Development of CI

Why is CI essential?
• Customer focus has been the distinguishing
characteristic of an organization that has
embraced the marketing concept.
• To develop the marketing strategies marketer
needs to understand the customer activities,
requirements and expectations
• However customer analysis has never been
able to provide answers to all marketing
questions
• Hence we need to study the suppliers,
competitors, distributors etc.
• Each of them is a valuable source of
intelligence
• Information on competitors has always been a
component of tactical and strategic marketing
planning
Development of CI as a formal activity
• Companies move through a series of stages

Competitor aware

Competitor
sensitive

Competitor
intelligent
 Competitor aware
• Stage is entered soon after a company is
formed or even before, when the start up is
being planned
• It means that the key competitors are known.
There is some knowledge – usually incomplete
and unverified
• Data used rarely for occasional ad-hoc tactical
exercise such as competitive pricing decisions
 Competitor - sensitive
• As companies grow, they become competitor
sensitive in terms of the awareness of the
damage competitors can inflict and the need
to win orders by competing more effectively
• But does not always increase the demand for
information on competitors
• Try to copy what they perceive to be the best
of competitors’ practices
 Competitor intelligent
• One that devotes serious resources to study
the competitors and anticipate their actions.
• Includes identifying competitors’ physical and
intangible resources, studying their
organizations and their methods.
• Set up to anticipate competitors’ activities
 Factors influencing the growth of
competitive intelligence
• Need for a competitive strategy
• Ability to study the competitors
• Ability to use the intelligence
 Need for a competitive strategy

• Perceived need for a competitive strategy is

determined by the level or intensity of
competition in the market serviced by the
company
• Series of developments happening that
resulted in intensification of competition:
- privatization, deregulation, liberalization,
global marketing, periods of economic recession
Ability to use competitive intelligence
• High awareness of tactical applications of CI is
present but strategic use of CI to position a
company is less developed
 Ability to study competitors
• It is the ability to obtain a regular supply of
accurate intelligence
• This is gathered through internal sources in
the form of published reports, newsletters,
company websites, etc
 Factors inhibiting the growth of CI
• Fear that CI is unethical
• Counter Intelligence
• Failure to deliver on promises
• Data protection legislation