Competitive Position

Definition

Competitive position refers to the position of one business relative to others in the same industry. There are a multitude of factors contributing to (and which can be used to measure) competition.

The major categories are:

  • Market position— relative share of market, rate of change of share, variability of share across segments, perceived differentiation of quality/service/price, breadth of product, and company images
  • Economic and technological position — relative cost position, capacity utilization, technological position, and patented technology, product or process
  • Capabilities — management strength and depth, marketing strength, distribution system, labor relations, relationships with regulators

Competitive analysis is the analysis of factors designed to answer the question: How well is a firm doing compared to its competition? The analysis goes well beyond sales and profit figures in assessing the firm’s ratings on such factors as price, product, technical capabilities, quality, customer service, delivery, and other important factors compared to each of the major competitors.

competitive advantage exists when there is a match between the distinctive competencies of a firm and the factors critical for success within the industry that permit the firm to outperform its competitors. Advantages can be gained by having the lowest delivered costs, or by differentiation in terms of providing superior or unique performance on attributes that are important to customers.

Competitive intelligence is the systematic gathering of data and information about all aspects of competitors’ marketing and business activities for the purposes of formulating plans and strategies and making decisions.

Competitive strategy is a plan that attempts to define a position for the business that utilizes the competitive advantages that the business has over its competitors.

See Also

Competition
Competitive brands

References

  1. American Marketing Association, AMA Dictionary. (May 2015)

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