From Business Intelligence to Competitive Intelligence: Inferring Competitive Measures Using Augmented Site-Centric Data

48 Pages Posted: 8 Jan 2009 Last revised: 4 Apr 2012

Eric Zheng

University of Texas at Dallas

Peter Fader

University of Pennsylvania - Marketing Department

Balaji Padmanabhan

University of South Florida - College of Business Administration

Date Written: February 11, 2011

Abstract

Managers routinely seek to understand firm performance relative to the competitors. Recently competitive intelligence (CI) has emerged as an important area within business intelligence (BI) where the emphasis is on understanding and measuring a firm's external competitive environment. A requirement of such systems is the availability of the rich data about a firm's competitors, which is typically hard to acquire. This paper proposes a method to incorporate competitive intelligence in BI systems by using less granular and aggregate data which is usually easier to acquire. We motivate, develop, and validate an approach to infer key competitive measures about customer activities without requiring detailed cross-firm data. Instead, our method derives these competitive measures for online firms from simple “site-centric” data that are commonly available, augmented with aggregate data summaries that may be obtained from syndicated data providers. Based on data provided by comScore Networks we show empirically that our method performs well in inferring several key diagnostic competitive measures – the penetration, market share and the share of wallet – for various online retailers.

Notes: added wharton-darcey 4/4/12

Keywords: Business Intelligence, Competitive Intelligence, Competitive Measures, Probability Models, NBD/Dirichlet

JEL Classification: C25, C5, C61

Suggested Citation

Zheng, Eric and Fader, Peter and Padmanabhan, Balaji, From Business Intelligence to Competitive Intelligence: Inferring Competitive Measures Using Augmented Site-Centric Data (February 11, 2011). Available at SSRN: https://ssrn.com/abstract=1323587 or http://dx.doi.org/10.2139/ssrn.1323587

Eric Zheng (Contact Author)

University of Texas at Dallas ( email )

2601 North Floyd Road
Richardson, TX 75083
United States

Peter Fader

University of Pennsylvania - Marketing Department ( email )

700 Jon M. Huntsman Hall
3730 Walnut Street
Philadelphia, PA 19104-6340
United States

Balaji Padmanabhan

University of South Florida - College of Business Administration ( email )

4202 E. Fowler Avenue, BSN 3403
Tampa, FL 33620-5500
United States

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