For those new to marketing, it is easy to get confused with terms such as competitive intelligence and market intelligence. Though these two jargon are often used interchangeably, and there are slight overlaps, these terms are very different concepts. It is crucial to appreciate their differences, especially when you are in the process of chalking out business strategies or choosing an apt framework to derive insights.
This post aims to drive clarity between these two terms and highlight how they are different. So, let us begin.
Firstly, what is competitive intelligence?
Competitive intelligence is a highly specific idea that solely focuses on your competitor businesses in the same target market. It concerns not just the broader industry your competition is a part of but also the narrower target market. Competitive intelligence tools are used to gain insights into the strengths, weaknesses, and intentions of your biggest business rivals in the same scope of that narrower market.
What is market intelligence?
Contrary to the specific approach of competitive intelligence, market intelligence deals with a broader market and offers a comprehensive understanding of your business and its surrounding external landscape. It revolves around trends within an industry, identifying patterns, and interpreting or gauging their implications. Market intelligence sets the foundation for businesses in the same market to compete.
Both competitive and market intelligence are critical to creating winning marketing strategies to identify, seize, and maximize opportunities and develop business resilience. However, they are majorly different.
Competitive intelligence vs. market intelligence – aims and goals
The first and primary difference between these concepts lies in their goals. While the goal of competitive intelligence is to fetch insights into your biggest competitors, market intelligence is all about responding or appealing to your customers via smarter and faster means.
Competitive intelligence aims to help your business mitigate probable risks posed by rivals and even empowers you to make the most of their capabilities and weaknesses. You can leverage this to discover fresh possibilities by monitoring the progress of your competitors and even detect potential threats from them. It offers insights to assist in comparing and benchmarking your business growth against that of your rivals. Moreover, competitive intelligence can also help you forecast competitor moves, based on which you can chart out strategies to outperform them in specific markets or categories.
On the other hand, market intelligence helps you develop effective strategies to penetrate the market or can even assist you in deciding whether you should enter a new market. It offers insights to develop diversification policies for products and services by boosting your customer-centricity. You can improve your customer loyalty and retention by spotting unexpressed consumer demands by using market intelligence. This can prevent poor business investments, ensure appropriate allocation of resources, and streamline business operations.
Competitive intelligence vs. market intelligence – focus on data
The next major difference between competitive and market intelligence is in the data points they primarily focus on.
Competitive intelligence focuses on data points related to acquisitions, investments, and funding sources of your competitors. It also revolves around their business tactics and strategies, as well as their organizational data such as employment opportunities, core teams, work culture, hierarchical changes in the organization, etc.
On the other hand, market intelligence focuses on insights related to aspects such as customer behavior, brand awareness, brand preference, customer complaints and concerns, and even market segmentation. Market-related data such as trends, size and share, geopolitical and technological trends and impacts, new market players, and possible disruptors, are also taken into account. It also focuses on data related to products, such as pricing models, innovation, promotions, and product differentiation information.
Similarities between the two
Though competitive intelligence and market intelligence broadly vary in terms of their data focuses and objectives, they are somewhat similar in terms of their data sources. In other words, in many cases, the internal and external sources of data tend to overlap for both these kinds of intelligence.
External data sources for both range from syndicated contributors, research agencies, and industry reports to press reports and social media platforms. Whereas project records, spreadsheets, cloud drives, documents, emails, videos on the voice of consumers, and employee opinions constitute the main internal sources of data.
Final words
Both competitive and market intelligence can be mutually beneficial in feeding insights to the other. When you aggregate data about multiple competitors, it collectively reveals valuable understandings of trends in the larger market. So, despite significant fundamental differences, both play vital roles in creating data-driven business strategies.
