Market Mapping

Advantages and Disadvantages of Market Mapping

Market mapping serves as a valuable tool for businesses looking to gain insights into the competitive landscape, identify market trends, and develop strategic plans. Market mapping allows companies to spot opportunities and potential challenges by visually organising information about competitors. Now, we will discuss the advantages and disadvantages of market mapping, shedding light on its benefits and limitations as a strategic analysis technique.

Benefits of Market Mapping

Some of the advantages of perceptual mapping:

• Provides a visual representation of information.

• Clear and easy to interpret when the marketer needs to make a quick decision.

• Helps marketers understand market segments.

• Based on quantitative data.

• Useful for market researchers.

• Helps evaluate the performance of marketing campaigns.

• Illustrates changes in customer preferences.

• Tracks how new product developments are performing in the market.

Limitations of Market Mapping

Some of the limitations of perceptual mapping include:

• It represents a very simplistic version of consumer decision-making.

• It is often time-consuming and expensive to collect this type of data.

• There can be differences between the customer's perception of a product and the actual qualities of the product.

Market Mapping Example

Let's now take a look at an example of a perceptual map.

Fig. 2. Makeup Brands Perceptual Map, StudySmarter Originals

Marketers of a new makeup brand have decided to survey consumers on their attitudes and perceptions towards a list of existing makeup brands. Figure 2 above represents the perceptual map the researchers have constructed.

You can see that the two dimensions being used to represent the position of each brand are price and quality. Tom Ford Beauty and Guerlain are placed as the makeup brands that offer the highest quality product for the highest price (top right quadrant). Elf Cosmetics is placed as the lowest price, lowest quality product (bottom left quadrant). Further, we see that Rimmel London and Elf Cosmetics are competing closely in the low-price and low-quality segment. The market map also shows a potential gap in the market, in the lower-priced, mid-quality segment. This could potentially be an effective way to position your new product - targeting the low-price, high-quality segment.

On the other hand, the same makeup brands could also be plotted on a market map based on two different dimensions. For example, if the two dimensions being used were 'cruelty-free' and 'convenient packaging' the makeup brands would be positioned differently, resulting in a completely new market map.

Perceptual Map Marketing

A perceptual map in marketing is a visual representation that shows how customers perceive various products or brands in relation to one another. It helps businesses understand consumer preferences and identify potential opportunities for differentiation based on specific attributes that matter to the target audience.

Positioning Map Marketing

A positioning map is a visual tool that illustrates how different products or services compare to one another within a market based on specific attributes or factors. It enables businesses to identify their competitive position and uncover potential opportunities for differentiation.

The positioning map is represented on a scatter plot diagram, and it maps the positioning of competitors in relation to the brand. The market is mapped based on two dimensions (for example, price and quality), similar to a perceptual map. A positioning map is useful for spotting gaps in the market and understanding where your competitors have positioned themselves in the market. It is also useful for planning purposes - to figure out where you would ideally want your product or brand to stand in relation to competitors.

A positioning map is useful for understanding competition in a given market. It is, however, important to understand that different types of competitors can compete with your product, even if these competitors position themselves differently on the market.

This is why positioning maps are important for examining current competition, positioning, and identifying gaps in the market. A positioning map also shows which brands or products are market leaders and which ones follow behind.

Positioning map benefits

There are a couple of reasons why a business would use a positioning map:

• To analyze competition and competitors' positioning.

• As a tool that helps market researchers.

• To help marketers differentiate their products and brands.

• To understand the product positioning aspect of the marketing mix.

• As a tool to help create an effective marketing strategy for new products.

• To adjust existing strategies for their current product/brand offering.

Positioning map limitations

Some of the disadvantages of a positioning map are:

• The business will most likely have to conduct further research to come up with effective strategies.

• Just because researchers have identified a market gap does not mean the product will be successful.

• The scale or dimensions that the marketers used might not be the most effective one for the market or industry they are trying to examine.

Positioning Map vs Perceptual Map

Positioning maps and perceptual maps are two valuable tools used in marketing and strategic planning to understand the competitive landscape and identify opportunities for differentiation. While both maps serve similar purposes, they have distinct focuses and rely on different data types. Let's compare the two in a table to understand their differences and applications better.

In summary, a positioning map focuses on objectively comparing products or services based on specific attributes or factors. In contrast, a perceptual map emphasizes consumers' subjective perceptions regarding the positions of products or brands along key attributes important to the target audience. Both tools can be used together to understand the competitive landscape comprehensively, allowing businesses to make informed decisions about product positioning and differentiation strategies.