Challenger MI Blog

"I did six years of planning to win the Championship from Jack Dempsey", said Gene Tunney, the epitomical challenger-turned-champion, "boxing's brainiest", and a very credible businessman too.

In the view of boxing journalist Mike Casey: "Tunney...ranks very high...in his ability to assimilate and analyse data and effectively act upon it...He studied his opponents in depth and knew their every move before he entered the ring...With typical foresight and calculated planning, Gene Tunney had been tracking Jack Dempsey for some time."

The ultimate challenger, he toppled Dempsey - the seven-year champion, an American icon and the first boxer to gross over $1m in a fight - twice!

White Paper: Altering Course to Provide Clarity in Murky Waters

“We’re not in the shipping business; we’re in the information business.” Peter Rose, Founder of Expeditors.

The UK’s freight forwarders are an important cog in UK PLC’s export machine – a machine that is ramping up in the wake of the Brexit vote, with the fallen pound making our products more competitive overseas, and with a government drive to increase exports, particularly among small- and medium-sized enterprises (SMEs). Exports have already risen since the Brexit vote, and are growing at the fastest rate in six years (CBI); and freight forwarders are there – particularly for those taking uncertain first forays into international markets – to organise shipments, as experts in the logistics network. They offer a variety of services, with some more diversified than others, from packaging and sending single items, to warehousing large shipments, to fully-operating as a company’s outsourced export department. And, of course, they act as import agents too.

This is a highly competitive industry, and particularly so given research from the US by consultancy firm A.T. Kearney – a good firm, with whom I have worked in the past – that showed the levels of profitability achievable in freight forwarding, with the top companies achieving a return on capital (ROC) akin to that of Apple.

From where I am based, near Telford – right on the M54, 25 miles from the M6, 29 miles from the M5, 40 miles from Birmingham Airport, and 80 miles from the port at Liverpool – there is a robust local road freight sector. Looking at the SIC code that most such companies file under, there are 1,261 firms in the immediate vicinity covering TF (133), SY (179), WV (441) and ST (508) postcodes. Turning to freight forwarding specifically – given only a small portion of these will be forwarders – the membership of the British International Freight Association (BIFA) shows 67 members within a 25 mile radius of Telford – which, clearly, is competition enough. They are mapped below, noting the gatherings along motorway corridors around the Black Country and West Birmingham – they are often treading on each other’s toes on the same business parks or streets.

SMEs: Use Freelancers to Fill Your Analytical Skills Gaps

Recent research from PeoplePerHour shows that 67% of small- to medium-sized enterprises (SMEs) are now using freelancers to fill skills gaps in their companies, with a 4:1 ratio of freelancers to employees in those that do – a real demonstration of the flexibility in our SME market; and great for Challenger MI, specialising in market and competitive intelligence for industry Challengers and SMEs, given that they comprise 99% of our economy: around 3.5m potential customers!

The main reason for using freelance talent, cited by 55% of respondents, is to fill roles that companies currently lack the skills for; followed by gaining increased capacity and flexibility, cited by 37% of respondents.

These are strong arguments in favour of acquiring freelance talent, and they are as applicable to my profession – the market and competitive intelligence discipline – as to any other niche or specialist discipline, for a number of reasons. This is particularly so as most SMEs, unlike their larger competitors, do not have the capacity to employ analysts full-time.

Firstly, market analysis is a specialist skill-set, and especially so when it comes to analysing large datasets – both quantitative and qualitative – particularly in the form of survey responses or large amounts of sales data, for example. Not only is the analysis itself technical, but there is also a skill to initially asking the right questions, and then disseminating the findings in such a way as to ensure that action is taken upon them.

Research from LinkedIn, reported by the World Economic Forum, showed that, for 2017, the second most in-demand skill of all is statistical analysis and data mining; and the eighth most in-demand skill is data presentation and visualisation. Challenger MI does both on a freelance basis with, for example, the image below showing the visualisation of tens of thousands of data points relating to export markets for a micro-business that we looked at recently.

Secondly, freelancers add greater capacity and flexibility to an SMEs workforce; and, once more, analytical work is a prime example of where this is needed, as I all-too-often see it tacked on to another person’s job. For example, I recently looked at a job description for a ‘Marketing Manager’ at a local medium-sized company. In the job description, the employer outlined 28 responsibilities, and 11 desired skills; and, in total, six of these related to market intelligence. Five of the 28 responsibilities (18%) did so, suggesting that the Marketing Manager should spend roughly one day a week on them.

Given that this person’s role also includes the full spectrum of marketing – from web design and management, to branding, e-commerce, advertising, social media, packaging, PR – it is simply not possible for them to cover all of that and have the requisite expertise for market analysis, nor the time to do the work justice. It is an excellent opportunity to bring in a freelance analyst, for that one day a week, to get that work done to the utmost standard, while also freeing up the Marketing Manager’s time for the other 23 responsibilities on that list.

Furthermore, I make the point above that it is a specialist skillset; but, further, it is more than that: a specialist mind-set, too. Nowhere is this more perilous, in my opinion, than in the marketing field, given that analytical work requires left brain dominance, while marketing work – the advertising, the PR, outlined above – requires right brain dominance. There are often fundamental differences in personality and mind-set between these two types of people.

From another blog, here.

Thirdly, the use of freelancers brings in a fresh pair of, objective, eyes. This is particularly important in market and competitive intelligence, given the absolute necessity for objectivity, impartiality and the requirement to overcome bias – perhaps particularly where competitors are concerned – in your analysis.

Think about a customer survey, or a win/loss analysis programme: your customers are far more likely to give honest responses, from which a company can learn the most, if they know that they are talking to someone independent of the company – perhaps Market Research Society qualified, as in my case (!) – and who guarantees their anonymity.

Where competitor products are concerned, a company will, inherently, think that its products are superior – but are you seeing this from the same perspective as your customers? Bringing in an outside analyst helps to overcomes these biases; and others, too, such as confirmation bias, which is a particular pitfall for those inexperienced in analytical techniques.

Conclusion

Two-thirds of SMEs enlist the help of freelancers, but what I would really like to see, perhaps next from PeoplePerHour’s research, is the subsequent differences in performance between those companies that do and those that don’t – there are huge benefits to be gained from the flexibility and access to skills, and I would hypothesise that it is reflected in company performance.

Freelance analysts – the second most in-demand skill – should be at the forefront of this. SMEs’ larger competitors are recruiting stattos, and can accommodate employing full-time analysts. SMEs risk falling behind if they don't keep up with the big data evolution.

But more so than anything, I wholeheartedly believe that SMEs stand to gain greater competitive advantage from market intelligence due, among other things, to the reduced lead time between the production of intelligence and the action that can be taken upon it.

Hiring a freelance market analyst enables SMEs to exploit this competitive advantage and – as with all of the freelancing above – access these skills on the basis, and cost, upon which they need them. I work with SME clients highly flexibly on an ongoing, temporary, or project basis.

Indeed, I believe so passionately in these principles that I offer one day of work a week at minimum wage to local micro-businesses and start-ups, so that they can access a skill-set and mind-set that they otherwise wouldn’t be able to.

MBA-level analysis for minimum wage – I call it putting my money where my mouth is.

If your company is interested in adding market analysis expertise and capacity on a freelance basis, then contact me here.

Statistical analysis is no.2 and data presentation is no.8 - talk to me if your company needs either of these skills #freelance #consultancy https://t.co/FAoYGFxZU6

— Challenger MI (@Challenger_MI) January 14, 2017

Let's Fire Shropshire Back into the Export League Table

There is nothing quite like a league table to focus minds. I know this through my intimacy with university league tables, noting Shropshire’s recent success on this front as Harper Adams University ascended to the lofty heights of No.1 ‘Modern University of the Year’, and the top 50 overall, in The Times and Sunday Times Good University Guide; whilst also being the second fastest riser in the Complete University Guide. Once we – people, companies, universities, football teams – are ranked alongside each other, it invokes our inherent competitiveness, one of the key drivers of productivity.

Which is why – as the self-declared Bad Boy of Benchmarking – I could not pass over the SME Export Track 100, published by The Times in February 2017, without getting the competitive juices flowing. This particular league table ranks the top 100 UK SMEs by their rate of export growth over a two-year period.

PROBLEM

The interactive map below pinpoints each of the companies in the top 100, showing that there was not one Shropshire company in the rankings. There were nine Midlands companies, including two from the Black Country – one of which, Stiltz Lifts in Kingswinford, came 7th overall – and one from Staffordshire. Six of the top 100 are from the West Midlands which, given that the region contributes 7.3% of national Gross Value-Added (GVA), is not too bad. London is, of course, a hotspot, along with a ring around the M25 that encompasses the wider South East. Also the North West, around Manchester; Yorkshire, close to Sheffield and Leeds; Glasgow; and a half circle around the south of Birmingham. 

Trump: what the left-brain saw, but the right-brain didn't

So, this blog takes a few tangents, and here is the first: I have noticed, increasingly, that I think in tangents. Two practical manifestations of this include my tendency to use em dashes in my writing, which – according to Grammar Book (case in point) – are used to indicate, "an interruption, or an abrupt change of thought" (aka, a tangent!) And, secondly, instead of the usual A4 or A5 notepad – or, increasingly, a tablet of some description – that is the accompaniment of virtually everyone in the world of work, I have started using an A3 clipboard and paper, because it enables me to better visualise all of the tangents I take in any given meeting!

[Incidentally, this very blog is a tangent: I told myself I was going to do all sorts of other things tonight, but – having spent my morning bike ride thinking about this (another one, I’ll try to do one per paragraph) – couldn't resist spending my evening writing it.]

The Father of Advertising’s Research Imperative

The picture below piqued my interest as I scrolled down my LinkedIn timeline recently; not because I have any expertise in advertising or copywriting – I am overwhelmingly left-brain dominant, and not particularly creative – but because of what this says about the creative process (largely a right-brain pursuit) in its entirety. Namely, that according to 'The Father of Advertising', it is still grounded in comprehensive research (a left-brain pursuit).

[Ogilvy’s 1955 letter, abridged]

Shropshire, We Need to Talk About Productivity

The Office for National Statistics published the latest productivity figures last week (6 Jan 17), for Q3 2016, showing that national productivity was up 0.4% on the quarter, and 1.1% on Q1 2008, and hence, “the productivity puzzle remains.”[1] Alongside these, they also published productivity data at a sub-regional level, although this lags the overall data with the most recent publication running to the end of 2015.

0.4% growth in labour productivity on an output per hour basis in Q3 2016 https://t.co/4t5Q3aE9jv

— ONS (@ONS) January 6, 2017

BREXIT: Exporters, Don’t Forecast Long-Term Decline

The Institute of Export has recently released the results of a survey of its members, post-Brexit referendum. There is one finding that has astounded me: 42% of respondents said that, in the event of removal from the Single Market, they expect their business to shrink in the long-term. I have one, provocative, question: what on Earth are these businesses doing between now (or, the recent past) and then?

Budgens, Beware the Middle or Trying to out-Waitrose Waitrose

Michael Porter’s Competitive Strategy is somewhat of a Market Analyst’s Bible. Porter advanced the notion – among many others – that there are, broadly, three generic strategies:

• Differentiation, think Waitrose.
• Cost Leadership, think Aldi.
• Focus, think your local corner shop with its focused geographical market of a few hundred homes.

Michael Porter's Generic Strategies

Challengers Can Become 'Super-Forecasters' for Competitive Advantage

BOOK REVIEW: ‘Super-Forecasting: The Art and Science of Prediction’, by Philip Tetlock & Dan Gardner

As a Market Analyst – having worked in a variety of environments from global businesses to academia, consultancy to the military – forecasting is a crucial skill; and, according to this book, "forecasting is a skill that can be cultivated." In one of those aforementioned, cliché-ridden, environments I have oft heard such statements as: “We’re here to forecast the weather, not read the news”; or, even more self-aggrandisingly amusing: “We are prophets, not historians.” Whatever; it remains the case that a central tenet of the role of an Intelligence Analyst is to make assessments about the future.

But, fascinatingly, the central premise of this superb book, ‘Super-Forecasting: The Art and Science of Prediction’, is that, actually, those who are often trumpeted as ‘experts’ at such things – from economists, to political journalists, to the CIA – are actually no better at it than laymen or, even, “a dart-throwing chimp.” OK, it’s a lot more nuanced than that, as the author Philip Tetlock – whose research coined the infamous anecdote about that talented chimp – would point out, but the point stands.

Shropshire Needs a Kickstart!

‘Crowdfunding’ entered the Oxford English Dictionary in 2011, and is defined therein as, “the practice of funding a project or venture by raising money from a large number of people who each contribute a relatively small amount, typically via the internet.” Essentially, with a new business or project idea, one can seek to raise funds from friends, family and the general public online, instead of going to banks or the ‘Dragons’ Den’.

The global Crowdfunding industry is growing exponentially, having raised an estimated $6.1 billion in 2013, $16.2 billion in 2014, and more than doubling again to $34.4 billion in 2015.[1] The World Bank forecasts that it will be worth $93 billion by 2025 – perhaps a conservative estimate considering recent growth – as it is set to top the venture capital market ($45 billion) in the near future.[2] Figure 1 shows the recent growth, alongside a growth curve to the World Bank’s 2025 estimate based on compound annual growth rate (CAGR, dotted green) and what is a more likely convex curve following recent growth (dotted black).

Figure 1

BREXIT: Chaos and Opportunity

“In the midst of chaos, there is also opportunity.” Sun Tzu.

OK, OK, “chaos”, is a bit hyperbolic! But it’s apt, perhaps, that the great Chinese general – now unwittingly eponymous with board room slogans the world over – made this observation, given that China is among the countries already seeking trade deal talks with a post-Brexit UK.

An adaptation on the Chaos Symbol

Shropshire's Productivity - A Little Less Puzzling

The UK’s ‘productivity puzzle’ has been described by Chancellor George Osborne as, “the challenge of our time”, and is, according to the Office for National Statistics, “unprecedented in the post-war period.” Despite the general economic recovery from the 2008/09 recession, productivity – essentially the amount of output firms produce for the amount of input expended, measured by gross value-added (GVA) per hour worked – has flat-lined, as shown in Figure 1. 

Figure 1, Source: Office for National Statistics

SMEs, Why the Export Uncertainty?

Half of small businesses cited market intelligence (MI) as a major challenge to exporting, according to a recent report published by the Enterprise Research Centre, based partly at my own alma mater at Aston Business School. Likewise, a seminal study from the OECD and APEC cited "identifying foreign business opportunities" and "limited information to locate/analyse markets" as the second and third most significant barriers for SMEs, with the latter the most frequently cited. But this need not be the case, as data on overseas markets – for almost any product – is plentiful; the challenges, therefore, are in the awareness of this fact, and having the inclination, capacity and skills to utilise this data to reduce uncertainty and identify opportunities.

Mischievous Zagging and Customer Segmentation

Now there’s a sentence I never thought I’d write! Anyway…

One social trend highlighted by many observers over the last couple of decades or so is that towards increasingly thin skin, resulting in what is often rather disparagingly called 'political correctness'[1] – the notion that freedom of speech is being curtailed by the fear of causing offence, epitomised by people being investigated for posting 'offensive' views on social media. It's all a little bit Orwellian, conjuring up notions of ‘thoughtcrime’ (socially unacceptable thoughts) and ‘newspeak’ (the use of language to eliminate personal thought).

But some of my favourite Challenger branding and promotional efforts of late appear to be fighting almost directly against this trend. These are what Adam Morgan, in Eating the Big Fish – a seminal book on Challenger Brands – called 'The Enlightened Zaggers': "brands that deliberately swim against a prevailing cultural current...'I know the world buys into this’, they say, ‘but I am calling it for the BS it really is’."[2]

Win/Loss Analysis and Wladimir Klitschko: Champion to Challenger and Back to the Drawing Board

In November 2015, the seemingly unbeatable heavyweight champion of the world, Wladimir Klitschko – who had not lost in over eleven years – was dethroned by upstart British challenger, Tyson Fury. Klitschko was the second longest-reigning heavyweight champion in history, and second in the list of most wins in title bouts. I think there are lessons to be learnt here about one of the most powerful market and competitive intelligence approaches: win/loss analysis; and so, too, does Dr Steelhammer himself.

Image source: Reuters / Kai Pfaffenbach

A short while after the defeat, Klitschko wrote an article on his LinkedIn page – always interesting reading from a man who holds a PhD, has many business interests outside of boxing, and who has a brother active in Ukrainian politics (former heavyweight champion, Vitali). “You have the power to turn defeat into victory”, he said, before going on to demonstrate how he has done that – and plans to again – through comprehensive analysis of his defeats. At this point, it is worth quoting from the article at length:

Hamlet & Horatio – Business Development Managers & Analysts

‘Business Development Manager’ – it’s one of those job titles that has as many definitions as it has people in the role: 1,869 within a 25 mile radius of my location (in Shropshire), in fact, according to LinkedIn. BDMs range from senior sales people, perhaps most frequently, to those heavily focused on innovation and new products, and those focused on new strategic markets. The premise of this article is that, regardless, BDMs – perhaps more so than anyone else in a company – should have a Market Analyst at their right hand, as a sidekick, or a Horatio to their Hamlet.

Horatio, Hamlet and the Ghost; by Henry Fuseli

Let me explain the analogy: Shakespeare’s Hamlet is commonly spoken of as an enigma, persistent (in trying to prove King Claudius’s guilt), enthusiastic, energetic, and occasionally rash and impulsive[1]; “words are Hamlet’s constant companions” – he has the gift of the gab, one might say. He possesses similar traits to those required in business development or sales. (Funnily enough, Hamlet is often compared to another play, Death of a Salesman, but I’ll stop there!)

Market Intelligence is Key to Challenging

Challengers, in any industry, have to work harder than the market leader – a point succinctly made straight off the bat in one of the seminal books on ‘Challenger Brands’, Eating the Big Fish by Adam Morgan. It is epitomised by the tagline of one of the pin-ups of Challenger branding, Avis, when challenging Hertz in the 1960s: “When you’re only no.2, you try harder. Or else.”

And Challengers have to work smarter too; firstly, to establish the plains upon which they can challenge the leader; and, secondly, because they often do not have access to the same resources as their bigger rival(s) – Challengers have, “greater ambitions than resources”[1], according to Morgan. And this is why market and competitive intelligence (MI and CI) are integral to companies in Challenger positions – John Gumas, another leader in the field, questions whether these companies are underestimating the power of competitor analysis in his book, Marketing Smart.[2]

Challenger brands are, by definition, not the number one and nor are they niche; they have a mindset whereby ambitions exceed resources, and an acceptance of the implications of this gap; and they are pursuing a high growth strategy.[3] They are not always, but often are, small- to medium-sized enterprises (SMEs) and, if this is so, it is unlikely that they employ full-time market analysts as large companies tend to do. Indeed, Morgan also draws the link between Challengers and ‘Guerrilla Marketing’ – you can read my piece on how three infamous guerrillas would have advised SMEs to approach MI and CI here, with all of these points relevant to Challengers too.

SWOT Analysis - death by bullet-point!

SWOT analysis may be the most frequently used analytical tool in business; the preserve of management courses the world over, rolling off the corporate tongue with ease. But it is also the most frequently under-utilised analytical tool, all-too-often met with a collective rolling of the eyes, with an output that all-too-often ends up as an appendix in the strategic document to which it is contributing. 

A Guerrilla Approach to Market Intelligence

Small- and medium-sized enterprises (SMEs) can utilise a ‘guerrilla’ approach to market and competitive intelligence (MI & CI) to outmanoeuvre their larger rivals, and gain competitive advantage. This introductory blog calls on the thoughts of some leading guerrillas with regards to intelligence operations, applying those to a business context to begin to outline a framework for guerrilla MI.

The broader guerrilla marketing discipline – which originated to help small businesses compete with their larger rivals, primarily focused on advertising – is well-founded, particularly in the USA. So much so that Google has more hits for ‘guerrilla marketing’ than it does for ‘guerrilla warfare’! However, the theory and practice of this discipline has only paid lip service to the notion of MI & CI, with generalised talk of market and customer research and how it can be done cheaply – mostly platitudes that could come straight from any business text book.