Competitive Landscape

What is a competitive landscape?

A competitive landscape is the analysis of an industry’s structure and dynamics to highlight a company’s market positioning. Competitive landscape analysis helps organizations understand competitors’ advantages and identify gaps in the market. 

When creating a competitive landscape, organizations look at other brands’ offerings, pricing, brand values, and market share. Then, they analyze their own strengths and weaknesses against other companies to see how they stack up. This helps companies determine and prevent potential threats from rivals.

Marketing, sales, and product teams use competitive intelligence tools to create and evaluate their competitive landscape. This software provides insights into competitors’ digital footprints, including pricing, news, positioning, content marketing strategy, and reviews. 

Types of competitive landscapes

A competitive landscape analysis provides valuable insights into a company’s competitors to help them position themselves successfully. Various types of competitive landscapes exist, including: 

• A growth share matrix splits products into a four-quadrant matrix based on profitability. For example, one category, nicknamed “cash cows,” are products with low growth and high market share. Another, called “pets,” have low growth and low market share. This approach clarifies which products the company should invest in and which they should cut.
• A strategic group analysis segments competitors based on their strategies. This lets a company see how its strategy compares to others and spot opportunities. 
• Porter’s Five Forces, developed by author and economist Michael E. Porter, splits an industry into five competitive forces: new brands entering the market, rivalries between existing companies, buyers’ bargaining power, suppliers’ bargaining power, and the threat of substitutes, such as alternative products or services. Breaking an industry down this way gives a company an understanding of its place and the potential for profitability.
• A SWOT analysis assesses competitors' strengths, weaknesses, opportunities, and threats. Then, the company conducts a similar self-analysis to see how it compares. This helps the company understand its capabilities and where it stands in the market.
• A perceptual mapping analysis is a framework that visually shows how a brand or product stacks up against its competitors. A company collects customer data about their perception of brands and products via surveys or interviews. Then, they chart the results on a graph, each axis being a different component, like quality, accessibility, or price. Those perceived by the public as similar appear closer together on the grid.

Benefits of competitive landscapes

All types of competitive landscapes help companies understand themselves and their competitors better. Some specific advantages include: 

• Determining a unique differentiator. Conducting a competitive landscape analysis lets a company explore its unique selling proposition (USP), a competitive edge that sets it apart. Leaning into this differentiator enables a company to position itself as a go-to in the market with a remarkable quality that others can’t provide.
• Identifying market trends. A competitive landscape helps organizations identify and avoid changes in business strategies and consumer preferences. For example, a company might notice competitors adding luxury product lines or consumer preferences for specific product colors. This lets them get ahead of the trends.
• Spotting gaps. With a competitive landscape, an organization may find that competitors don’t have offers for a particular segment of customers, like those in a specific geographic location or who want mid-range appliances. Then, the company knows it can fill the gap and make more sales.
• Improve products and services. As part of a competitive landscape, a company often analyzes customer reviews, both their competitors' and their own. This qualitative data highlights what they can do better to make a product more appealing to their customer base. 

Competitive landscape best practices 

A competitive landscape helps drive organizational decision making that boosts sales and revenue. To get the most out of competitive landscape analysis, a company should consider these best practices:

• Research thoroughly. The more comprehensive the research is, the more accurate the competitive landscape becomes. Companies should collect data on competitors’ products, market share, audience preferences, strengths and weaknesses, and pricing. 
• Use multiple data sources. For the most well-rounded results, companies should aggregate data from multiple sources, including quantitative data from analytics software and industry reports and qualitative data like surveys and interviews.
• Find real-world customer feedback. Companies should gather voice-of-customer (VOC) data by looking at reviews on competitors’ websites and third-party sites to see what customers think about the product and customer experience (CX). Social media monitoring tools help glean insights from online forums and social media comments.

Take your research a step further with audience intelligence software, which uses AI and machine learning to analyze social data.