Competitive Analysis
A BNET Professional Development
Tool
Version 2.0
January 29, 2007
Competitive Analysis
Who are my competitors?
How do I analyze them?
SWOT Analysis Porter’s Five Forces Strategic Group Maps PEST analysis
There are many ways to analyze
your competitors; we’ve selected
Strategic group map of the video game industry the strategic group map technique.
High
Game publishers After answering a few questions,
you’ll be ready to draw a strategic
Complexity Sony, Sega, Nintendo map for your industry. This map will
of game illustrate the competitive forces
Arcade owners within your industry, your
Low
competitive position, and your
Arcades Consoles PCs
competitors’ positions.
Distribution channels
Creating a strategic group map
1. Identify the two top competitive
factors in your market.
One competitive factor should be High
expressed in a high to low range.
The other variable is more flexible, Product
price
but should still reflect the most
important competitive factor in Low
your market. These two factors will
High
be the X and Y map variables. Broad Narrow
Strategic focus differentiation
Market
penetration
Low
High
Specialty focus Broad range Low cost focus
Product line mix
Brand
image
Low
Possible axes for your strategic map
Direct mail Retail stores Online
Distribution channels
Creating a strategic group map
2. List your five nearest competitors.
1. (Direct)
These can be indirect or direct
competitors but should be companies
that compete closely with your product 2. (Direct)
or service.
These are the strategic groups that you’ll
plot on your map. 3. (Direct)
4. (Direct)
5. (Indirect)
Creating a strategic group map
3. Create groups of competitors that fall into the same strategic space.
Looking at the list from Step 1 and the criteria from Step 2, assess each competitor’s
strengths and weaknesses against the competitive factors. You should have 2-3
groups. Include your own company in one of the groups.
Consider strengths that the companies have individually and strengths that they
share.
Consider unique characteristics of each company’s product or service as well as any
feature a company’s product or service lacks.
Consider market share, marketing approach, and product mix as well as any other
relevant, industry-specific factors.
4. Plot the strategic groups from Step 3 on your map.
Draw circles around each group, making circles proportional to the size of each
group's share of total industry sales.
Build your own map
Fill in the text boxes below with the information you’ve gathered in the previous slides. Adjust the size
of the circles as needed and place them in the map.
High Title of map goes here
List strategic group
members here
Competitive
factor #1
goes here
List strategic group
members here Low
Range of factor
Competitive factor #2 goes here
List strategic group
members here
Review your new map
Assess both the overall map and the position of each In his book, Competitive
group. Strategy, Michael Porter
Are there any “empty” areas on the map that you or one of your recommends these analytical
competitors could move into by revising an existing product or steps:
launching something new? Identify mobility barriers: Look
Could you improve your strategic position by moving to a at the qualities that protect each
different strategic group? group from attack by other
groups. This can help you to
What advantages do your competitors have that you lack? Are predict threats to the groups.
they significant to your position on the map or not?
Chart directions of strategic
If there are more than two important competitive factors in your movement: Draw arrows from
industry, you can draw additional maps to get a more complete each group that represent the
analysis of your competitive environment. direction in which the group
seems to be moving in strategic
space.
Predict reactions: Firms in the
same group often react to an
industry event in the same way.
Learn more about competitive analysis
These white papers and presentations on [Link] review other techniques for
competitive analysis and provide more background information.
Industry And Competitive Analysis
Your Competitive Analysis Expanded
How to do a Strategic Analysis
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