Understanding the competitive landscape is crucial when you’re planning to launch a new product, increase market share, or grow into a new market. Market assessment frameworks scaffold this research and your evaluation of the competition.
What is a market assessment framework?
Using market assessment frameworks means you avoid a scattergun approach to market opportunity assessment and removes any guesswork or assumptions about your position. Instead, you create successful growth strategies built on data-based insights.
A range of different market assessment frameworks are available, each giving you a different angle on your competitive landscape, market dynamics and target audiences. The common factor linking them all is that they present a mass of complex information in a clear visual, with easily understood, shareable metrics.
At the outset, you need to figure out the right combination of market assessment frameworks that will give your business the most valuable insights.
What are the benefits of a market assessment framework?
Overview
Santiago Sanchez, DoorDash General Manager, worked with NewtonX using our Hypergrowth Strategy Framework to build research insights into their decision making process. He explains the broad benefits and their considerable impact: “With quickly changing competitive landscapes, we need to grow in a more disciplined way. We’re no longer a scrappy startup; we’re a publicly traded company. Research enables a much tighter focus to our strategy conversations, which ultimately gives us greater advantage. Because when we go too fast – we miss things if we don’t dig into research and surface new insights. Research helps us increase the upside by helping uncover new growth ops and minimizes the risk by providing the ‘right’ certainty in our decisions.”
Specifics
There are several benefits to using the right mix of market assessment frameworks, from immediate practicalities to developing a 360 vision of your organization’s position.
Get clarity
Each market assessment framework visually represents a distillation of your insights. This gives clarity of meaning to everyone you share it with across your company.
Learn from others’ mistakes
You’ll be able to see where competitors have made mistakes and avoid wasting money on the same thing.
Learn from others’ successes
The right kind of market opportunity analysis reveals where your competitors’ have had rip-roaring marketing successes. You’ve got the evidence to support any changes to your marketing strategy that uses this information to your advantage.
Discover treasure
By deep diving into your competitors, you’ll discover pieces missing from your business strategy – which become the springboard for your next new concept.
Refocus your understanding of the market
Using market frameworks help you see market shifts that were previously veiled by the sheer volume of disorganized data. This maximizes your ability to take opportunities and mitigate threats.
Get your sums right
The competitive intelligence insights gathered using market assessment frameworks helps you calculate the costs of entering a new market, the expected investment return, and the state of the market itself. This answers questions like, ‘Is the market saturated?’ or, ‘Is there room for growth?’ with reliable data.
Perfect product market fit
By deep-diving into your audience segments and getting to the heart of their needs, pain points and aspirations, you can fine tune your USP to create the best offering on the market.
Types of market assessment frameworks
You need to start by carefully choosing the right combination of market assessment frameworks to give you a holistic overview of your competitive landscape. Below is a quick definition of the most commonly used market assessments and their individual ‘star quality’ – the key insight you’ll be empowered with.
SWOT analysis
SWOT analysis has become embedded in people’s thinking that it’s easy to forget you ever learned its definition as a framework.
Its visual representation is a square divided into four sections. Each quadrant has its own label: Strengths, Weaknesses, Opportunities and Threats – thus, the acronym. A SWOT analysis is a useful scaffold to thinking through any number of decisions. In this specific instance, considering the competitive landscape, the specifics would look something like:
- Strengths: What benefits are there inside an organization?
- Weaknesses: What disadvantages exist within a company?
- Opportunities: What opportunities are there outside the organization?
- Threats: What are the external threats that create challenges?
Star quality
Not only can you use a SWOT analysis to evaluate your own company, but also to assess these elements in your main competitors. These insights are particularly useful in highlighting your comparative advantages.
Porter five forces model
Michael Porter, a Harvard business school professor, created this framework that scaffolds understanding of the 5 key market forces that influence your industry.
- The competition: How many competitors do you have? Is their offering the same as yours? How much power does that leave you with?
- Beware the newbies: Any new entrants into a market pose a significant threat to your existing position. How well fortified is your industry against newcomers?
- Supplier strength: How easy is it for suppliers to raise input costs?
- Client power: What kind of customer base do you have? How much power do they have to negotiate with you?
- Substitution threat: Does anyone else have a similar product or service that can easily be a substitute for yours? The existence of such substitutes poses a direct threat to your power within the market.
Star quality
You can use Porter five forces model to zoom into a specific element and zoom out to get a broad overview of the most relevant industry influences. You can plan long-term profitability into your business strategy by using this framework because this panoramic view of your industry helps you bolster positions of strength, repair weaknesses and navigate your competitive landscape without inadvertently giving way to any competitors.
PESTLE
A PESTLE analysis is a strategic planning tool that organizes the myriad of outside influences on your market into 6 key areas.
- Political: Wherever you operate in the world, government legislation and policy impact how you operate. Political stability, trade agreements and employment laws all impact your ability to do business.
- Economic: Economic factors include exchange rates, recessions, inflation and GDP growth rate.
- Social/Cultural: Social factors include all the many strands of culture and lifestyle that influence your buyer personas.
- Technology: The fast-paced changes in new technology and how it’s used in different industries.
- Legal: Any and all of the laws that affect the running of your business, like Health and Safety, IP regulations, Advertising Standards and Consumer Rights laws
- Environmental: Rules around environmental protection, pollution and carbon footprint targets, and climate change
Star quality
A PESTEL analysis helps you identify external factors that affect your standing and competitive opportunities. As importantly, it also measures the strength of their impact on your organization. So you can spot trends early, swerving risks and making the most of any opportunities.
Strategic group analysis
Strategic group analysis framework groups companies by the similarity of their strategy. The grouping focuses on a few elements from a range of characteristics like: pricing, range of services or products, geographic area, marketing channels, quality, branding. Once you’ve identified your 2 key aspects for a group analysis, this can be turned into a strategic group map. This is a two axis graph, one characteristic on each axis, on which you can plot your competitors – and yourself.
You can analyze your insights to reveal the intensity of competition in your strategic group and between different groups in your industry. This data also starkly highlights any gaps in the market and potential threats.
Star quality
Strategic group analysis illuminates your marketplace with data that directly compares you and your competitors. You can use the details of these insights to develop a strategy that strengthens your position, by taking advantage of any gaps in the market and becoming a more formidable foe to market leaders.
Growth share matrix
A growth share matrix is another quartered grid. This time the focus is on organizing your competitors’ products and services by growth rate and level of market share.
- Stars: These are high growth and high market share products/services – more investment please!
- Question marks: Offerings that are high growth, but low market share – decide if they’re likely to become stars, or to withdraw investment
- Cash cows: Low growth and high market share – the stars thank you for your continued investment
- Pets: Low growth and low market share – let’s reposition, or we’ll have to give up on you
The names of the sections themselves generate helpful mental images to reinforce the meaning of each segment.
Star quality
The market assessment evidence you need to prioritize investment in your services and products. It looks beyond your own organization and takes in the whole market. You can see who’s got what and where you can gain an advantage.
Perceptual Mapping
Get into the minds of your target market and find out what they really think about you and your competition. A perceptual, or positioning, map is a graph that shows a comparison of 2 factors. For example, price on one axis and quality on the other. You can plot your competitive landscape in one visual and easily compare perceptions on your core characteristics.
Star quality
Perceptions can be changed. Once you know how you and your competitors are perceived, you can adapt your strategy to strengthen your position accordingly. Perceptual mapping makes data insights easy to understand, making your strategy discussions more efficient.
Business model canvas
A business model canvas is an analysis that has 9 elements. You can use this framework to illustrate the fundamentals of your business and your competitors’ organizations. This isn’t a dossier of information, but a one-page document that only contains the key answers in each of its 9 sections.
- Customers: Who are you selling to? Who are your main buyer personas?
- Value proposition: Why do people choose you?
- Channels: Where are your customers? How do you connect with them?
- Customer relationships: What is each client’s customer journey like? Where do they meet you and how do they feel?
- Revenue streams: Show me the money! How do you make money?
- Activities: How do you deliver your best to the client?
- Key resources: What do you need to deliver your promise?
- Partners: What strategic partners do you have/need to have to maximize the customers’ experience?
- Cost: How much does it all cost and how does that interconnect with revenue?
Star quality
You get a clear picture of all these foundational elements on one page – for your business and your main competitors’. This helps you focus on the most important factors that position you ahead of the competition.
Customer journey map
How does each buyer persona experience your – and your competitors’ – brand? A customer journey map, or user journey map, gives you a visual representation of their experiences.
This isn’t about what you think they experience, but is based on data from your clients and prospects. It’s absolutely crucial that you really see things through their eyes. You need to include all the places buyers can meet you, from your website to social media, chatbots to in-person meetings. Now stand alongside one of your buyer personas and navigate the experience with them. Where are the bumps in the road? Are there any missing signposts? Spot everywhere they get great customer service. Do this with every member of your buyer team.
Now it’s time to go to a different world and experience the customer journeys your competitors have built. How are their user journey maps different? What can you learn from this?
Star quality
You can see how customers feel along their path to purchase and identify their pain points. You can use these insights to develop improvements to your own customer journey and exploit the potholes in your competitions’.
Conduct market assessment and analysis with a research partner
You can work together with an expert research partner to create the best research strategy for you. It ensures you get all the actionable insights you need by constructing the right combination of methodologies and frameworks. After an initial snapshot of your competitive landscape, you can embed market assessment analysis into your overall research strategy to continually monitor the dynamic competitive landscape.
Identifying the most valuable star qualities delivers all the insights you need to guide your long-term strategic thinking.
Looking for a research partner? Get a quote today.
