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Gathering Competitive Intelligence with Alternative Data

Coresignal

Coresignal

August 19, 2021

Healthy competition has always been at the heart of free markets. Likewise, as we have seen a shift towards the digital, and online information increases, business competition is now all about intelligence. Companies that know most about their competitors and markets, in general, immediately gain a competitive advantage and increase their chances of outperforming their competitors. Likewise, competitive intelligence is, of course, acquired through gathering data. The data most commonly used to generate accurate competitive intelligence comes from alternative data sources. Thus, it’s worth looking at how alternative data boosts competitive intelligence and helps to arrive at impactful insights.

What is competitive intelligence?

First, let’s look closer at what we call competitive intelligence. Competitive intelligence is the capacity and practice of gathering and analyzing information about competitors, customers, and general market conditions. Competitive intelligence aims at improving one’s market understanding that can be translated into gaining a competitive advantage. Such a competitive edge means that companies leveraging competitive intelligence to make decisions improve their ability to get ahead of the competition and solidify their market position.

This type of information gathering and usage is also sometimes called corporate intelligence and is related by not synonymous with business intelligence. Business intelligence is a broader term that generally includes various tools, software, strategies, and more, to help improve the quality and quantity of information relevant to making data-driven business decisions.

Competitive intelligence can be considered a type of market research but with very targeted questions to answer. Its goal is to find any information and uncover insights that will help the company stand its ground against the competition.

Main types of data gathering for competitive intelligence

Tactical intelligence

There are two main types of competitive intelligence, the first being tactical intelligence. This type of research seeks to answer shorter-term questions, helping to deal with the more pressing matters. The main goals of utilizing this type of intelligence are to increase revenue, grow market share and make better-informed decisions regarding marketing and other aspects of product promotion in the face of competition.

Strategic intelligence

The second type of competitive information gathering is strategic intelligence. Its main concerns are related to long-term decision-making. The questions firms aim to answer through strategic intelligence are connected with risk factors they may be facing in the future and long-term opportunities such as potential disruptive innovation.

Industrial espionage

While competitive intelligence represents the legal and fair side of business competition through information analysis, on the other side, we have industrial espionage. This term refers to such illegal and unethical practices as sending spies to be hired by competitors or buying information from former workers.

Responsible supervisors should ensure that there are no departments or individuals in the company resorting to such unethical means of gaining an advantage and protecting themselves from the outside threat. Such protection may include legal means of drafting non-disclosure agreements, taking care of data security, and carefully screening recruits, especially for data-sensitive positions.

Data categories for gathering competitive intelligence

There are many types of information that are used for competitive intelligence. Along with the better-known types of intelligence from the usual sources, now we have enormous volumes of alternative data that greatly boost the quality and usability of intelligence.

General firmographic information

When trying to find useful information about the competitive landscape we are facing, naturally, we first look at the competitors. Firmographics is a great way to get to know what other companies are in the game and what are their main qualities. Firmographics refer to all the general statistical information about organizations, such as their size, revenue, market share, and growth trends, among very many others. Through firmographic segmentation, companies recognize their direct and indirect competitors and get to know their competitive position, and measure them against one another and themselves.

Competitor product and services information

While firmographics will tell you the basics of what you need to know about competitors themselves, after that, you will still need to know more about what exactly they are offering. This means that competitive intelligence must include as much information about their products or services. 

How different or similar are they to your product? What advantages and drawbacks do they have, and do they offer any clues into how your offering could be improved? Such and similar questions should be on your mind when gathering information about the services and products that other firms in your industry are offering.

Marketing and other strategies

The next step in forming full-fleshed intelligence is collecting information on the various strategies that the competitors employ. First and foremost, this refers to their marketing strategies. If another organization is outperforming your company, your first question might be, why? Additionally, all strategies or tendencies of competing firms are essential and may provide valuable insights. Thus one must look at any signs of tendencies and patterns in managerial decision-making of competitor companies.

Customer sentiment regarding the competitor

The information regarded as competitive intelligence also includes how consumers feel about your competition and their products. This means not only what you can tell from the sales revenue of the competing firm but also the more detailed customer sentiment data. Such alternative data may come from social media, as well as online product reviews. It’s important to not only understand how the people like the products and services of your competitor but also their general registered trademark recognition and view of the brand.

Competitors technological and other capabilities

It is also crucial to understand what the competitor is capable of as far as advancements, first of all, technological go. This means that one should know the competing company’s technological stack, what sort of hardware and software they’re using, whether the technology is state-of-the-art and how they implement updates. All this information generally comes from technographic data. Technographics are a lot like firmographics, only that they are concerned exclusively with all things related to technology.

The capacity to utilize technology tells the firm’s general capabilities to stay competitive and move forward in the market. Thus, technographic data is among one of the most important data types that need to be acquired to construct strong competitive intelligence.

Current operations

Of course, it’s always important to know what others are doing right now. Other companies’ current operations may determine your and your company’s future prospects of capturing market share. Any competitor’s actions, from a new product launch or press releases to acquisitions or formed partnerships, should be noticed for further analysis and potential insights. Such information may not only reveal what others are doing but why they are doing it as well, leading to a better understanding of where the markets are heading.

Market prospects

The direction in which the market is moving should be understood through various kinds of alternative data. This part of competitive intelligence refers to macroeconomic data as well as general information about the market as it relates to what you know about your competitors. By comparing this information with the data on competitors, one should determine how well they are positioned to move along with the market and stay competitive. Naturally, equipped with such knowledge, firms can also tell more than a few things about their own market prospects.

Competitive intelligence data sources

Now that the basic structure of competitive intelligence is clear let’s look at how to gather information for it. As mentioned, alternative data sources are vital these days, as the intelligence acquired through them is more versatile and often more revealing. Below are the key types of data sources for competitive intelligence.

Competitors and other industry sources

The most basic way of collecting some information about the competitors is as old as business competition itself – one can simply do what their clients would do. That means buying and analyzing their products, subscribing to their news releases, visiting competitors’ websites as well as their shops and other locations that are open to the public.

Additionally, one can gather information through various associations, online and offline conferences, and forums with industry experts. Simply being part of the community and keeping in touch with other industry professionals is a way of staying informed of what is happening and what matters the most.

Customers 

After the competitor companies themselves, the main source of competitive intelligence is the customers. This means that one should survey the customer base restlessly both online and in person. Additionally, it is always advisable to organize focus groups and get feedback on how your product or advertisements compare to those of the competitor. Furthermore, alternative data from online sources such as social media information or online product reviews are a great source of helpful information.

Data providers

The data used for competitive intelligence is very diverse, and not all companies can get it on their own. Therefore, it is advisable, and more often than not, necessary that businesses turn to alternative data providers to ensure intelligence quality and value. Such help can come from a reliable third-party alternative data source. In fact, 69% of companies that used outside help for their competitive intelligence have reported positive results.

Data providers can supplement a company’s data sets with such alternative data types as aforementioned firmographics and technographics, as well as social media data and many more. These companies employ web scrapping and other methods to gather all relevant information that is available on competitors’ websites and elsewhere online. Therefore, they’re able to offer much more information than most companies could efficiently get on their own.

Suppliers and partners

Other sources of competitive intelligence are competitor’s suppliers and other partners. One can gather actionable information by looking at the companies that supply materials for the competitor or by their logistic partners. Knowing what sort of B2B services the competing companies are using will reveal both their current competitive position as well as future intentions. Such B2B data can also provide insights for better business decisions by revealing which partnerships work and which don’t.

Media and academic research

Finally, another broad category of sources for competitive information is published and visual media, including both popular media and academic research. For example, data gathered about a firm’s media presence by monitoring mass media outlets is a strong indicator of a competitor’s brand recognition. One should research both positive and negative coverage of competitors and compare it to their own company’s media presence.

Additionally, it is advisable to subscribe to journals that aim to illuminate the current market stance and may contain articles by the industry experts touching on competing companies. Furthermore, academic market research and reports will provide valuable statistics about other firms and case studies that may be a source for a deeper understanding of particular competitors.

Competitive intelligence tools

The effect that data has had on contemporary markets is only comparable to the way business has been affected by advancements in AI-based tools and software programs. These tools are extremely helpful with competitive intelligence tasks as they are capable of handling large volumes of data efficiently. They can help both with analysis as well as visualization of the results, ensuring that insights show up clearly and are easy to comprehend.

For starters, there are many free competitive intelligence tools that can be used for improved competitive intelligence. For example, Crunchbase gets a lot of company data from their community contributors and makes it accessible for free. Therefore, it can be used for a quick overview of basic information on a lot of companies. And such tools as Google Alerts or Talkwalker can be used to track online mentions of particular keywords, thus allowing you to know what is said by or about your competitors.

Here at Coresignal, along with a vast array of high-quality data from firmographics to job postings data, we offer access to said data that can help boost your competitive intelligence. Features such as convenient delivery through our global infrastructure, Database API, parametric filters, and more are made specifically to improve the efficiency and quality of competitive intelligence gathering and analysis.

The importance and benefits of competitive intelligence

The importance of competitive intelligence in the business world after the informational revolution is more than clear. Information is an asset, the more of it you have and the better you are able to utilize it, the greatest business success you can expect. To specify how competitive intelligence gathered with alternative data helps companies, here are a few key points about its benefits.

Competitive advantage

It is not hard to guess that the main objective of competitive intelligence is a competitive advantage. The old saying that “knowledge is power” has very practical meaning in the data-driven competitive landscape of today. Through information analysis, companies know what their competitors are doing and going to do. Additionally, they can learn from their mistakes and adapt their best practices. Furthermore, correct evaluation of competition allows to prepare better strategies and increase the ability to go head to head with your competition.

Market insights

Knowing your competitors means knowing the industry and the market. Other firms can be generally understood as market variables that one needs to account for when forecasting market conditions and planning for the future. Thus, competitive intelligence research leads to invaluable market insights that can boost strategic planning at all levels and departments.

Product and marketing research

Gathering competitive intelligence, especially with alternative data, also inevitably means marketing and product research. Thus, by collecting such information, companies also learn about products in the market and how their own product can be improved. Of course, this information also helps the sales team and gives ideas on how to reach the target audience and showcase the strong features of the product better.

Understanding customer sentiment

Competitive intelligence gives insight into customer sentiment both directly through getting information from the consumers and indirectly through looking at what works for the competition. Thus, knowing your competitor also leads to knowing their existing and prospective customers, which are, of course, also your potential customers. And with good intelligence, you are better equipped to make sure that they drift towards you and not the competing company.

Competitive counterintelligence

The value and importance of competitive intelligence are best proven by the sheer scope of its usage in modern business. In 2020, as much as 94% of businesses had been investing in competitive intelligence. This might be the most important business trend you need to know, as it shows how important intelligence is for successful competition.

Additionally, it makes it worthwhile to say a few words about competitive counterintelligence. As previously mentioned, 94% of businesses investing in competitive intelligence suggests that it’s highly likely other companies are also gathering competitive intelligence about your company. To counter these business practices, you can include counterintelligence practices into your overall competitive intelligence strategy.

These practices include the abovementioned measures against industrial espionage. Additionally, one should invest in data security technology and be very careful about what is published on the company’s official websites and social media pages. Finally, along with researching the competition, you can research yourself to see if something can be found that should not be available externally.

To sum up

To compete successfully and avoid missed business opportunities, companies should prioritize various types of business-related intelligence practices and market research strategies, especially their approach to competitive intelligence. This type of business information gathering is drastically improved by alternative data, leading to versatile and actionable market insights and help to stay ahead of the competition.

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