Competitive Intelligence: An Insiders’ Guide

Knowledge is power, particularly when it comes to outsmarting the competition. Remember that famous line from the movie The Godfather? “Keep your friends close and your enemies closer.” That’s never been more evident a need than with rival companies who are vying for the attention of your customers. Having the right information at your fingertips drives an enterprise forward and helps solidify a business strategy with a clear advantage.

Competitive Intelligence by definition is the collection, analyzing and distributing of information about products, customers, competitors and anything else useful to executives and managers making key decisions within an organization. It’s about stepping out of a person’s immediate surroundings, to look for clues that will help gain insight into competitive challenges of the external business environment. When you can’t see the forest for the trees that means it’s time to step outside your world and look around.

The formal practice of gaining competitive intelligence really took off in the 1970s here in the U.S. In 1972, the Society of Competitive Intelligence Professionals (SCIP) was formed and grew to 6,000 members worldwide. It later merged with Frost & Sullivan and was renamed “Strategic & Competitive Intelligence Professionals.”

The business of competitive intelligence is big business within major corporate entities. In fact, many have formed their own CI unities, to focus exclusively on competitive threats and analyze potential opportunities in a marketplace.

SWOT Analysis

A gentleman named Albert Humphrey first introduced this planning method used to evaluate strengths, weaknesses, opportunities and threats related to a project or venture. It can be used to look deeper at a product, place, industry or person for that matter. In terms of gaining competitive intelligence, it’s a great place to start to get a blueprint of the competitive landscape and weight your company’s advantages against others in a similar field. Here’s a breakdown of the SWOT Analysis, step by step:

Strengths — What characteristics of the project or business give it a clear advantage over others?

Weaknesses — What are the disadvantages?

Opportunities — Where can the company or product make the most impact?

Threats — What would keep it from succeeding?

When doing competitor analysis, many companies build out detailed profiles of their competitors’ strengths and weaknesses using a SWOT analysis. This also helps you create a more powerful message for your brand.

Develop a Network

When collecting information on competitors, it helps to have as many eyes and ears as possible positioned outside your office walls. Suppliers, your customers, members of the trade press and consultants can often be great sources for gathering competitive intelligence. Your competitors’ websites are also another great place to mine data. Often competitors will make public their customers, new talent they are hiring, and hints about where they are headed in the future. Other resources include Dun & Bradstreet, which provides information on companies relevant to your business through a fee based, searchable database of companies in the United States and around the world.

You can also learn a great deal by profiling top executives in competing companies. The Myers & Briggs Foundation has assessments designed to measure psychological preferences in how people perceive the world and make decisions. Many HR departments use these tests before making a new hire. Similarly, companies can also use this information to gain critical insight on competitors; particularly key management. If you know whether a person is an extrovert or introvert, you are better able to gauge he or she’s next move better. For example, extroverts are action oriented and would move quickly on critical business decisions. Introverts are thought oriented and would likely reflect longer on such a decision.

Competitive Intelligence in the Digital World

If you’re on top of your SEO strategy and you should be, there are a number of tools available to help you fine-tune your SEO campaigns and gain a competitive advantage. A product called Keyword Spy is one such tool. Let’s say you have a garment company and one of your keywords is Capri pant. Enter that keyword phrase into the search box, select the radio button for keywords, click the search button and once the data is populated select the Organic Competitors tab. This can help you identify competitors you weren’t aware of, and let’s you see how the competition differs based on different keywords.

If you want to compare your website and see if it’s optimized better than the competition there’s a tool called Site Comparison. You can literally take your home page, and a competitors home page and evaluate who is going to rank hire in organic searches and why. Site Comparison evaluates things like body text, code-to-content ratio, keyword density, meta tags, headlines, internal and outgoing links. You can see first hand where a competitor has optimized a keyword better and is outperforming your company with their SEO strategy.

Focus Groups

Focus groups are a type of qualitative research where you get a group of people in a room and ask them questions related to their perceptions, opinions, beliefs and attitudes towards products, other companies, advertisements and other things you’d like to know. When collecting competitor intelligence, focus groups can be extremely useful for getting to the heart of what you really need to know. Say you want to understand how to get someone using a competitor’s products, to switch to yours. Acquiring new customers can be expensive, so you need to know if it’s worth the investment. You basically ask them what would it take to switch from that company to yours. In the process you begin to understand how loyal customers are, and how strongly they believe in existing habits and attitudes.

Brand positioning is another thing you can measure in focus groups. How strongly does your brand or your competitor’s brand resonate within a certain group? It’s the underlying reason people buy one over the other, so you want to make sure your branding is firm in a customer’s mind.

Perceptual Maps

Perceptual maps are a handy tool to analyze how customers view concepts, products or brands. Basically it will tell you how competitive products or brands compare to yours based on attributes — features and benefits. In doing so, you will also understand which attributes are most important to customers. You’ll ask people to place products or brands along an attribute line, according to where they see it fits. Once they complete the map, you’re able to probe a little deeper.

Brand Attitudes

This method uses quantitative questions and scales as a starting point for open-ended questions that allow you to understand motivations and behavior. For example, you might ask on a sliding scale from one to 10, 10 means I completely agree, if changing brands is difficult.

A Short and Long Term Goal

Competitive Intelligence should be an ongoing practice for any business as the landscape is continually changing. Many companies take a reactive stance to it as a result of a loss of market share, angry customers, or a new product introduction tanking. Once you’ve completely lost a customer’s confidence, it’s an uphill battle trying to win it back. That’s why competitive intelligence should become a way of life for everyone within the corporation. It’s not just for marketing or sales staff — it should be accessible for everyone who needs it.

While there’s no such thing as a crystal ball when it comes to competitive intelligence, it is a great indicator of what might be coming down the road in the way of competitive threats, and possible opportunities. In order to do it right, companies have to see outside themselves and what they know to be true to gain real wisdom.