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Competitive intelligence is about uncovering and analyzing data sources to identify market opportunities, threats, and risks. And AI has the potential to completely revolutionize this process.
With AI, information can be analyzed in a fraction of the time it would take a human.
In addition, the process is more accurate because a machine has a better ability to analyze data points than a human.
The more complex the problem, the better AI will be at solving it. A
s society becomes digitized, competitive intelligence will only become more necessary for success. Here’s how you can use AI in competitive intelligence today.
What is competitive intelligence?
Competitive intelligence is the practice of gathering and analyzing market information to identify opportunities, threats, and risks.
It's important for every business because it helps you determine how you can best compete in your industry.
Competitive intelligence allows businesses to make educated decisions about how to position themselves against their competitors.
It also provides insight on new growth opportunities, changing customer demands, and the shifting economy.
Competitive intelligence is a complex process that requires a firm understanding of your industry and the data points that are most valuable for your business.
You need to be able to spot patterns, understand their meaning, and know how they will impact your bottom line.
Why is competitive intelligence important?
Competitive intelligence is extremely important because it helps you understand your competitive landscape.
It's crucial to your success, because the right data can help you make informed business decisions.
For example, if you are in a market with many competitors, understanding their strengths and weaknesses will help you figure out how to approach the market.
Or, if your company has an innovative technology that competitors are using, knowing its strengths and weaknesses will help you decide how to combat that threat.
Regardless of the niche or industry you're in, competitive intelligence helps give you an edge over other companies in the same space.
By knowing what's going on in your sector and comparing yourself with others like-minded companies, you'll have a better idea of what steps to take next.
What is the competitive intelligence process?
Here's a simplified description of how the competitive intelligence process works:
- Identify your target audience.
- Determine what data you will collect on them and competitors.
- Collect the data.
- Analyze the data to identify opportunities, threats, and risks in the market.
- Implement changes as necessary to mitigate or capitalize on these opportunities and threats.
Types of AI for competitive intelligence
The term competitive intelligence can be used in different ways.
Some people use it to refer to the gathering and analyzing of market data, such as consumer behavior and industry trends.
Others use it to describe the process of identifying a company's competitors or even their own strengths and weaknesses.
But regardless of the type of competitive intelligence you're referring to, AI is a promising way to perform it. There are many types of AI that can help with your competitive intelligence:
- Knowledge discovery
- Machine learning
- Natural language processing
- Data mining
- Speech recognition
- And many more...
These techniques have been applied in various industries, including finance, manufacturing, healthcare, retail, and many more.
Examples of AI for competitive intelligence
Artificial intelligence has revolutionized the competitive intelligence process.
In fact, it can be used to identify market opportunities and threats with greater accuracy than humans.
This is not only because AI analyzes information faster than humans but because a machine has a better ability to analyze data points than a human.
AI can be applied in three ways:
- Forecasting: Combining available data with machine learning algorithms to develop competitive intelligence forecasts and predictions based off of past events.
- Pattern and trend recognition: Sifting through massive amounts of data and finding competitive patterns and trends.
- Market profiling: Creating profiles on competitors and competitors' products that can then be utilized for competitive advantage
In order to use AI for competitive intelligence, you need the following components:
- A research question that needs to be answered or an analysis you want to conduct.
- Data of some type (e.g., qualitative data or quantitative) that needs to be collected or analyzed.
- Machine learning techniques for how AI will help answer your research question or create profiles on competitors in order to create competitive advantage.
Let's take a deeper dive into some big ways AI can make an impact on competitive intelligence...
Using AI to analyze competitive intelligence data
AI can be used in competitive intelligence for a variety of different purposes. For example, intelligent algorithms can be programmed to identify patterns in data and make predictions about future outcomes.
Or they can be programmed to take information from disparate sources and analyze the data together.
In this analysis, AI is able to quickly identify opportunities that exist in your industry. It's also possible for an AI algorithm to do the same thing with threats and risks. This type of analysis helps you identity what's happening around you so you can take action accordingly.
A great way to use AI is by having it conduct searches on your behalf.
For example, you might want to know where your competitors are advertising their products or services, or how your company ranks in certain metrics like social media reach or online reviews.
Maybe you want to know how many people are on your website at any given time or how much of their attention is directed toward specific sections of your site.
Using AI to find patterns in competitive intelligence data
AI can be used to uncover patterns in data. It can help your business find insights that would otherwise take a long time.
For example, let's say you're running a retail store for a local bakery called Sweet Tooth Bakery. You're trying to figure out which ice cream flavor is going to be the next big hit in the market.
You could try to guess, do some market research, and/or poll ice cream lovers.
But these methods are time-consuming, costly, and often inaccurate.
AI presents another path...
With the right data, AI could analyze ice cream purchasing trends over the last 12 months. It could then analyze social media chatter about different ice cream flavors. It might even look at which ice cream ads your competitors are running.
AI might then use this information to predict which flavors are growing or shrinking in popularity, allowing you to get a jump on the competition.
Using AI to predict competitive intelligence trends
AI is already being implemented by companies to help them predict the future. AI can discover trends and patterns in data that would otherwise be overlooked by a human. This allows businesses to make more informed decisions based on data they didn't think existed.
For example, AI can predict which product or service will be most successful moving forward. Let's say you want to sell a new type of clothing line. With AI, you can run multiple tests, such as which social media platform your target audience uses most and whether they are looking for new trends in fashion.
Once you've found out the most important variables for success, you can create a plan for how your company should market the product or service.
Even better, if your competitors aren't using AI, they'll spend a ton of time and money playing catchup to your AI-powered competitive intelligence efforts.
Get started with AI for competitive intelligence...
Take our free online live class Intro to AI for Marketers.
In it, Marketing AI Institute founder and CEO Paul Roetzer will teach you exactly how to understand and get started with AI. During the class, you’ll learn:
- What AI is, and why it matters to marketers.
- How to identify AI use cases.
- How to find and evaluate AI technology vendors.
- How to classify AI applications within the five levels of the Marketer-to-Machine ScaleTM.
- What business outcomes AI can help you achieve.
- How to measure the value of AI tools on your company’s efficiency and performance.
- How to prepare your team for piloting and scaling AI.
In just 30 minutes, you can lay the foundation to transform your career and business for the better using AI.
Space is limited! Click here to reserve your spot for the next class.
Mike Kaput
As Chief Content Officer, Mike Kaput uses content marketing, marketing strategy, and marketing technology to grow and scale traffic, leads, and revenue for Marketing AI Institute. Mike is the co-author of Marketing Artificial Intelligence: AI, Marketing and the Future of Business (Matt Holt Books, 2022). See Mike's full bio.