Evolving competition among chemical companies is a recurring threat

According to the 2009 global market intelligence survey, evolving competition is the top concern of global market intelligence professionals in the chemical industry, but there are plenty of opportunities to promote sustainable growth and environmental improvement. From oil, natural gas, lubricants and plastics to agrochemicals, performance products and biotechnology, the chemical industry is undergoing important changes. How will they use market intelligence in 2010 / 2011?

The 2009 global market intelligence survey conducted by m-brain (formerly known as the global intelligence alliance) summarizes the responses of 38 senior market intelligence executives from global or regional chemical organizations and provides some interesting insights.

Evolving competition is a recurring threat

Although overcapacity, rising raw material costs and infringement of intellectual property rights are still worrying issues, the most common threats come from emerging and evolving competition.

Market intelligence executives point out that smaller, more flexible companies enter the market faster, while gaining attractive professional margins. They also saw greater influence from new competitors who were opportunistic during the recession.

The biggest business opportunities lie in the change of environment and the development of new products or applications

Due to its wide range of organic and inorganic primary materials, primary products and almost all final products, the chemical industry is a central branch of the global structure and has a huge impact on environmental development.

Chemical companies are seeking to improve process efficiency and make greater integration within the plant, such as utilizing the waste heat or by-products of adjacent processes, energy demand and transportation of more products processed on site. At the same time, in the development stage, there is a growing demand for innovative products with quantitative ecological performance.

The director of chemical market intelligence sees strong opportunities to achieve sustainable development and expects more research and understanding of green technologies and applications, such as sustainable animal protein production or photovoltaic development, as well as the specific ecological requirements of customers and end users.

Other opportunities are to find new applications for existing products based on industry or geographical location, and develop differentiated products closer to customer needs.

In the chemical industry, the market intelligence function is mature and efficient

According to the global market intelligence survey in 2009, the chemical industry is the second largest user group of system market intelligence. Their user base is 74%, slightly lower than that of technology and media (75%).

Such leadership is also reflected in the widespread use of information to support important business decisions (66% of respondents visit important information only after a short delay), the majority of respondents claim that decisions are largely effective (53%) and market intelligence is used for most / many key decisions (75%).

One third of the market intelligence teams are organized by strategic planning and business development, while the majority are organized by sales and marketing. This points to the operational and tactical nature of intelligence collected from chemical companies.

Chemical companies see the need for more market intelligence during the period of economic improvement, and will continue to invest in market intelligence

For chemical companies, the intention to moderately increase market intelligence activities is very high (75%) when the economy is improving, and half of the respondents plan to moderately increase market intelligence investment in the next two years.

Given that the average market intelligence budget is at the top of all industries (US $350000 to US $700000, second only to technology and media and pharmaceutical and healthcare), this makes the chemical industry one of the major contributors in the field of market intelligence.

The popularity of market intelligence in the chemical industry is also reflected in the fact that the importance of market intelligence to the company has not changed during the economic downturn.

Looking ahead, attention to the North American and European markets is likely to increase, while attention to the Asia Pacific region is likely to decrease, which may be related to seizing upward opportunities in regions more severely affected by the crisis.