Have the Millions Spent by Energy, Resources and Environment Companies on Market Intelligence Paid Back?

July 18, 2013. Some global companies in the energy, resources and environment industries will each spend as much as US$1 million on market intelligence* in 2013. While this may appear substantial, they are however, not the biggest spenders. By comparison, some manufacturing and industrial companies may commit as much as US$130 million to market intelligence in a single year.

With the large amount of money that is invested in market intelligence, do industry executives think that the time and resources they have put into intelligence have been useful? How efficient is market intelligence in these industries?

 

The answers can be found in M-Brain (formerly GIA)’s 2013 Global Market Intelligence Survey, where we compare two groups; companies in the energy and utilities sectors with 33 respondents and those the oil and gas sectors with 31 respondents, using the results from automotive companies as benchmarks.

 

Energy and Utilities Oil and Gas Automotive
Our investments in market intelligence have paid off 70% 64% 89%
Decision-making is very efficient 67% 61% 79%
Information is always readily available 46% 32% 38%

Source: 2013 Global Market Intelligence Survey, M-Brain (formerly GIA)

Market-Intelligence-in-the-Energy-Utilities-Industry_small

Market-Intelligence-in-the-Oil-Gas-Industry_small

 

Overall, it would seem that companies in the energy and utilities sectors benefit from more efficient market intelligence capabilities than oil and gas companies. In a ranking of 20 industries in the study, the energy and utilities industry ranked 6th in terms of their market intelligence capabilities, while the oil and gas industry ranked 19th.

 

In addition, the cross industry comparisons in the study also shows that while executives in the media and entertainment sectors consider their market intelligence to be very advanced, placing them number one overall, the perceived return on investment (ROI) in these companies is the lowest.

 

The study also shows that large budgets are also no guarantee of more advanced market intelligence functions. For example, medical devices and healthcare companies spend more than 20 times as much on market intelligence than energy and utilities companies on average, yet their market intelligence capabilities are ranked 17th in the study.

 

The relatively low availability of business information (46% in energy and utilities and 32% in oil and gas) however, highlights the need for sophisticated market intelligence, in order for industry executives to make better-informed decisions, particularly when we compare the results with the automotive industry’s in the table above.

 

All in all, it appears that more can still be done to raise the market intelligence capabilities at energy, resources and environment companies to world class levels.

 

According to benchmarks used in the research, companies that have the most advanced market intelligence functions have only grown from strength to strength. They have increased the amount of market intelligence delivered directly to their top management to 46% since 2011, compared with only 36% for an “˜average’ company. Such world class market intelligence companies have been proven to be 28% more efficient in decision-making.

 

Their market intelligence executives are also 33% more likely to be viewed as trusted advisors to top management and serve 50% more internal clients using efficient software tools.

 

* Market Intelligence refers to the corporate function where companies gather and analyze information that affects their businesses, which they then turn into market insights to support decision-making. It covers areas such as customer interviews and insights, technology analysis, competitor analysis or strategic analysis. In order to conduct market intelligence effectively, corporations invest in business information management tools and conduct research projects and workshops to help them forecast megatrends and plan ahead.

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