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Market intelligence: what is it and why is it important?

 Large companies know the importance of being on top of market trends. After all, they are the ones who say what the public wants, and the companies that stand out are the ones that know how to listen to them . That’s where the role of market intelligence comes in!

Market intelligence: what is it and why is it important?

And small and medium-sized companies cannot — and should not — be left behind. It is necessary to invest in techniques and technologies that show trends in consumer behavior and the market in general. This is why you, the manager, must invest in market intelligence.

Don’t know what it’s about? Well, believe me: working with market intelligence (also called business intelligence or BI) will make all the difference in your business. In this text, you will learn more about what it is and how to insert this strategy into your business. Check out:

What is market intelligence?

Market intelligence is a set of data capture techniques to obtain various important information for your business and, consequently, insights to improve it. This data concerns several segments, such as:

  • consumer behavior;
  • target audience profile;
  • competitors;
  • marketing;
  • products;
  • sales.

Although it is a strategy more commonly used today, the concept was created in the 1950s by Hans Peter Luhn, a famous researcher at the time. In his article “A Business Intelligence System”, he already proposed capturing data using automation resources.

In the 80s, with the advent of the internet, this idea began to become popular. From then on, professions specialized in processing this data began to emerge, such as information analysis, information engineering, modeling and data management.

The information contributes to the formulation of strategies that will move your business forward. Therefore, they must be analyzed carefully. With the advancement of technology and the amount of information available online, you have a very rich universe of data at your disposal.

How does data collection for the market intelligence technique work?

Collecting data for market intelligence has become much easier with the internet.
In this technique, data is divided into two forms:

  • Primary: they are generated on demand through surveys and questionnaires commissioned by the company itself. They usually aim to understand the public’s opinion , but all reports made with information about your company (marketing, sales and finance, for example) also contain primary data;
  • Secondary: data already available for consultation. They are present in research, books and articles available on the internet. Surveys carried out by other organizations or made available by government agencies are also secondary data. Despite their ease, they do not have specific information for your business.

Previously, doing primary data research was expensive. Today, with the internet, this task has become much more affordable and easier.

So, to carry out market intelligence, it is necessary to collect all the material and separate what will be really useful for your company, as the intention is for the data to provide a global view of the company. Some information can be collected and analyzed over a longer period of time (quarterly, semi-annually or annually), while others require analysis over a short period.

How to adhere to market intelligence in the company?

All sectors of the company must collect data and this data must be studied analytically.
Ideally, each sector should carry out this data collection. For example, the marketing manager collects and analyzes marketing data; sales, ditto. This collection must be standardized, to bring everything the company really needs and optimize collection.

Through applications and automation software, you collect data in the field and simultaneously share it in reports in a quick and organized way.

A practical example

You have a shoe store and you need to implement market intelligence. To do this, you need to know how much is spent on purchasing shoes from suppliers, that is, the direct costs. As they often vary over time, you need to investigate them periodically.

Then, we move on to secondary costs: expenses for rent and electricity for the store, taxes, salaries.

Now it’s time to find out how much you earn from each shoe sold, how many shoes are sold per day, which days of the week there are the most sales, what is the value of the average ticket, whether displaying the product in the window has any impact and much more . With this, you will know, for example, which times of the year sales are strongest and, mainly, whether the store is making a profit or a loss.

Data veracity

The information must be true. If there is any doubt about the veracity of something, discard it. Remember that they will guide the decisions that will guide the company’s future .

This data must be organized in spreadsheets or a management system. From there, analyzed so that all decision-making in each sector has an analytical basis, and not on pure guesswork.

Data analysis culture

From the analysis and separation of everything that is really useful, all decisions in your company must be made based on this data. Therefore, it is important to have a team made up of professionals with an analytical profile , who already work with data and numbers.

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