The Complete Guide to Gathering and Optimizing Competitive Intelligence

If you have any competition in the market (and, trust us, you do), it’s important to know what you’re up against when vying for sales and customer retention. Understanding your direct, indirect and aspirational competition—collectively referred to as the competitive landscape—is an essential business function for your product development, sales, marketing, client services and executive teams.

Mapping out your competitive landscape and continually collecting and analyzing information on your competitors is commonly called competitive intelligence, and it’s key to gaining and maintaining market position. Without knowing what your competition is up to, you could be left in the proverbial dust. 

Why is it important to understand the competitive landscape?

 

Every business has competition, both direct and indirect. If you don’t, you will soon enough. Direct competition includes any business that offers a product or service in the same lane as yours. For example, McDonald’s and Burger King are direct competitors. They’re both vying for customers who are in the mood for fast-food burgers and fries. 

Indirect competition refers to any business that offers an alternative product or service that still satisfies the general problem your market is trying to solve. Indirect competitors to McDonald’s include other quick-serve restaurants, including Domino’s and KFC.

And then there are also aspirational competitors—larger companies with whom you don’t currently compete but hope to one day. They also can include massive corporations like Google and Amazon that you don’t compete with, but if they got into your space, you would be worried.

Knowing about and understanding your competitive landscape is crucial to your business in several ways. It allows you to:

  • Optimize your go-to-market strategies and tactics
  • Shorten sales cycles and drive up customer retention rates
  • Accurately anticipate competitor threats and embryonic opportunities
  • Maximize product life cycles and optimize end-of-life and level-of-effort opportunities

What is competitive intelligence?

Competitive intelligence is the process of learning and analyzing information about your competitive landscape. It involves identifying competitive and alternative offerings in the market, assessing their strengths and weaknesses and developing a strategy for winning against the competition. 

Understanding Market

The goal when it comes to collecting competitive intelligence is to be the first to know—and the first to act on—fresh information to stay ahead of your competitors. Competitive intelligence is most beneficial before the information becomes public.

Who is responsible for competitive intelligence—and why?

Some companies have dedicated competitive intelligence analysts on staff or even teams of them, depending on the organization’s size. If your company does, it’s the analyst’s job to collect and make sense of your competitive landscape. But it is largely the product manager’s responsibility (or sales manager’s responsibility if it’s a sales-led business) to decide how to utilize the intel to make business decisions. And, of course, if a company does not have competitive intelligence analysts on staff, then it’s the product manager’s or sales manager’s responsibility to collect competitive intelligence and/or outsource this function.

Whoever is ultimately responsible for competitive intelligence in your organization, it’s important to recognize that anyone in a company may be in the position to obtain intel and should be encouraged to share it with the product manager. In turn, you should also be cognizant to regularly share competitive intelligence with internal stakeholders. Remember, competitive intelligence can influence every single stakeholder inside of the organization, from the executives to the marketing team, sales, client services, etc. So whoever’s heading it up needs to be thinking about how to package the insight in a way that can be shared meaningfully across the organization. 

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Competitive intelligence is the process of learning and analyzing information about your competitive landscape.

What are the best sources of competitive intelligence?

The good (and maybe bad) news is that competitive intelligence can be gleaned from lots of different sources. Some of the most effective include: 

  • Evaluator interviews and win/loss data
  • Shared customers
  • Channel partners and others who frequently interact with your competition
  • Trade shows and other events
  • Third-party research
  • Customer review sites
  • Employee review sites
  • Business/industry news organizations
  • Social media

Competitive intelligence is most useful when it’s fresh, and other competitors don’t have access to it. That means information collected from sources such as win/loss data, shared customers and channel patterns is likely to be the most valuable.

No matter how you go about collecting intel on your competitors, it’s important to do so legally and ethically.

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How to conduct market intelligence research

Conducting competitive intelligence research and analysis is a multistep process. While it’s tempting to dive right into scouring the web and calling up channel partners to get the scoop on your competitors, it’s important to put a process in place so you can get the most out of your efforts. 

  1. Map your competitive landscape. List your direct, indirect and aspirational competitors and rank them in order of importance.
  2. Narrow down your areas of interest. Prioritize the types of intel that are most desirable to your needs. This may be a competitive pricing strategy, new product features or even manufacturing methods or shipping logistics.
  3. Collect, organize, analyze. This is when you dive in and gather information. Then, streamline the intel you’ve gathered, filtering out unnecessary information. Next, comb through the data you’ve collected to make sense of it. Highlight the most credible and useful information, and track trends.
  4. Share what you’ve learned. Prepare a report summarizing your findings and disseminate it to stakeholders. Bonus if you customize reports according to your audiences, including sales, marketing, executives, etc. This extra step will make them more likely to read it if they don’t have to sift through information that isn’t relevant to their needs.
  5. Repeat. Continually collect competitive intelligence and update your data accordingly. Depending on your sales cycle, this should be done quarterly, if not monthly.

When in your product launch should you use competitive intelligence?

Product launch steps

In short, you should be using competitive intelligence all throughout your product lifecycle from development through launch and beyond. Competitive intelligence can help you create a product that uniquely solves market problems better than anyone else. It can help you prioritize features that will provide the best return on investment. It helps inform product testing and decisions around whether you should launch, continue iterating or abandon a product altogether. It also can help you determine optimal pricing and develop sales and marketing strategies that will differentiate you from your competition.

For more on when to use competitive intelligence, listen to Using Competitive Intelligence to Ensure a Successful Product Launch.

Examples of competitive intelligence in use

To better understand competitive intelligence, it might be helpful to see it in action. Below are a few observable ways brands have used competitive intelligence to make business decisions to develop products/services, gain market share, etc.

Instagram

While Instagram enjoyed a fast rise to fame, it kept an eye on another platform that was hot on its heels. Snapchat launched mere months after Instagram came onto the market and was growing at break-neck speed. Snapchat’s differentiator was the fact that user content was generally shared only for a short period of time. Shortly after Snapchat launched its “stories” feature, which allowed users to share a series of posts to tell a story that was available for just 24 hours, Instagram added the same feature and immediately slowed Snapchat’s growth by about half.

Google

Google wasn’t about to get into the word processing software game—until it identified a major need in the market. The company recognized the ubiquity of Microsoft Office, but decided to take it on after it uncovered a major flaw: Businesspeople were still emailing documents back and forth to work on, which was time-consuming, cumbersome and risky with the potential for losing work. Today, “Google Doc” is synonymous with “collaboration software.”

Competitive intelligence tools

Because more companies are engaging in competitive intelligence analysis, we’re seeing platforms emerge that are designed specifically to help businesses curate and aggregate competitive insight. Klue and Crayon are two that combine those exact capabilities. Inovis is another competitive intelligence vendor-specific to the IT, digital health and life sciences industries.

Remember, much competitive intelligence can be gleaned from win/loss data. Clozd and DoubleCheck Research offer highly recommended win/loss analysis solutions. Gong and Chorus also have good reviews. They offer software that actually listens in on your sales calls to detect intel and track trends.

You can also use a variety of other tools and technology to collect intel on your competitors, including:

  • Review sites, such as G2 in the software space and Amazon and Which? for consumer products
  • Employee review sites, such as Glassdoor
  • Media monitoring solutions, such as Meltwater and Cision

How to make competitive intelligence actionable

Competitive intelligence collection in a puzzle

Competitive intelligence collection and analysis are highly important, but there’s a caveat: They’re just part of the puzzle. 

You’re going to collect a ton of information from competitors. But that doesn’t mean they’re doing everything—or even anything—right. So take caution not to jump on the us-too bandwagon or fall down the features rabbit hole without cross-referencing your findings against your market problems.

Are prospective buyers and current customers saying that what your competitor is doing really matters? Are fanciful features and a competitive pricing strategy really decision drivers?

You need to have that barometer to help you understand what truly matters and what doesn’t. Otherwise, you could fall into the trap of endlessly chasing your competitors. That’s not strategic, and it’s not necessarily addressing your buyers’ needs.

Competitive intelligence’s legal and ethical challenges

Everyone wants that competitive advantage. But intelligence collection and analysis require awareness of information that may live in a gray zone—not fully in the public domain but not exactly a corporate secret either. Gathering competitive intelligence requires great care to understand what information may be legally collected and how to collect it ethically.

Legal considerations of competitive intelligence

The legal aspects governing competitive intelligence are established, and you should know them. Even unintentional violations can cause significant corporate and/or personal fallout. So, learn and follow your company’s requirements regarding laws that affect competitive intelligence gathering for all countries where you do business.

For example, in the U.S., key relevant federal statutes include the Uniform Trade Secrets Act (UTSA) and the Economic Espionage Act of 1996 (EEA). Both address theft or misappropriation of trade secrets, and violations carry high penalties. There are other U.S. statutes to consider, too. For example, antitrust regulations are an issue if two competing entities discuss market division and/or pricing; and fraud, which generally refers to misrepresenting yourself or your purpose to gain information. Countries outside of the U.S. have their own—often more restrictive—legal statutes governing these and other factors.

In practice, you may encounter situations in which interpreting statutes like these is open to ambiguity. Along with strictly following your company’s requirements, when in doubt, leave it out. It’s always better to take the high road. And, though it should go without saying, local statutes addressing inappropriate activities, such as breaking and entering, trespassing and theft, also apply to competitive intelligence gathering.

The practice of engaging third-party competitive intelligence vendors on your behalf can carry benefits—from freeing your team’s resources for more strategic work to obtaining candid, sponsor-blind information you can’t get directly. Remember, though: Your vendor must follow the same laws as your company. If it’s proven that you pushed a vendor to violate the law, your company remains responsible. Conversely, engaging a vendor that exhibits questionable conduct themselves can hurt your company’s reputation.

It’s important to vet the longevity and history of a competitive intelligence vendor to ensure they can be trusted to follow your company’s requirements and adhere to high ethical standards themselves. As a start, screen for cease-and-desist orders or other related legal conflicts in their operating history.

Ethical considerations of competitive intelligence

Next, consider what you should—or shouldn’t do (even if it’s legal). This is where business ethics come in. It’s easy to bump into the gray zone when you want to understand the competitive landscape and its players beyond publicly available information. This is when you must decide what’s acceptable in pursuit of these insights.

Brand protection is a key reason that companies establish corporate ethics. You are, of course, responsible for adhering to your company’s ethical guidelines to protect the brand. Likewise, the discipline of competitive intelligence has its own ethical guidelines established by the organization of Strategic and Competitive Intelligence Professionals (SCIP) to protect the competitive intelligence brand. Hint: Follow both your corporate ethics and competitive intelligence-specific ethics. The credibility of the guidance you provide to your leadership depends on it.

Even within these guidelines, navigating ethics takes care—especially when collecting competitor information that, while you don’t believe it to be a corporate secret, isn’t shared openly. Pricing, salesforce compensation, development and marketing timelines, bundling strategies and so on may not be corporate secrets. But each is more protected than other information that’s available in public documents.

For example, a B2B contract may not be a corporate secret, but the issuer may not want it shared with competitors. You may want access to the competitive pricing strategy in it, but competitive intelligence ethics dictate that you don’t misrepresent yourself or your purpose when seeking it. And, specific to pricing, if your company is in a dominant position, asking vendors for pricing information and acting on it may be viewed as anti-competitive.

Additionally, as with the legal aspects of competitive intelligence, it’s important to consider ethics from the perspective of the culture in any country where you will collect competitive intelligence. Some countries set a higher ethical bar in collecting competitive intelligence than others, requiring additional care—and potentially different methods, such as face-to-face interviews vs. phone-based ones—in your inquiries. This must be factored into your timelines and expectations.

Collecting competitive intelligence legally and ethically

Here, we draw on more than 50 years of combined experience as competitive intelligence practitioners and providers to recommend practical considerations regarding the ethics of competitive intelligence. As with any recommendations, they should be filtered through your own company’s requirements.

  • Collect secondary competitive intelligence. Getting competitive intelligence from publicly available sources, the public domain or open source is the simplest competitive intelligence work and carries little to no risk of competitive intelligence ethics violations. Then again, everyone else can access this information, too.
  • Ask internal sources within your company. Sales staff, support employees and field workers often have insight on your competitors since they interact with clients who may have experience with other vendors/suppliers.
  • Cultivate an external source network. Develop relationships with others in your industry who have access to information on your competitors. To maintain the relationship, you’ll need to have information to provide as well, while adhering to all legal and ethical guidelines.
  • Attend trade shows and other events. These are rich environments for collecting information on competitors since they’re often where new product iterations are unveiled and key announcements are made. It’s OK to approach booth representatives to ask about their products, what’s in the pipeline and what the latest announcements mean for business. It’s not OK to pretend to be someone else, like a customer, when you do it.
  • Communicate directly with competitors. In other words, go right to the source and ask. This is the most reliable and fastest way to collect intelligence. You might not get it, but, hey, it’s worth asking. Again, just take care not to misrepresent yourself.
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Gathering competitive intelligence requires great care to understand what information may be legally collected, and how to collect it ethically.

Learn more about gathering competitive intelligence

Understanding the marketing landscape and learning how to gather competitive intelligence is beneficial for every business. Register for Pragmatic Marketing’s Foundations class today to learn more about how to evaluate your competitive landscape and use the data you collect to your advantage.

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