We have discussed the importance of identifying where we stand in relation to our competition. It can be helpful to choose a variety of factors and rate where we stack up against the competition; however, I have found that it can be advantageous to take an even more targeted approach through the use of a competitive positioning map.
In order to successfully implement this method, you will need to choose the 2 most important factors for your product or service that will enable you to differentiate yourself from the competition. For example, let's choose the two factors price and quality. If you decide that you can maximize economic profit through a premium pricing strategy, then you should seek to be in the top right quadrant of the grid (highest quality and highest price).
After selecting where you need to be on the map (check mark) and where the competition currently stands (red x's) then you need to be 100% dedicated to establishing that competitive position. Differentiation is often a critical successes factor and it is imperative to know where you stand and where you are headed. This approach is intuitively simple to understand and has a high visual impact when explained to others.
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