Before we dive deeper in understanding the common pitfalls of market intelligence, it is important to have a mutual comprehension of what market intelligence is. Market intelligence, as its name implies, is simply the intelligence – or information – about a business’s particular market. For example, the geographic location of a business, the particular demographics of a consumer base, what is driving people, companies or organisations to consume your products or services? Or any other information that’s relevant to a company’s market, is market intelligence. As you can see it is an important part of your business!
The importance of market intelligence
To gain and retain a strong position in the market, it is important your company is aware of what is going on in the market. Gathering market intelligence about your target audience, your customers, the market you are entering… is crucial for your success. You need to be aware of how the market is changing and how this change will affect your business.
Today this research and analysis is something which mainly happens on a qualitative level. However this poses some issues. How will you assure the insights you are using are really the ones you should be using and basing your decisions on? Will these insights stay? When are they changing? … Exactly, a lot of questions. Our experience with companies today regards to the way they gain or have gained intelligence about their markets and products, is that the same intelligence from 10 years ago is still a big chunk of the intelligence they are using today. We thought it would be great to sum up some of the pitfalls we encounter and some solutions on how to enhance that information gathering and analyzing process.
Common pitfalls & solutions in market intelligence :
- Missing focus: Are you asking the right questions? Companies often follow a standard template which is constructed of long lasting generalized questions. Optimize your questions by really looking at what your company can benefit from.
- Which data: While everything gets documented more than ever before, we see companies struggle with getting the right and relevant data for their business. How will you dig down through that enormous amount of data which is out there? Advanced predictive analytics that help you match your data with the big data out there can help you. Discover the technologies out there!
- Wrong sample: Asking the right questions to the wrong respondents will yield irrelevant results. Make sure you have got that segmentation right. Really dig deeper in what industries/organizations, which people within those industries/organizations you should talk to. Don’t just listen to your gut feeling. Try to look for data that can assure your assumptions and rule out judgement.
- Wrong research tool: Many companies start the research process by saying, “I want to do a survey” or “I want to do a focus group”. Instead, consider which research tool will best accomplish your goals within your budget. Sometimes a combination of methods works best.
- Insufficient Sample Size: Be careful about drawing inappropriate conclusions from research. Qualitative research is excellent for probing and delving into details, but it’s not good for extrapolating to large populations. Quantitative research must be based on a random sample that is large enough for extrapolation.
- Overspending: Shopping around for market data can become expensive, without the knowledge of which data exactly you are looking for, this can become a costly affair. Use advanced predictive analytical techniques which can help you select the relevant data for you.
- Improper Analysis: It’s easy to look at the results of market research through biased eyes. (We have talked about this in one of our recent webinars and wrote an e-book regards to this topic.) This is especially tricky with qualitative research. Choose the right analytical tools and look for statistically significant findings from quantitative research and common key insights from qualitative.
Continous scrutiny of your market
One last thing we really want to stress is that market research is never over. It is a wrong impression that your findings today will be relevant tomorrow. So continuous scrutiny and eyes on the market is essential. We would advise to have a look at your market drivers, at least once a year, or whenever there is a factual occasion which triggers to have another look at your market environment and to revise your assumptions and insights you have today.
Curious to see how we tackle this and what our customers think? Watch this webinar with Volvo Construction Equipment, where they talk about their experience on how advanced predictive analytics provided them insights and tricks to get a better understanding of their market intelligence. Or curious to check it out yourself? Sign up for a free trial with our advanced predictive analytics software!