At their core, competitor analysis and market intelligence are themselves tools that businesses use to inform marketing strategies, product roadmaps and senior-level decision making. In fact, one of the earliest documented uses of these techniques dates back as far as the 16th Century.
For 30 years, the Fugger Family, wealthy business owners in Germany, published a newsletter with competitive market intelligence on threats and opportunities for their international businesses located across Europe, Africa, Asia and the Americas. The information they monitored through their agents abroad included price of goods, competitor activities, political events, street crimes and wars.
Competitive Intelligence as a Recognized Business Practice
Although intelligence gathering and competitor analysis are no doubt age old concepts in the business world, in the United States competitive market intelligence did not emerge as a recognized discipline and tool for corporate decision-making until the 1970s.
During this time, corporations in every industry from oil and electronics to baby products and photography, gained advantages in their markets by gathering, analyzing and acting on competitor intelligence and changing market conditions.
In 1983, Motorola CEO Bob Galvin built one of the first formal corporate CI groups, which served as an integral part of senior decision-making within the organization for the next 26 years. Jan Herring, 20-year CIA veteran and former National Intelligence Officer for Science and Technology was brought in to launch and lead the team, which was also made up of five former intelligence agents who served in government positions. It wasn't long before industry giants like Exxon Mobil, Procter & Gamble, Johnson & Johnson followed suit, developing their own internal organizations to support competitor analysis and deeper market intelligence.
Widespread Adoption of CI Tools
By 1998, it was estimated that over 80% of companies with more than $10 billion in annual revenue had an organized intelligence system that combined strategic internal teams with outsourced resources for research projects. Mid-size companies that did not have the capacity to build in-house intelligence teams, were outsourcing curation, analysis and reporting projects to consultants and intelligence firms. Even small businesses owners who had little to no budget for CI-dedicated activities were collecting and analyzing as much information as they could find on local markets and direct competitors.
Modern Day
These days you might assume that every business in the United States is engaging in CI and MI activities, and you wouldn't be wrong. However, there are still a number of challenges for businesses in maximizing the impact of competitive intelligence and getting the most value out of their investments in these programs. And although the process of gathering and analyzing intelligence can be frustrating at times, even with all of the modern tools and technology we have today, significant progress has also been made in just a few decades.
To learn more about the past, present and future of competitive intelligence tools, download our whitepaper, The Evolution of Competitive Intelligence Tools!