The analytical subdivision – either in the form of an individual job position or entire department – is a must-have for the medium-sized to large companies.
The senior executive needs to know the company’s current position in the market in order to be able to evaluate and calculate how he or she can get it to the place of own desires and ambitions, while surpassing the expectations of the investors or parent / managing company.
Continuous performance analysis is essential when determining the "well-being" of your business and identifying any existing issues early on.
In-house marketing analytics - the analytics generated using the company's internal resources – incorporates own marketing and sales figures into a single system which must be supported by the data of the external state of the market in order to transform them into the metrics ecosystem i.e. a logically-arranged, measurable and forecasted environment.
The Analytics Department tackles the task of gathering, structuring, analyzing and accurately providing the management team with information required for managerial decision making. There are large arrays of in-house analytical data. However, at some point the company may find itself in a situation, where the available data is still insufficient. Therefore, the top managers need to understand, in which cases this might happen, and when it is time to recourse to the outside experts.
Expert opinion of the international company’s CEO
CEO at AL-KO Andriy Boyko consistently engages the services of an independent agency, when he needs to understand the environment wherein the company operates.
In a number of instances, the in-house analytics can be quite biased and blind-folded, not because it lacks quality, but because the employees of analytics departments are in the middle of the market and in the internal environment. So, when they interact with the competitors, it is hard to rely on the information obtained in the course of these interactions, since there are certain taboos regarding provision of specific data to the competitor.
The external data of in-house analytics is biased, since it is not impartial.
In many ways, this resembles the football: the players of the competing team that are on the playing field cannot fully and in a non-biased manner analyze the course of the game, the actions of the colleagues, the quality of the decisions made by the coaches, team captains and each player, even though they stick to the clear rules of the game. The ambitions, emotions, the overall drive of the game and the relationships within the team all have an impact on the decision-making process.
It is even more challenging, when it comes to the world of business. Your market does not have any clear-cut rules of the game accepted by everyone involved in the process. The market’s playing field boundaries, the number of goalposts and balls are often inconsistent, including the very essence of the game: one of your competitors might be playing rugby, whereas the other one is playing football.
Project experience with involvement of independent analytical company
One of the world's major players has planned to launch its product in Poland’s construction materials market. The company has gained an understanding of the terms and trends of a new market by engaging external analytical research and having clearly defined the reasons for ordering the services of a third-party “referee” as follows:
Professional marketing agencies have extensive experience in implementing hundreds of projects, so a lot of know-hows are being developed with respect to definition of trusted information sources, tools selection and development of research techniques with a focus on the customer’s needs. It is especially vital, when the executor has industry expertise and is aware of the specific nature of the customer's market.
The project implementation included two stages:
Stage 1. Secondary Research:
- Data mining, collection of reports and information from the existing sources (statistical institutions, industry associations, publications in the mass media outlets, etc.);
- Analysis of the obtained information;
- Preparation of conclusions and hypotheses necessary for primary research.
Stage 2. Primary Research:
- Interviewing the target groups of respondents:
- Representatives of associations and industry organizations;
- Producers;
- General contractors;
- Subcontractors;
- Distributors;
- Wholesale dealers.
During the first stage of the project, analysts have processed statistical information derived from the following sources: city hall, ministries, sectoral authorities, companies involved in this sector, mass media, etc. The research was implemented in Polish and English.
As a result, massive bulks of unstructured texts with figures had been obtained and needed to be filtered out and properly arranged in order to transform them into data. Once that had been done, the data had to be evaluated and compared to its counterparts: adjacent markets, markets of other countries, etc.
Thorough and responsible data handling is an advantage offered by an outside marketing expertise. Based on these data, the hypothesis is designed to identify the trends, determine the patterns and check the relationships.
Suggested hypotheses are typically diagnosed in the expert environment, i.e. the primary research is implemented in order to confirm or disconfirm the existing hypotheses. In such a case, the expert environment was shaped out of the top managers of 30 manufacturing and importing companies of the market.
The outcome of the assignment completed by the agency was the analysis of the market of one of the construction materials group in Poland based on the following indicators:
7 Market Analysis Metrics
- Total consumer market dynamics;
- Dynamics of the market structure and segments;
- Dynamics of the external trade balance structure;
- Dynamics of the market structure and segments;
- Dynamics of the external trade balance structure;
- Market structure dynamics in terms of imported products/domestic production to evaluate the potential of import phase-out;
- Market structure dynamics in terms of players, competitive analysis.
On top of that, an overview of the dynamics of macroeconomic and socio-economic indicators for the period indicated by the customer has been provided.
Summary
The summarized data has been made into the unified marketing metrics, with independent conclusions and recommendations being generated with respect to the new player’s behaviour in the Polish market.
