Marketers, keep your friends close and your competitors closer because if competitive intelligence (CI) were a course, most of you would fail it miserably. And that’s risky!
A recent IBM study suggests that although 80 percent of CMOs conduct market research and competitive benchmarking to make strategic decisions,too many rely on traditional (manual) practices that only offer little insights.
Instead of knowing what consumers want and how to market those products with great content and creative ads, CMOs need to do a better job at managing risk and showing their competitors who is boss. But to do so, marketing teams need structured goals, CI initiatives and tools to produce action-driven competitive intelligence that supports marketing strategies and investment decisions.
Here are five reasons why most marketers risk getting an ‘F’ in competitive intelligence:
Recommended for YouWebcast: Winning with Data: Drive Leads & Marketing ROI across All Channels & Campaigns
1) Marketing Automation Software Misses the Mark
Sure! Marketing automation makes life easy for marketers. Ever since its development, marketers can sit down, put their feet up, and let software automate the process of generating reports, nurturing contacts, and scoring leads.
We all know marketing automation software like Marketo, HubSpot, or Eloqua can track a wide range of digital initiatives with beautifully colored analytics to visualize online marketing tactics. But how does this minimize risk or maximize awareness against competitor moves? What about decrypting the numbers, processing competitive information, such as shifts in competitor claims, comparing pricing strategies, and threatening partnerships that jeopardize sales?
Although robust, marketing automation software creates blind spots hiding “what’s next?” This kind of software reveals very little insight about company risks, competitor tactics and market positioning strategies. Once marketers realize this, then and only then, will they wake up and start taking notes!
2) Competitor Analysis is Periodic vs. Continuous
Too many marketers set-it-and-forget-it!
How can one expect a competitive analysis to help drive decisions when most companies 1) outsource competitor profiling and 2) don’t do it regularly? Data changes way too often and competitors always have something up their sleeve. A periodic competitor review may have worked fifteen years ago, but it’s time marketers get adjusted to present day times. Marketers must leverage new tools that proactively track competitor marketing activities, potential partnerships and public relations schemes across the Internet realm. Without this kind of 4D tracking, competitors will slowly steal market share or capture attractive opportunities. This is a risk every company can’t afford to take.
With so many online sources like YouTube, Twitter, blogs, customer review sites, and even market research databases, it takes lots of time and way too many interns to process information. No wonder why marketers piecemeal competitor monitoring and call it a day.
3) Marketers Worry about What is Already Known
No one likes yesterday’s news! Neither should marketers, especially when sales reps bring in updates like newfound gold. By the time marketers realize that their competitors are starting a threatening email campaign, marketing initiative or a new product, guess what? It’s too late!
Many marketers fail at detecting cues that predict their next strategic move. Anticipation is a tremendous gain from conducting competitive intelligence, but it doesn’t come from monitoring things like competitor press releases or annual reports. It comes from paying attention to details such as sneaky website updates, striking price changes, or rumors of offices popping up in a new market. The human eye can’t see much of this activity without technology so it’s easy to make blurred decisions and miss attractive opportunities for growth.
4) Focus is ROI, Not Competitors
To give marketers some credit, a recent study from Fournaise Marketing Group that surveyed 1,200 CEOs found that 75% of them expect their marketing group to be purely ROI focused. Focusing on ROI is great marketers! But what about targeting segments outside your comfort zone?
Marketers tend to focus more on maintaining their existing customer base satisfied, yet they fail at going after new market share. Since efforts to gain market share can be risky and affect profitability, many marketers prefer to focus on increasing their customer lifetime value. Failing to consider competitor threats by monitoring the competition and industry; however, can limit market share tremendously, affecting growth.
Instead, marketers should consider using a 3-tier strategy that considers overall ROI (1st place), an increase in customer value (2nd place), and continuous competitor monitoring to bring in new revenue streams (3rd place).
5) Marketers Confuse CI with Market Research
Marketers that spend too much time on market research aren’t necessarily conducting competitive intelligence. These terms are both two different disciplines.
Market research is mostly done when looking to identify the market need, size, and growth potential. It considers competitors and potential substitutes, but not their underlying intentions or strategic tactics. The information is typically gathered by surveying prospects or customers in order to gather their opinion and perspectives on their needs, problems, and desires.
On the other hand, competitive intelligence studies the “not so obvious” to predict market and industry trends to avoid risk against aggressive or competitors who are silent killers. To be truly effective at CI, indicative cues must be gathered by following patent reports, competitor websites, job boards, and social media such as LinkedIn profiles, online discussions, etc.
What can marketers do differently to get an ‘A’ in competitive intelligence? Here are three things marketers can begin working on:
1) Use CI software to automate competitor monitoring
In order to create a competitive marketing and branding strategy, marketers must be aware of the competitions’ practices, services, products, and their position. A proactive monitoring system must keep up with every aspect of the competition and industry. It’s necessary to keep a sticky eye on various online sources to uncover pricing strategy, branding initiatives, customers disappointments, new partnerships, along with other important competitive information.
However, as easy as it may sound, having to search, monitor, process and interpret new-found information from different sources online can be overwhelming without an automatic technology.
A recent Citibank study surveyed 749 business owners from around the country. Roughly 60% of them said they plan to increase their online marketing efforts on their own websites, while 40% said they plan to include social networking to gain new clients and increase their public relations activities.
It’s absolutely essential that CMOs begin to leverage competitive intelligence tools to process information, support strategic know-how and marketing investment decisions.
2) Take time to analyze the details
The more time marketers spend snooping around competitor’s websites, social media and other websites, the less time they have to analyze the information found. In other words, the information process takes a longer cycle to make the information found turned into actionable intelligence. Marketers must find ways to have information pushed to them via emails or alerts. Otherwise, they’ll continue to have a minimal approach to competitive intelligence risking many areas of their organization.
The trick is to empower marketers to devote their time reading and analyzing valuable competitive information to plan effective and timely initiatives. Just like marketing automation gives marketers great analytics, competitor monitoring tools help today’s marketers manage risk and compete better with information already available online.
3) Communicate your findings
After obtaining competitive intelligence, marketers should consider an efficient way to continuously report and share their findings. Sharing the information processed creates actionable intelligence after other stakeholders put the information into context in their roles. This is sure to help other departments compete better everyday.
For instance, if by looking through LinkedIn profiles and discussion groups, marketers find that the competition has a new hiring/recruiting strategy, why not share the report with the human resources department? Technology helps information flow throughout the organization in an easy way so that the whole organization can score an ‘A’ in competitive intelligence.