Page 28 - (DK) The Business Book

26 STUDY THE COMPETITION

senior managers may have a full is “market mapping” (also known as “leisure.” Additional factors could
view of the company, but their “perceptual mapping”). Market maps include the item’s price (high vs.
perspective needs to be informed are diagrams that represent a market low), quality of production (high
by alternative views from all levels and the placement of products within vs. low), stylish vs. conservative,
of the organization. that market, providing a visual or durable vs. disposable. Two of
As with all business tools, the means of studying the competition. these dimensions, or opposing
factor that governs the success of The process is useful both internally pairs, are then plotted onto a
SWOT analysis is whether or not (to help an organization understand horizontal or vertical axis.
it leads to action. Even the most its own products) and externally (to Based on market research or the
comprehensive analysis is useless chart how consumers perceive the knowledge of managers, all of the
unless its findings are translated brand in relation to the competition). products within a particular market
into well-conceived plans, new To draw up a market map, a can be plotted onto the map. The
processes, and better performance. company identifies several consumer market share of each product can
purchase-decision factors that be represented by the size of its
Market mapping stand in opposition to one another. corresponding image on the map,
A slightly narrower but more In the fashion market, an example but more often, analysts choose to
sophisticated tool for analyzing a might include “technology” vs. simply make a rough sketch of the
company’s position and competition “fashion,” and “performance” vs. market, ignoring market size.
A company may choose to
compile several market maps, each
Market mapping plots opposing qualities of products of which depicts a different set of
along two axes. By identifying the two main oppositional
factors for any product, it is easy to see gaps in the market. variables, and then analyze them—
individually and in combination—
to gain an overall view of the
PERFORMANCE company’s position in the market.
Speedo
Finding the gap
TYR
The goal of market mapping is
to identify opportunities where a
company can differentiate itself
ZXU
Market gap? from its competitors. These are
areas where the company offers
Adidas unique value, and they can be used
to inform marketing messages. The
Nike O’Neill
map will also reveal overcrowded
Puma
Quicksilver segments, which signify
Slazenger heightened competitive threat.
For a new start-up, a market
TECHNOLOGY Ripcurl Billabong FASHION map can be used to identify a
viable gap in the market—a good
place to position a company when
it is struggling to establish itself.
Market gap? Established businesses can use
Gottex market mapping combined with
SWOT analysis to discover
H&M opportunities and decide whether
the company has the strengths to
Bravissimo exploit one of those opportunities.
The market map helps to inform
Tommy Hilfiger the strategy (the need to reposition
LEISURE a product away from competitors’