How to Create a Market Map

How to Create a Market Map

A market map is a visual representation of the competitive landscape in a particular market. It helps you understand:

• Key players: Who are the main competitors in the market?
• Their positioning: How are they perceived by customers?
• Market segments: What are the different customer groups in the market?
• Your own position: Where do you fit in the competitive landscape?

Steps to Creating a Market Map:

1. Define your market:

   • Identify the industry or product category you are interested in.
   • Determine the geographic scope of your market.
   • Consider the specific customer segments you want to target.

2. Identify key players:

   • Conduct market research to identify the main competitors in your market.
   • Consider factors like market share, revenue, brand awareness, and customer base.

3. Choose your axes:

   • Select two key dimensions or criteria that are relevant to your market and how customers perceive competitors.
   • Examples:
     • Price vs. Quality
     • Features vs. Simplicity
     • Innovation vs. Tradition
     • Target customer segment vs. Product category
     • Service vs. Product

4. Position competitors:

   • Plot each competitor on the map based on their position on the chosen axes.
   • Use different shapes, colors, or sizes to distinguish competitors.
   • Consider using data points like market share, customer reviews, or analyst reports to support your positioning.

5. Mark your own position:

   • Place your company or product on the map based on your own positioning on the chosen axes.
   • This will help you understand where you fit in the competitive landscape and identify potential opportunities and threats.

6. Analyze the map:

   • Look for clusters of competitors and market segments.
   • Identify any gaps or underserved areas in the market.
   • Analyze the competitive intensity in different areas of the map.

7. Use the map for strategic planning:

   • Identify potential opportunities for growth and expansion.
   • Develop strategies to differentiate your company from competitors.
   • Track changes in the competitive landscape over time.

Example of a Market Map:

       +---------------------------------+
       |  High Quality                   |
       |                                 |
       |  Company A  •  Company B  •     |
       |                                 |
       |                                 |
       |                                 |
       |  •  Company C      •  Company D  |
       |                                 |
       |  Low Quality                   |
       +---------------------------------+
       Low Price                      High Price

This market map shows the positioning of four companies based on their perceived quality and price. Company A and B are positioned as high quality and high price, while Company C and D are positioned as lower quality and lower price. This helps to visualize the competitive landscape and identify potential opportunities for differentiation.

Tips for Creating Effective Market Maps:

• Use clear and concise language.
• Keep the map visually appealing and easy to understand.
• Regularly update the map to reflect changes in the market.
• Use the map to guide your business decisions and strategic planning.