Legality and ethics

An issue that can arise is the unethical and illegal collection of
data In the pursuit of knowledge, data (; ) is a collection of discrete values that convey information, describing quantity, quality, fact, statistics, other basic units of meaning, or simply sequences of symbols that may be further interpret ...
and information. Organizations can collect data for MI illegally or unethically to try to gain
competitive advantage In business, a competitive advantage is an attribute that allows an organization to outperform its competitors. A competitive advantage may include access to natural resources, such as high-grade ores or a low-cost power source, highly skilled ...
s; this is known as
industrial espionage Industrial espionage, economic espionage, corporate spying, or corporate espionage is a form of espionage conducted for commercial purposes instead of purely national security. While political espionage is conducted or orchestrated by governme ...
. An example of illegal MI collection practice is when
British Airways British Airways (BA) is the flag carrier airline of the United Kingdom. It is headquartered in London, England, near its main hub at Heathrow Airport. The airline is the second largest UK-based carrier, based on fleet size and passengers ...
breached the Data Protect Act 1984 through accessing Virgin’s confidential flight details. A standard of conduct was developed by the non-for-profit organization
Society of Competitive Intelligence Professionals Strategic and Competitive Intelligence Professionals (SCIP), formerly the Society of Competitive Intelligence Professionals, is a global non-profit best practice sharing community for experts from industry, academia, government, and non-profits ...
, creating a code of ethics that can be adhered to by organizations when collecting market intelligence, to prevent the illegal and unethical collection of data and information.


Dirty Data

Dirty data Dirty data, also known as rogue data, are inaccurate, incomplete or inconsistent data, especially in a computer system or database. Dirty data can contain such mistakes as spelling or punctuation errors, incorrect data associated with a field, inco ...
that is collected needs to be cleansed to maintain good
data quality Data quality refers to the state of qualitative or quantitative pieces of information. There are many definitions of data quality, but data is generally considered high quality if it is "fit for tsintended uses in operations, decision making and ...
. Challenges that arise in data cleansing is that there is a large volume of data being received leading to organizations being faced with many risks of failure to detect
dirty data Dirty data, also known as rogue data, are inaccurate, incomplete or inconsistent data, especially in a computer system or database. Dirty data can contain such mistakes as spelling or punctuation errors, incorrect data associated with a field, inco ...
being processed through. If data quality is not managed properly, it can result in financial losses, inefficient implementation of MI strategies and failure to comply with government regulations. A reason for financial loss is due
operational costs Operating costs or operational costs, are the expenses which are related to the operation of a business, or to the operation of a device, component, piece of equipment or facility. They are the cost of resources used by an organization just to main ...
, as there is an increase in resources and time spent to identify and fix the
dirty data Dirty data, also known as rogue data, are inaccurate, incomplete or inconsistent data, especially in a computer system or database. Dirty data can contain such mistakes as spelling or punctuation errors, incorrect data associated with a field, inco ...
.


Benefits

MI processes have been used in many organization’s strategic market planning, however, there are still difficulties in what the hard and soft benefits in using a MI process for an organization. The benefits of a successful MI process can be sectioned into three categories, better and faster decisions, time and cost savings and organizational learning and new ideas, however, overall, it can improve profitability and the competitiveness of an organization. The competitiveness of an organization increases as with more MI gathered it'll provide a way for organizations to innovate through improving current methods and increasing the ability to find and create new products.


References

{{DEFAULTSORT:Market intelligence Intelligence gathering disciplines Business intelligence