Chemical Industry Players to Push for Greater Market Intelligence Development

September 29, 2011. Innovations, new products and applications, greater environmental awareness as well as changes in global demography and consumer preferences are impacting the value chains of chemical companies. How are global chemical players addressing this through market intelligence?

Innovations, new products and applications, greater environmental awareness as well as changes in global demography and consumer preferences are impacting the value chains of chemical companies. How are global chemical players addressing this through market intelligence?

A total of 64 chemical companies responded to a range of questions on the state of and their plans for their intelligence functions in the 2011 Global Market Intelligence Survey by M-Brain (formerly Global Intelligence Alliance). We ask Timo Maisila, a consultant from M-Brain (formerly GIA), for some comments on the findings from the survey.

Could you describe the current state of market intelligence at chemical companies?

“The total average budget among the 64 investigated chemical companies is €2 million, which is fairly low compared to other related industries. The HR costs make up about 50% of that budget.

Organizations annual market intelligence budget_web

Source: 2011 Global Market Intelligence Survey by M-Brain (formerly GIA)
*Click on image to enlarge

The relatively smaller market intelligence budgets could be due to a focus on technical issues and day-to-day business by top management instead. Other possible reasons could be a lower number of transactions and disruptive changes compared to other relevant industries.

Interestingly though, 100% of the respondents say they benefited from market intelligence. This is exceptional among relevant industries.

Our organization has benefited from systematic Market Intelligence_web

Source: 2011 Global Market Intelligence Survey by M-Brain (formerly GIA)
*Click on image to enlarge

The level of satisfaction on the other hand, could be improved. Only 38% agreed strongly that they benefited from systematic market intelligence. The difference is significant when compared to the satisfaction level (61%) in Consumer & Retail industry for example. The respondents also said that 25% of their intelligence requests cannot be fulfilled at the moment.

Overall, it would seem that level of market intelligence could be improved within the chemical industry.”

How can standards be raised?

“The only way to increase the share of highly satisfied end users is to learn from other industries. The market intelligence can be so much more insightful than just listing prices, M&A activities, new patents, product launches and developments in capacity.

The technical B2B experts are a tough crowd with their specialized needs. Similar to other industries and managers on the whole, they want to be able to communicate on their level of expertise. Analysis that meets this need cannot always be delivered in bulk.

These are only 2 very broad examples as each company has different market intelligence needs. Ultimately, it is most effective if an expert in market intelligence reviews the scope, processes, deliverables, tools, organization and culture of each company, as described in M-Brain (formerly GIA)’s World Class Market Intelligence Roadmap.”

What is the potential for the development of market intelligence at chemical companies?

“About 70% already have a systematic market intelligence operation in place. The share may go up to 85% by 2012 according to our respondents’ plans to invest in setting up market intelligence functions.

Existence of Market Intelligence Programs_web

Source: 2011 Global Market Intelligence Survey by M-Brain (formerly GIA)
*Click on image to enlarge

It seems that chemical industry players plan to increase their overall investments in market intelligence more than other industries. This is good news, seeing that there is still room for improvement.”

How do you anticipate your investment in MI to develop in 2 yrs_web

Source: 2011 Global Market Intelligence Survey by M-Brain (formerly GIA).

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