What Is Market Mapping? A Level Business Guide

Market mapping is a way of showing how customers perceive competing products or brands. A business plots them on a diagram using two characteristics, such as price and perceived quality. The diagram is also called a positioning map.

How does it work?

Each axis represents one characteristic. For example, a business could put low to high price on the horizontal axis and low to high perceived quality on the vertical axis. It then places its own product and competitors' products where customers are likely to see them.

Imagine three cafés. Customers see one as low-priced with basic quality, another as expensive with high quality, and a third as mid-priced with high quality. Plotting them makes it easier to see which cafés compete most closely and how each one is positioned. The mid-priced, high-quality café might appeal to customers who want quality without paying the highest price. But the positions reflect what customers think, not necessarily an objective measure of quality. Different customer groups may place the same café in different positions.

Why use a market map?

A map can help a business identify competitors, decide how to differentiate its product, or consider repositioning it. Differentiation means giving customers a reason to see a product as distinct from alternatives. Repositioning means changing how customers perceive an existing product, perhaps through its price, features or promotion.

The most important exam mistake is to assume that an empty space on the map proves there is an opportunity. It may be a gap in the market, but there might be too few customers who want a product there, or it might be too costly to provide. A business needs market research before deciding whether the gap is worth targeting. A map is also only as useful as the customer perceptions and characteristics used to create it.