Knowledge is power
You’re constantly looking to best your competition, right? And your strategy to achieve this likely involves looking internally: What can you do to improve your products and services and, ultimately, attract new customers? But does your strategy also call for looking externally? If not, it should. Gathering competitive intelligence can help provide strategic insights into your rivals’ future plans.
Years ago, the notion of gathering detailed information on competitors may have been negatively referred to as “corporate espionage.” Nowadays? Not so much. This is the information age, when companies have a strategic imperative to analyze every bit of data they can on what the competition is doing at all times.
Of course, “at all times” doesn’t mean “at any cost.” Competitive intelligence is the process of legally and ethically gathering data on competitors. And your purpose isn’t to undercut what they’re doing but to anticipate trends, compare best practices and target opportunities.
Specifically, you need to stay apprised of your competitors’ product and service lines, financial standing, and market position. You should also track whether the competition is expanding or contracting. Mergers, acquisitions or strategic alliances could mean you need to play defense, while closures or bankruptcy may mean it’s time to go on the offensive.
Before you dive into competitive intelligence, it’s important to establish a formal policy governing your efforts. (If you’ve already gotten started, perhaps slow down and integrate a policy going forward.) Generally, a competitive intelligence policy should be authentic. When gathering information, don’t hide behind secret identities or misrepresent your affiliation. For instance, if you sign up to receive marketing e-mails from a competitor, use an official company address and, if asked, state “product or service evaluation” as the reason you’re subscribing.
Your policy also must respect all formal agreements. In the course of gathering competitive intelligence, you or your employees may establish sources within the industry or even with a specific competitor. Be sure you don’t encourage these sources, even inadvertently, to violate any standing confidentiality or noncompete agreements.
Because the technicalities of intellectual property law are complex, you must abide by all intellectual property rights and laws. It’s not particularly difficult to run afoul of the rules unintentionally. When accessing or studying another company’s products or services, proceed carefully and consult your attorney before putting any lessons learned into practice.
Finally, be sure to monitor consultants closely. When it comes to competitive intelligence, the Achilles’ heel of many companies isn’t their employees but outside consultants. If you engage third parties for any purpose, be sure they know and abide by your policy.
Use available resources
The Internet provides a good starting point for competitive intelligence. Begin with your competition’s websites. You should know the ins and outs of their sites as well as you do your own. Look to relevant industry websites and blogs, too. And don’t forget social media: Facebook, Twitter and LinkedIn. Also check out Hoovers.com for “comprehensive insight and analysis about the companies, industries and people that drive the economy.”
The printed word is your friend, too. Assign one employee (or more) to keep tabs on national and local newspapers, industry publications and journals, and any other useful print sources. Your competitors’ brochures, catalogs, press releases, annual reports and other collateral should be must-reads as well.
Bear in mind that, at its most basic level, competitive intelligence can simply involve talking. Encourage yourself and your employees to chat up virtually anyone who might hold a nugget of useful knowledge — customers and prospects, bankers, business contacts, and referral sources.
Verify and analyze data
Naturally, you have to do more than just gather data. You must be able to verify its accuracy, a critical component of competitive intelligence, and analyze it.
Ensuring accuracy comes down to quality sources and fact-checking anything of which you’re uncertain. The task of analysis lies with you and your management team. Fortunately, there’s software that can make the job much easier.
Tip playing field in your favor
In today’s still-challenging economy, your business must use all available information to tip the playing field in your favor. Your competition, undoubtedly, is doing the same. Using competitive intelligence can help you learn what they’re cooking up and determine if your plans hold their own.
For more information contact Dennis McLaughlin at [email protected]