Competitive Intelligence 101. Staying Ahead of the Competition

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1 Competitive Intelligence 101 Staying Ahead of the Competition

2 Competitive intelligence is a systematic program for gathering and analyzing information about your competitors' activities and general business trends to further your own company's goals. If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle

3 How can CI help your business? It s Monday morning time for the weekly senior staff meeting and as you walk in, you re greeted by several of your colleagues Don t you just hate Mondays? Or, better yet, surprises that aren t good?! Well, competitive intelligence (CI) decreases the chances of being surprised and caught off-guard and it also creates an environment where everyone knows that the CI process is in place so instead of point and blame you will have more look what we found see we re helping! But more importantly, when CI is working, you are able to walk into those weekly meetings and tell your colleagues what s coming so everyone can discuss the right strategies and tactics for your company s response! The Process for Success As the chart shows, you start with a plan. And that starts with a need which drives a plan. Step 1: Plan What do you want to know and why? Be sure to focus on actionable findings rather than nice to know information. Where can you find quality data? You want agreement across the organization on this so that you can avoid accusations about the accuracy of the source of the data gathered. This also helps reduce time and costs associated with gathering data because you can focus on those agreed upon sources rather than searching the entire Internet. Who is responsible for gathering and analyzing? All tasks must have owners and those owners must have timelines and

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5 objectives. Ownership in a CI program, like any other activity, is key to progress and success. How will the recommendations be developed and shared? What you want the CI program to force is discussion, informed decision making and action. So addressing this question right from the start is crucial because that s when enthusiasm is highest and it will be easier to gain commitments. Test. Measure. Analyze. Modify. Repeat. This is a mantra of mine and I included it here because once recommendations have been made, you want to take action in a way that will show success (or failure). This is a learning process and it will evolve over time based on the organization s ability to produce successful outcomes. So, instead of making a decision and rolling it out to everyone test it with a smaller group and see if your decision was wise. Questions You Need to Answer Here are some basic categories and questions within those categories that you should be able to answer so that you can make better informed decisions about your business strategies. Company. Target audiences. Products and services. Pricing. Distribution. Promotion. Human resources. Company. What is the mission and vision of your competitor?

6 What has been their historical performance? Steady growth? Flat? A rollercoaster ride of profits and losses? Have they won any awards or recognition? Achieved any remarkable milestones? How is the organization structured? What is their organizational chart? Who are the leaders and what experience do they bring to the table? Are they aggressive innovators or slow-to-change conservatives? What are the goals and objectives for the business? What are their key strategies? What are their key metrics such as number of employees, annual revenues, and number of locations? This information provides a solid foundation for you to evaluate the overall business. For example, if the leadership team has been with the business for their entire careers and have exhibited a slow-to-change approach to operations that includes coming late to market with new products and services, you might surmise that you can beat them to market and capture larger market share with new products and services. Or if they are a fast growth oriented business based on known goals and objectives, and they have typically achieved success through acquisition, you might want to consider how acquisition might help your business remain competitive. Target Audience Who do they target and why? Be as specific as possible about their audience what are their key characteristics, locations, behaviors, buying process? If targeting businesses, who are the major client for the competitor? If targeting consumers, who are their top segments? What unique features and benefits do they offer the audience? How many customers do they have and what s their growth rate over the past years? This information can help drive key decisions in terms of audience selection, opportunity within the market for growth and more.

7 Products and Services. You will want to create a full list of all products and services including features, benefits, sales (Total Annual Sales and Percentage of Total Sales), Year Launched, Stage in Product Lifecycle (New, Growth, Mature, Lagging). You also want to focus on the strengths and weaknesses of the offerings specifically how they compare with your offerings for your audiences. Obviously this helps you understand product differentiation which is key for messaging and offers that can be brought to your audience through marketing and sales campaigns. But just as important, this information addresses a great many of the concerns voiced in typical staff meetings for example, the competition s Product A appears to be just like your own Product Z until you take a hard look at the features. Pricing. What is their pricing strategy are they charging premium pricing as part of a skimming strategy? Or are they a low price leader? How do they use discounts, promotions, financing and guarantees? Gather this information for all products and services, and keep track of this information over time so you can see if any patterns develop. Distribution. How do they bring their products and services into the hands of the end user? Do they sell direct or through resellers? What type of coverage do they have in their target geographic market? Are their products and services available to 100% of their target audience regardless of location? Or do they have markets where they are stronger/ weaker than others? If they use channel partners, who are they and what are their reputations?

8 Promotion. How much do they spend on promotion and advertising? What unique selling points are stressed? What products and services do they feature? What is their brand strategy? What media do they use? Is their website more brochure-ware than for lead capturing or e-commerce? What is their social media and content marketing strategy? Sign up for their newsletters and webinars and this allows you to see what they send, when they send it as well as providing you with insight into messaging and offers. Call their call centers and see how the experience is but have a specific mission and process for secret shopping so you can perform the call several times and see how different operators respond to your call. Human Resources. What types of positions do they hire and how do their job descriptions match with similar positions at your firm? Do they hire experienced professionals at high salaries or less experienced professionals at lower salaries? Do they promote from within or hire outside expertise? What are their training and development processes? How do they evaluate and motivate staff? Note: Monitoring HR activity can also shed a great deal of insight into planned growth and product innovation. For example, I once monitored a business for a client that started to hire a significant number of entry level sales people in a specific region and it turned out the reason was planned expansion. In another instance, increased hiring was due to turn-over which had a negative impact on customer satisfaction which meant my client had a valuable opportunity to attract new customers. Who is responsible for gathering and analyzing the data? In the above scenario, you will want to involve your C-level leaders in the

9 process so they can identify the specific questions that need to be answered, identify the quality sources of information, and assign a staff member to gather the data. This is important for a number of reasons. First, you get the content area expert involved which increases the potential for gathering the highest quality data. For example, I am a pretty smart guy but I am not a financial expert so having a member of the finance department grab key financial metrics increases the potential for greater overall success. Second, this approach makes the CI program a companywide program rather than a marketing program. This increases the visibility and perceived value of the program which means it will enjoy greater participation and acceptance. Third, this approach requires the content area experts to layout their own plan for analyzing data and putting forth practical recommendations for improvement. Right from the start, they are committing to a process for gathering the information they need to make better decisions in their area of responsibility. Step 2: Collecting Data The CI Team should identify and agree to specific internal and external sources of quality data. For examples, please refer to the chart below. Then, the CI Team should develop a specific processes for gathering and storing the data so it can be easily accessed and shared so that analysis can be performed. For many, starting internally offers a fast start to gathering quality data because of the number of employees that had extensive experience in the industry some of whom have worked for the competition and others that had contacts that can be contacted for interviews. Remember to interview front-line staff in order to learn what they are hearing from prospective and current clients. This gave you valuable data into what is being said in the market and what is being sought after by your target audience. Next, the external human sources such as our customers, research firms,

10 consultants, industry analysts, government employees at the state and federal levels, suppliers anyone that is involved in your industry that could offer you valuable insight into what is going on with your competitors. As you work your way through Internal and External Human Sources, remember to capture any documents that add value to your efforts. For example, your current employees that previously worked for the competition might have information that they can share without violating any laws or ethical rules your organization follows. Or, they might have documents that were distributed to the public by the competition at conferences. LIST OF SOURCES Hoover Corporate Websites Social Media including CEO Blogs Personal Websites and Social Media of Corporate Leadership and Key staff Google Alerts LinkedIn Twitter Syndicated Research Step 3 Analyze Step 4: Report I listed these two together because, to be honest, the analysis is performed by the content area expert based on their original commitment at the start of the CI Program. As for reporting, I would suggest that you either make this part of the weekly leadership meetings or create a monthly CI Leadership Team meeting that reports on the findings as well as decides on appropriate action steps that can be tested, measured, analyzed, modified and repeated (See Step 5). What you don t want to have happen is a meeting that simply allows the

11 To Support CI Efforts DWS Associates has developed a competitive intelligence software application Intellicomp Intellicomp CIS (Competitive Intelligence Software) is an information management system designed to hold a wide spectrum of strategic and tactical information about your competitors and your plans and programs for dealing with the competition. It has an easy-to-use interface that provides access to all your competitive information in a straight-forward manner. The system provides storage and access to competitive data that is easily accessible by management, finance, sales, product development, manufacturing, marketing, etc. Intellicomp provides one location to store, analyze and access information about your competitors. With one centralized repository, you ll be able to consolidate the competitive knowledge of all employees and make that information available throughout the organization. The application can be run from local servers or the cloud depending on your management information capabilities and systems. The application can be customized for your specific industry and competitive situation. To learn more about the system and pricing, visit our website at: About DWS Associates Founded in 1982, DWS Associates is a full service marketing firm that develops and implements multi-channel marketing programs for organizations targeting business-to-consumer and business-to-business audiences in global markets. Our focus is on data-driven, innovative lead generation, lead nurturing, retention, and referral programs that attract, engage and retain profitable customers. Our staff is highly experienced in market research, competitive intelligence, business intelligence and analytics, strategic planning and campaign management - so we help you increase sales

12 and marketing performance while building strong, unique, differentiated brands. About the Author: Dudley Stevenson, founder and CEO of DWS Associates, has over thirtyfive years experience in consumer marketing, business-to-business marketing, and direct marketing, including developing, planning, and implementing go-to-market strategies. He's also the author of "Marketing Direct: Breaking Through The Clutter." Working with organizations ranging from start-ups to Fortune 100 companies, he and his team have helped clients such as IBM, SAS Institute, Sony, Neiman Marcus, Arizona Highways, Marshall Field & Co., Mrs. Field s, UNICEF, SSA Global Technologies, Hartmarx, and Patagonia implement successful direct marketing programs. A longtime member of the Direct Marketing Association and the American Marketing Association, Stevenson is also a sought-after speaker. He s given hundreds of presentations and workshops on marketing and direct marketing. His Marketing Planning 101 workshop alone has reached more than sixty thousand marketing and sales professionals.