Competitors' products operating on the market. Competitiveness of the enterprise in the market. Competition calculation methods

The competitive struggle itself makes it possible to identify from many organizations indispensable leaders capable of producing truly high-quality and relevant goods and services for modern life that will be in demand by the population. The negative aspects include: it gives business a certain instability, creates conditions for unemployment, inflation and bankruptcy...

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Competition– a natural phenomenon in any business in market conditions. To succeed in a competitive environment, you need to learn how to position your product or service in the market and sell it to potential customers.

An entrepreneur's ability to identify competitors, determine their strengths and weaknesses, and produce and sell a product or service in an open market environment is a key skill in the marketplace.

An effective competitive strategy requires the entrepreneur to be smart, reasonable, creative, and flexible. All of these skills can be acquired with practice.

Competition in economics can be compared to competition in sports, and the qualities required by an entrepreneur to succeed are comparable to those required by an athlete in competitive sports. Both the entrepreneur and the athlete must be in constant search to be faster, higher and stronger than the competition.

You should remember that your competitors are looking for ways to put you out of business as quickly as possible, so you must constantly look for ways to grow your business and maintain a leading position in the market.

Customers want the best at the lowest price, so they will shop with the company they believe offers the largest range of products and the greatest benefits.

To succeed in any business you need develop and maintain a competitive advantage in the market. Determine what is the superiority of your product or service compared to competitors' products on the market, what competitive advantages of the product you will develop and maintain, and be absolutely confident in yours.

Entrepreneurship is an endless battle with other companies for the favor (and ultimately the wallet) of customers. To succeed in this fight, you must be determined to become the best in your market. Set a goal to become number 1 or number 2 in your niche and constantly strive for excellence in your product or service.

The overall strategy of your business is determined by the list of companies and products that you want to compete with. But your competitor is not the one who offers the client the same thing as you (an identical product or service, the same). Your competitor is any alternative use for the amount of money your product costs. Your competitor is the client’s lack of awareness about the presence of your product or service on the market.

It must be remembered that the client always has a choice:

• buy goods from you;
• buy a product from one of your competitors;
• do not buy goods from you or your competitors and spend the money on other purposes.

To conduct a competitive analysis in the market, make a list of all competitors that could take your business or customers away from you and answer the questions:

• Why do your customers buy products from your competitors?
• What benefits and benefits does your customer receive when purchasing products from competitors?
• By what criteria are your competitors' products and services superior to yours?
• What are the strengths of each competitor?
• What are the main weaknesses of each competitor?

Carefully select the competitor from whom you plan to take business and sales and answer the questions:

• What do you need to do to get customers to switch from your competitor to you?
• What must your client be convinced of in order for him to buy a product from you and not from your competitor?
• Why should your customer switch from your competitor to you?
• What value does your product have for your customer that your competitor’s product does not?
• What are your competitor's greatest vulnerabilities?

To compete in any new market, your product or service must be superior to your competitors' products or services in at least three of the following ways:

• Your product should be cheaper, but have the same or higher consumer properties;
• Your product should have higher consumer properties, but be sold at the same or lower price;
• Your product should offer features and benefits that your competitors do not have;
• Your product should be more accessible and easier to buy;
• You must provide delivery and service (warranty and post-warranty) of the highest quality.

You must be absolutely sure of the competitive advantages you need to develop in order to be successful when entering a new market. It is very difficult to get a client to buy a product not from your competitor, but from you. The power of habit plays a key role in this case.

• Calculate the costs of product development and entering a new market.
• Determine how long it will take you to achieve successful sales.
• Consider entering a different, less competitive market.

Your goal is ultimately to develop your product or service to outperform the competition.

• If your product or service were the best on the market, what would your customers say about it?
• What should you include in your product or service to make people say that you are the best on the market?

When selling in a competitive environment, you can always lower your selling price, offer something different, or change your market.

You must constantly look for weaknesses (vulnerabilities) in competitors' products or services and develop strengths in your products.

Your ability to sell effectively in a competitive market is the key to your success as an entrepreneur.

“Tell me and report the whole truth: Am I the sweetest in the world?” - in the modern world, few businesses doubt their ideality.

By default, most people believe that competition is for weaklings, or as women say: “Are you jealous?!” It means I’m not confident in myself.”

But seriously, competitor analysis covers all the most important things, because after all, we are fighting for the same clients. Therefore, you need to know everything about the activity of competitors in order to do better.

Know by sight

You have already come to terms with the idea that analyzing competition in the market is good. Now the next step is to find those very “enemies of the people.”

And as practice shows, many companies set their accents incorrectly, and as a result enter into a race with companies that will never stand next to them.

In order to truly understand who your competitor is, you need to start with a definition.

You need to find people with potential for you. Then you determine which companies these customers choose between.

And only then will you truly see which companies are fighting for the same clients as you. These will be your key competitors.

I would like to draw your attention to the fact that if you are not a federal company of the M-Video or Ozon level (our blog is rarely read), then you should NOT set yourself to defeat all-Russian monsters.

I don’t want to offend you, but most likely your entire advertising budget (like ours) for federal companies is a miscalculation.

You need to be smarter and target your client, and not try to fight with them for the same market.

In addition to key competitors, you have direct and indirect ones. For you, direct ones are just federal networks and other companies for which you are too tough.

Indirect - those companies that may, by coincidence of circumstances in the world, become your direct competitors, or those businesses.

Those who compete for one of your client’s budgets, but at the same time work in a different area (for example, you are a restaurant, and your indirect competitor is a cinema).

Important. The frequency of analysis is determined based on market dynamics. The more and more often changes occur in your field, the more often you will have to evaluate the situation of competing businesses.

Systems approach

“I know everything about them” is the most common phrase we hear when collecting information about competitors in or.

In this case, we have dozens of questions that will solve the client like bullets, and show that he is not immortal and his excessive self-confidence only harms him.

Competitor benchmarking is not a game of “I know - I don’t know.” This is a systematic approach consisting of techniques, tools and a huge number of tables and graphs.

Therefore, we throw the school approach into the corner and talk about analysis like adults. And to do this, we need to separate the two concepts that we will use in the process.

1. The subject of study is part of the business being analyzed.
2. Study method is an approach to analyzing a part of a business.

To put it roughly, you must separate the concepts among yourself - “What are we analyzing?” and “How do we analyze (competitor evaluation criteria)?”

To complete the picture, we will consider both. Therefore, get ready for a huge number of boring-interesting (yes, yes) words and sentences. And we will start with the subject of analysis, since the method is formed on the basis of it.

Subject of study

Depending on the goal of analyzing the competitive environment, you will have different assessment zones.

It is quite possible that literally one subject of study from the entire list will be useful to you, but for sure, if you study more, it will not be superfluous. Of course, no one will pat you on the head, but you will have more money.

How touching

1. Basic information

At the beginning of the analysis, everything is like in the army: “Weight, height, year of birth?” We study introductory information to form a general understanding of the players on the battlefield.

Most likely, you already know all the information if you have been working for more than a year, but we recommend removing these thoughts, since the world is changing, just as competitors are changing.

The more intense the competition, the more background information you must collect, since every detail can become a path to differentiation.

To make it easier for you to understand what I'm talking about now, check out the list of recommended basic information to collect:

1. Year of foundation;
2. Region;
3. Management;
4. Number;
5. Market share;
6. Working money;
7. Key clients;

I would like to draw your attention to companies as a separate point. When analyzing, we need to look beyond the “now.”

Of course, it’s more important for everyone to get money right now. But we must not forget that business is not a sprint race, it is a marathon, where the winner is determined after a long journey.

And if you don’t foresee this, then maybe everything will be fine for you now, but in a few years it will go down the drain.

2. Product matrix

The first thing you need to start studying is the company's product, since everything grows from it. Not marketing, not sales, but the product.

People go for services and goods, and only then go to the company. Having studied their proposal, we will be able to understand how competitive the foundation of your company is.

2.1. Product

You must study the product from all sides, paying attention even to details. This will help you find yours not only on a global level, but also in the smallest details.

If you make a basic list of areas that you should pay attention to, it will look like this:

1. Range;
2. Size;
3. Appearance;
4. Package;
5. Characteristics;
6. Warranty support;
7. Color;
8. Implementation format;
9. Term;
10. Degree of fame.

Moreover, it is necessary to evaluate not only the main category of products, but the entire one.

You need to understand what are the main products, upsells, premium products and so on.

You study everything you can get your hands on. After all, if you have spent time at your place, then you know that there are situations when the main profit is made by products from which you do not expect it.

To make the analysis of competitors' products and services more effective, it is recommended to format this whole thing in a table or graph.

But again, everything is at your discretion, because how it will be framed in the end does not matter. You do everything for yourself, and not for your thesis (remember the institute, right?).

WE ARE ALREADY MORE THAN 29,000 people.
TURN ON

2.2. Pricing

Each product has its own cost. Of course, it consists not only of cost, as is commonly believed.

The larger the company, the more other expenses are included, including overpayment for the brand. Therefore, first of all, you need to find out what is included in their cost and what is the profit.

Then you need to go to the client’s side and evaluate the very fact of the final cost, because the cost is not important for the consumer, he sees the final value and already determines from it - yes or no.

Most likely, you analyze competitors’ output prices quite often, since for many this is an analysis of competition in the market.

If you can’t fight with cost, try to surpass them with other differences, or use one of the strategies described in our article

3. Marketing

Marketing is a huge topic to analyze. You definitely won’t study it 100%. This is due to the fact that you never know exactly where the competitor’s budget is currently directed.

However, marketing is the front door of a business, and whether the client will come to you or to them depends on how well it is packaged and formed.

3.1. Basic Marketing

The first marketing analysis of competitors should begin with examining the fundamentals of their approach.

You need to understand how they present themselves and “what they breathe.” In other words, you analyze.

Even if it doesn’t exist at first glance, you still need to understand at least where they are going. After all, we must remember that analysis provides not only a tactical, but also a strategic vision.

These are the 5 aspects that we pay attention to first after competitors' strategies.

There is no point in continuing on the remaining points, since the topic is obvious and does not require disclosure.

But if I’m wrong, then you can write a comment under this article and we will help you in identifying basic marketing issues for your competitors.

And all this is completely free, because we don’t charge money for small tips. This is our investment in you for the future.

Cool!

3.2. Attracting clients

We had a client whose competitor was stealing customers right from under his nose.

He did not surpass it in budget, he bypassed it in mind. Namely, he was always one step above our client.

Need marketing analysis?

Order it from us

Strategy
promotion

Differences from
competitors

Types of clients and their
election criteria

Dynamics and
market trends

And a huge amount of other information

3.3. Customer retention, monetization and return

The most favorite part of business for all entrepreneurs is attracting clients. In 7 out of 10 cases, during consultations we hear the question: “Where to get new clients?”

It feels like the light has converged on them like a wedge. And this erroneous opinion wanders from year to year.

But in vain, you can increase the company’s capitalization without attracting clients. To do this, you just need to work correctly with your customer base.

And most likely your competitors do not miss this opportunity and use everything to the fullest.

Therefore, you need to study all possible additional actions in the field of marketing of your colleagues in the shop. As usual, I provide you with a basic list of zones for analysis:

1. SMS sending;
2. Additional gifts.

This point should be the most voluminous, since it includes all marketing activities that are aimed at customers.

And since marketing includes more than 5,000 tools among them, I admit that you won’t be able to find everything.

However, you need to go through all the basics and isolate what is good about their marketing.

4. Sales

Marketing is just a tool to attract customers and increase their desire to buy. Everything else in classic business is done by people and sales tools.

Therefore, you need to know everything about sales in a competitor’s company. Moreover, like marketing, this part is roughly divided into several parts.

4.1 People

It is very bad for business when customers deal with people rather than with the company. But from the point of view of analysis, you need to approach it from this side.

To really see what it is about employees that makes consumers work with them, and not just with us. Here the list of analyzed points may be as follows:

1. Positions;
2. Regalia;
3. Personal qualities;
4. Appearance;
5. Communication style;
6. Education.

You need to learn everything about their team. It is quite possible that their entire business rests on people.

For example, because they employ specialists with very famous names. For you, this means that if you do not strengthen yourself with equally famous people, you will have to sweat in the struggle for a place in the sun.

4.2 Sales tools

In paragraph 3.3, we looked at tools that also help sell to employees.

But here we will talk about something else. In marketing, these are tools that directly contact clients, but in this case we are talking about actions and materials that function only within the company and the client does not see them.

In simple language, I will call this a “sales department audit”, in the most classic sense of this phrase.

You learn everything that makes their sales managers as effective and motivated as possible. I recommend starting with the following points:

1. Reports;

Only sales scripts can be evaluated without problems. It is practically impossible to study the rest without a sent Cossack, a Trojan horse or other cunning ways of infiltrating behind enemy lines.

You will simply not be allowed inside the company, and the answer to the question - “Why?” is quite obvious - “Because”.

But if you really want it, you can fly into space and get this information. I proudly say that it has been tested on our clients.

5. Terms and business processes

When you know everything about the product, marketing and sales, then you are literally missing the last piece of the puzzle, these are their terms and business processes.

You will receive part of this information when studying the previous parts of the business, but here you again (or again) need to look at this whole matter from a different perspective.

Study their logistics, study their production, study their ability to provide deferments, installment plans, and products for sale.

You need to study all their working conditions from needle to rope. Granted, some of them are not so important for the client, but if a company does it (especially one that is better than us), then it means it understands why it needs it.

The most obvious way to study conditions and business processes is to go through the entire customer journey from A to Z, from call to purchase, and even better, to return/rejection of the product, if possible.

And you must be the most meticulous client so that you are fully served and you see all parts of the business.

This way you can understand how to improve your working conditions. For example, you will introduce faster delivery than theirs, or introduce interest-free installments for 24 months, when everyone has 12.

You can also improve your business processes to differentiate yourself from them (this is one way to differentiate), or increase efficiency, or reduce costs.

Study method

In the modern world, there are dozens of methods to conduct competitive market analysis.

There are even those that last several months. We will study the simplest, and at the same time the most effective, methods of competitor analysis for ordinary classic business.

Leave complex and voluminous processes to us, because we also need to learn this. It is very difficult to do this in one article, and without a mentor.

Bad news. Within the framework of this article, we will not be able to consider in detail all methods of analyzing the competitor market, since each of them will take more than one thousand words.

Therefore, we will analyze the concept, and if you are interested in one of them, then read more in other articles.

1. Comparative analysis

The simplest and largest (in terms of page volume) way of analyzing the competitive environment.

You define evaluation criteria (and based on the text above, you realized that there are hundreds of them) and use them to compare yourself with each competitor in the form of a table or graph.

You can rate according to the principle “Yes/No”, “Yes/No” or in a numerical value from 1 to 10. I prefer the second option, as it is more transparent.

Comparative analysis

The main disadvantage of this method is that some business aspects cannot be objectively assessed using categorical or numerical criteria.

Also, you can only evaluate the present situation at the moment, and not see what can happen next, what threats and risks there may be. And you also need to know this, since you obviously plan to work for more than one year.

Comparative analysis of companies

Comparative competitive analysis can be carried out both within the entire company and within a specific tool in order to obtain the most reliable information.

But this will take several times more time, perhaps even tens of times, so set your priorities correctly.

Comparative analysis of tools

2. SWOT analysis

The most popular method of analyzing the market and main competitors. A classic of the genre among analyzes that is still taught in institutes.

Its meaning is that you compare yourself with a certain competitor in 4 parts: strengths, weaknesses, threats and opportunities.

These four parts are divided into external and internal. This method already sees a bigger picture for the future.

I like this approach, but it also has drawbacks, since there is no digital assessment, and what matters is that we rely on our subjective opinion or the conclusions of independent experts, who can also be wrong.

As a result of a questionable Yes/No assessment, you may focus on the wrong things and waste time searching for non-existent treasures and eliminating ghost pirates.

SWOT analysis

3. SNW analysis

Some say that SNW is an improved SWOT analysis. But in fact, this is a different model that focuses on analyzing the internal environment of the company.

That is, if a SWOT analysis analyzes the strengths and weaknesses (2 of 4 parts), then in the case of SNW you also study the neutral aspects of the company.

In practice, this helps you find your competitor’s points in a normal (neutral) state.

For you, this means that you can make them your competitive advantage if he does not pay attention to them.

SNW analysis

This analysis is less suitable for small businesses, since its focus is on strategic comparison.

Therefore, if you are not particularly focused on the topic of strategy right now, then it is better to return to SWOT or comparative analysis.

In addition, SNW analysis makes a rating based on the principle of good/normal/bad, which is also not an accurate measurement of tactics.

Briefly about the main thing

In marketing consulting, we always start our work by analyzing the strengths and weaknesses of competitors.

This usually results in us getting a lot of flak from property owners because they don't see the need for it and feel like we're wasting their money.

And you will be surprised (or maybe not), but there will be no good ending to this story. After the analysis, no one says “thank you” to us and they still consider it a waste of resources.

There is a phrase: “You should have fought evil, not joined it.” We are precisely those who go against the grain.

Let us lose clients because they allegedly did not see results in the first month of work.

But we will still conduct an analysis of competitors and the company at the beginning of work, hoping to find true connoisseurs of a smart approach, where every step is taken not because it is “cool”, but because it is justified.

And without analysis this cannot be achieved. You will forgive me, but most of you will not do the analysis wisely.

You will have a thousand excuses to do this later. As my friend says, “I’m not getting paid for this argument, so let it be your way.”

Therefore, I will not convince you, but in order to somehow smooth out the situation, I have prepared for you a list of minimal actions to move consciously at least at arm's length.

1. Which one?
2. What acquisition channels are used?
3. By what criteria is their product better than yours?
4. What is the pricing and discounts for the product?
5. How well do managers sell in person?

Marketing research of competition and competitors is an important component of a comprehensive study of the market in which the enterprise operates. Accurate knowledge of the strengths and weaknesses of a competitor makes it possible to better justify the strategic directions of development of your company and strengthen its position in the market.

Marketing research refers to the systematic collection, display and analysis of data on various aspects of marketing activities. Marketing research is a function that, through information, connects marketers with markets, consumers, competitors, and all elements of the external environment of a food establishment.

The marketing research process includes several stages, which are presented in Figure 1.

Figure 1 - Marketing research process.

As for competition in the market, it is an effective coordinator of economic activity, and government support is required to maintain it at the proper level. However, government intervention often harms competition.

In general, competition is an element of the market mechanism, the struggle for the most favorable conditions for the investment of capital, and in market conditions it represents the main mechanism for the formation of economic proportions.

The market participant should be aware of the following most important areas of competition:

Quality competition - increasing the consumer properties of a product while maintaining the same price, or significantly higher quality of a product with a slight increase in price;

Functional competition - competition with fundamentally different products that can satisfy the same needs as your product;

Price competition is the struggle for the buyer due to a lower price than that of goods of the same quality from other companies.

Of course, many phenomena of competitive struggle appear not in pure form, but in combined form. It is not always possible to draw a clear line between different factors that have an active effect on the market. For analysis, the competitive environment is divided into five components that affect the level of competition (Porter’s model) - shown in Figure 2.

Figure 2 – Model of competitive forces in society

The first group includes enterprises that are direct competitors in the industry. To strengthen their positions compared to competitors, enterprises use a variety of techniques and competitive tools.

The magnitude of the second component (the emergence of new competitors) is influenced by: efficient scale of production, consumer preferences, access to distribution channels, know-how in the field of production, low production costs, government regulation.

The threat of substitute goods is the more real, the greater the number of effective substitutes for the produced goods, the volume of production of substitute goods, the difference in prices between the original product and the substitute product in favor of the latter.

The ability of suppliers to bargain is possible in cases where: the group of suppliers is small and more concentrated than the enterprises in the industry; there are no substitute products; the supplier's product is of great importance to the enterprise; a group of suppliers poses a real threat to forward integration, that is, it is ready to create its own structure for purchasing its products and replace the enterprise with it.

An increase in the “bargaining power of buyers” is possible when: the group of buyers is small, concentrated, or the buyer accounts for a significant share of the enterprise’s sales; the costs of switching to the products of another supplier are low; the buyer's income is low; the quality of the industry's products does not affect the quality of the buyer's product (for example, packaging), the buyer has complete information about the industry and products.

With all the variety of methods and means of competition, three main strategic approaches to competition can be distinguished:

Striving to have the lowest production costs in the industry (cost leadership strategy);

Finding ways to differentiate competitors' products (differentiation strategy);

Focusing on a narrow part rather than the entire market (focus or niche strategy).

Another important issue is studying competitors. The process of studying competitors can be divided into 4 stages:

Identification of current and potential competitors;

Analysis of competitors' activities;

Identifying the strengths and weaknesses of competitors;

Determining the position of the enterprise relative to competitors.

First stage. Identification of current and potential competitors. It is carried out on the basis of two approaches: the first is associated with an assessment of the needs that are satisfied in the market by the main competitors, and the second is with an assessment of the marketing strategy used by competitors.

In the first approach, the following groups of competitors are distinguished:

Enterprises offering a similar type of product to the market (current competitors);

Enterprises serving other markets with similar products, but entry into this market is likely (potential competitors);

Enterprises that produce substitute goods that can displace a given product on the market.

In the second approach, groups of competitors are identified:

Applying a market expansion strategy (increasing market share by attracting an increasing number of consumers based on communication policy);

Focused on pricing policy (lower price level);

Focused on product policy (best quality, service, wide range).

As a rule, competitors use one approach. However, large companies can afford mobility in strategic orientations. These are those forms that are prone to market expansion, as well as suppliers of materials, raw materials, and equipment.

Second phase. Analysis of competitors' activities. Carried out in the following areas of activity:

Financial condition;

Production strategy;

Organization and management of the enterprise;

Marketing activities;

Staffing;

Foreign economic activity.

Third stage. Identifying the strengths and weaknesses of competitors. To implement this stage, you can use SWOT analysis, 4P analysis or drawing up functional maps. These methods will be discussed in more detail in the chapter “Methods for studying competitors.”

Fourth stage. Determining the position of the enterprise relative to competitors. Based on the results of the previous stage, one of the following positions of the enterprise is determined:

The leading position of the enterprise relative to competitors. In this case, the company boldly enters the selected target segments and is confident in its position;

Fast growing position. This is when an enterprise has enough financial resources, but in certain indicators it is inferior to its competitor. In the near future, it does not pretend to be a leader, but will gradually achieve success in the selected target segments;

Copycats. This is when an enterprise has a small market share, does not have sufficient resources and is forced to copy the successful actions of competitors in the market;

Weak position of the enterprise. This is when a company lacks the financial resources to compete. Then there may be a recommendation - to abandon the selected target segments and search for other markets with less stringent requirements.

After positioning the enterprise, a marketing program is developed for each target segment, taking into account its requirements.

When developing marketing programs, the following important aspects should be kept in mind: modifying products in accordance with customer needs, improving design, assigning brands, positioning, developing pricing policies, distribution and promotion policies.

One of the methods for studying competitors is the 4P concept. It is a comparative analysis of your enterprise and competing enterprises according to the following factors (product, price, market promotion, region and sales channels “4P” - the names of these factors in capital letters in English).

The data necessary to assess the competitiveness of an enterprise is best systematized in the form of a table so that you can clearly determine the strengths and weaknesses of your company and your competitors based on the main factors. First of all, you need to identify the main competitors (usually 2-4 companies) in each of your chosen market segments and begin collecting information about them. Each of these parameters needs to be quantified. This can be done using an expert method, for example, ranking all the parameters for each enterprise on a scale from 1 to 5 points. If the “style” line is rated 1 for competitor A, this means that the style of the product is its weak point. If, on the contrary, the score is 5 points, then this parameter is its strongest point.

Further, the scores can be summed up for individual factors (each of the “4Ps”) or for all factors as a whole to establish the level of competitiveness of each enterprise. If there is not yet sufficient information on any of the parameters, it is better to exclude it from the analysis.

In the process of analysis, it is very important to provide a detailed semantic explanation or justification for why a given variable is assigned a given rating. Only in this case, the overall result of the assessment sheet (sum of points) will show the true position of the enterprise in relation to the main competitors in the market. Summing up individual factors and comparing this data with the overall table total allows enterprise management to find out which parameters need to be improved by improving competitiveness. This concept is presented in Figure 3.

Figure 3 – Concept of competitor analysis by 4P factors

Criteria and signs of market segmentation. The basis of the entire planning system in market conditions is sales forecasting. Therefore, the first task of the company's management is to determine the sales volume in accordance with demand, and only on the basis of an assessment of the sales market can one begin to plan the production and financial activities of the company.

Market assessment - a set of measures aimed at studying the trade and marketing activities of an enterprise, and studying all the factors influencing the process of production and promotion of goods from manufacturer to consumer. Each enterprise realizes that its products cannot be liked by all customers at once, therefore, with the help of marketing, the management of the enterprise, based on information about potential consumers, regions in which there is demand, prices that consumers are willing to pay for the product, distribution channels, and competition, determines sales market segment.

Market segment - this is a part of it, defined in a special way, which can be effectively serviced by the enterprise.

The objects of sales market segmentation are:

Consumer groups;

Groups of products (goods, services);

Enterprises (competitors).

Market segmentation by consumer groups - this is a grouping of consumers according to some characteristics that, to one degree or another, determine the motives for their behavior in the market.

Market segmentation by product groups - this is a derivative of market segmentation by consumer groups, takes into account the needs and preferences of consumers regarding the quality characteristics of the product (goods, services).

Segmentation by enterprises (competitors) - this is a grouping of competitors according to competitiveness factors in promoting to the market.

Market segmentation is carried out according to criteria and characteristics.

Criterion - a method for assessing the choice of a particular market segment for products or an enterprise (competitor).

Sign - This is a way to highlight this segment in the market.

The most common segmentation criteria are:

Segment capacity, which will determine the number of potential consumers and, accordingly, the required production capacity;

Channels for distribution and sales of products, allowing to resolve issues regarding the formation of a sales network;

Market stability, allowing you to make a choice about the advisability of loading the enterprise’s capacity;

Profitability, showing the level of profitability of an enterprise in a given market segment;

Compatibility of a market segment with the market of its main competitors, allowing one to assess the strength or weakness of competitors and make a decision on the feasibility and willingness to make additional costs when targeting such a segment;

Assessing the work experience of specific enterprise personnel (engineering, production or sales) in the selected market segment and taking appropriate measures;

Protection of the selected segment from competition.

The main features of market segmentation by consumer groups are geographical, demographic, psychographic, and behavioral. A market segment by consumer group is determined by the coincidence of several characteristics among certain consumer groups.

The main features of market segmentation by product groups are functional and technical parameters, price, etc.

The main signs of market segmentation by enterprise (competitor) are the quality indicators of the product (PT), price, sales channels, and promotion of the product on the market.

Market segmentation by consumers, segmentation by products and competitors complement each other and all the results obtained are considered in a comprehensive manner, which allows you to correctly select the most effective market segment.

Market segmentation by consumer groups

Market segmentation by consumer groups is carried out in accordance with the factors (signs) given in table. 1

Table 1

Main factors of market segmentation by consumer groups

Factors (variables)	Most common variable values
Geographical
Region	The Far North region, the Central Black Earth region, the North Caucasus, the Urals, Siberia, the Far East, etc.
Administrative division	Republic, Territory, Region, District, city.
Population (for cities)	5-20 thousand people, 20-100 thousand people, 100-250 thousand people, 250-500 thousand people, 500-1000 thousand people. 1-4 million people over 4 million people
Population density	City, suburb, countryside
Climate	Temperate continental, continental, subtropical, etc.
Demographic
Age	Up to 3 years, 3-6 years, 6-12 years, 13-19 years, 20-34 years, 35-49 years, 50-65 years, 65 years and more.
Floor	Male, female
Family size	1-2 people, 3-4 people, 5 or more
Family life cycle stage	Youth - single, youth - family without children, youth - family with children, family with children, elderly with children, elderly - family without children, elderly - single...
Income level	Up to the minimum wage; minimum wage; from 2 to 5 times the minimum wage, etc.
Occupation	Scientists, engineers and technical workers, office workers, businessmen, workers of state enterprises, farmers, teachers, teachers, students, housewives...
The level of education	Without education, primary education, specialized secondary education, higher education, academic degree, title...
Nationality	Russians, Ukrainians, Belarusians, Georgians, Armenians, Azerbaijanis, Jews, Tatars...
Religion	Orthodox, Catholic, Islam...
Race	Caucasian, Mongoloid...
Psychographic
Social layer	Poor, middle income, high income, very high income
Life style	Elite, bohemian, youth, sports, urban, rural...
Personal qualities	Ambitiousness, authoritarianism, impulsiveness, herd instinct, innovation, desire for leadership, balance, phlegmatic...
Behavioral
The degree of randomness of the purchase	Usually the random nature of the acquisition. Sometimes the random nature of the acquisition, etc.
Search for benefits	Search for high quality products, good service, lower prices, etc.
Degree of need for the product	Needed constantly, needed sometimes...
Degree of readiness to buy the product	Doesn't want to buy, isn't ready to buy now, isn't informed enough to buy, wants to buy, will definitely buy...
Reason for making a purchase	Everyday purchase, special occasion

By the coincidence of several variable values ​​among certain groups of consumers, we can conclude that there is a certain market segment, as shown in Fig. 4 .

Rice. 4. Types of market segmentation

Market segmentation by product groups

To increase competitiveness and correctly determine the market capacity, in addition to segmenting the market by consumer groups, the market is segmented by product, that is, by the most important parameters for its promotion in the market, using the method of drawing up functional maps (double segmentation method).

The essence of the method is that based on selected market segments by consumer groups and comparing them with various values ​​of factors (functional and technical parameters of the product) selected for analysis, it is determined which parameters are most suitable for the selected group of consumers.

The most common parameters for assessing the market for a product are: price, sales channels, technical characteristics. The results of the analysis using the double segmentation method are presented in the form of a matrix, the rows of which show the value of the factor, and the columns show market segments by consumer.

The firm's market capacity for each product can be calculated using the formula:

,

where i = 1,2,...n is the index of the market segment for the product (product model), selected according to any characteristic,

j = 1,2,..., m - index of the geographic market segment,

d j is the total number of products sold in the j-th geographical segment,

b ji is the share of the i-th market segment by product in the j-th geographical market segment.

Market segmentation by product assumes that at the stage of developing new products for each product model:

All factors are taken into account that reflect the system of consumer preferences and at the same time the technical parameters of the new product that satisfy the needs of consumers (selecting a market segment by product parameter);

Consumer groups are identified, each with their own set of needs and preferences (psychographic segmentation);

All selected factors are ranked in order of importance for each group of consumers (market segments).

All these variables are included in the multifactor model of market segmentation by product, presented in Table. 2.

table 2

Multifactor segmentation model

The multifactor model allows you to identify bottlenecks in product development and influence them through incentives for the common interest of all enterprise services in gaining market share. Market segmentation by competitors

Market segmentation by main competitors is carried out on the basis of an assessment of the competitiveness of your enterprise relative to competitors, given in the recommended table. 3

Table 3

Enterprise competitiveness

Factors of competitiveness	Your enterprise	Competitors
		A	IN
Product Quality Technical parameters Right to replace the product Brand prestige Packaging Dimensions Level of repair service Warranty period Versatility in use Uniqueness (no analogues) Versatility Reliability Service life Patent protection
Price List price Negotiable Free Payment term Credit terms Financing terms in case of purchase
Distribution channels Form of distribution: direct delivery sales representatives manufacturing enterprises wholesale intermediaries commission agents and brokers dealers Degree of market coverage Placement of warehouse premises Inventory control system Transportation system
Promotion of products in the market Advertising: for consumers for resellers Individual selling: incentives for consumers demonstration selling display of product samples Education and training of sales personnel Promotion of products through trade channels: demonstration of products competitive selling bonuses for resellers coupons user manuals television marketing Internet -trade mention of products in the media
Total points:

The data necessary for this type of analysis must be provided by the economic services of the enterprise management apparatus, and the ratings given must be consistent with the opinion of the specialists of these services. To do this, it is best to form a group of the most qualified workers who, together with the management of the enterprise, will be able to conduct this type of analysis. If group members differ in their assessments, the average value of the variable is entered into the table, determined taking into account everyone’s opinion.

During the analysis process, it is important to provide a detailed semantic description or explanation of why a particular variable in the table is assigned a given rating. Only in this case, the overall result of the table (sum of points) will show the true position of the enterprise in relation to its main competitors in the market. You can also sum up the values ​​of the assessments for the main factors and compare these data with the overall result, which will allow the management of the enterprise to find out which factors need to be used to increase competitiveness.

An assessment of an enterprise's competitiveness should be complemented by an analysis of its strengths and weaknesses. The management of the enterprise should receive answers to the following questions:

What plans do competitors have in relation to their market share, increasing production profitability and increasing sales?

What market strategy are your competitors currently pursuing? By what means do they ensure its implementation?

What are their strengths and weaknesses?

What actions can be expected in the future from current and potential competitors?

To systematize the answers to these types of questions, table 1 is used in the checklist for analyzing the strengths and weaknesses of an enterprise in competition. 4 .

Table 4

The method of segmenting competitors by business profile allows an enterprise to quickly move from the stage of market introduction to market expansion, and increase the efficiency of promoting its products on the market.

In table Figure 5 shows an example of systematization of relevant data.

Table 5

Form of analysis of the economic profile of the main competitors

Group of indicators	Competitors
	A	IN
Market Market size Features of market introduction Degree of involvement in the market Market demand Market diversification Product Mastering the production of a product Product life cycle Product competition Product range Design and design of products New products Revision of the range of products Prices New products Released (mastered) products Promotion of products on the market Advertising Sales services Assistance to sales organizations Organization of sales and distribution of products on the market Structure of sales channels Dimensions of sales channels Multiplication of sales channels (forms of development of the sales network) Control of sales channels

The table can contain both brief digital information and extensive and fairly detailed notes. Market segmentation by competitors is carried out in the same way as it is carried out in relation to consumers. Analyzing the data and summarizing the results obtained will help you better understand the business logic of your competitors and determine what responses should be taken and which of them will be the most effective. Therefore, market segmentation by competitors is an integral part of the activities of any enterprise that has decided to seriously increase its competitiveness in the market.

Market segmentation by competitors, consumers, and products complement each other, and all the results obtained are considered and evaluated in a comprehensive manner. Only in this case will the enterprise management be able to correctly select exactly the market segment where the enterprise can best use its comparative advantages.

So, an enterprise can take three approaches to the market:
1. Mass (not differentiated) marketing with the aim of attracting the attention of buyers of all types to one product of the enterprise.
2. Product-differentiated marketing with the aim of offering the market variety and differentiation of the enterprise’s products from those of competitors.
3. Concentrated (targeted marketing), offering appropriate products and marketing mixes for each target market (segment).

After identifying the segments, one or more of the most profitable ones for the enterprise are selected.

Having decided which segment to enter, the company must develop a strategy for penetrating this segment. To do this, the positions of all existing competitors are determined and a decision is made on its own positioning. The company has two options. The first is to position yourself next to one of the existing competitors and begin to fight for market share, the second is to develop a product that is not yet on the market. However, before making such a decision, the management of the enterprise must make sure that there are technical and economic capabilities and that the number of potential buyers of the product being offered is sufficient. If all the answers are positive, then the company has found its place in the market, and this allows it to proceed to the next step - planning the marketing mix.

1.3. Strategic issues in identifying the target market and product positioning

Today, firms are increasingly moving from mass and product-differentiated marketing methods to targeted marketing techniques, which help sellers more fully identify existing marketing opportunities. For each target market, the seller can develop a product that that market needs. To ensure effective coverage of each such market, it can vary prices, distribution channels, and advertising efforts. Instead of scattering his marketing efforts, he will be able to focus them on the customers most interested in purchasing the product.

Targeted marketing requires three main activities:

· Segmentation

· Selection of target segments

· Product positioning on the market

Consumer segmentation

There are two main approaches to market coverage:

1. Aggregated approach.

It is focused on covering the market as a whole by producing a large number of different products (clothing, food, medicine). This approach is appropriate for consumer goods, in a seller's market, as well as in limited or geographically isolated markets with a homogeneous consumer structure.

2. Differentiated approach.

It takes into account different consumer preferences. Segmentation plays a key role in a differentiated approach.

Stages of selecting target markets.

1. Measuring and forecasting demand (market capacity).

2. Market segmentation.

3. Selection of basic market segments.

4. Positioning of the product on the market.

Selection of basic market segments.

The number of segments that you need to strive to reach is determined by the capabilities of the company and the differentiation of segmenting characteristics. There are five ways to reach a market.

Rice. 5. Ways to reach the market

1. Concentration on a single segment.

2. Focus on purchasing power.

3. Focus on a group of consumers.

4. Serving unrelated market segments (selective specialization).

5. Coverage of the market as a whole.

Positioning a product on the market is providing the product with a clearly different desired place in the market that is clearly different from others and creating the necessary sample of the product in the minds of target consumers.

The main reasons for product positioning include six characteristics:

Quality;

A particular way of using the product;

Distinctive properties;

Targeting a specific group of buyers.

Positioning is focused on the selected base segment.

The purpose of positioning is to take a certain position in each basic segment, both in relation to the expectations of potential consumers and in relation to the positions of competitors.

When choosing a product item, you must answer the following questions:

1. What are the distinctive features or benefits, real or perceived, to which customers respond favorably? (Product).

2. How do consumers perceive the positions of competing brands and firms in relation to these features and benefits? (Sales).

3. What pricing policy should I choose, taking into account the expectations of potential buyers and positions already occupied by competitors? (Price).

4. Which marketing channels are best suited to take and defend your chosen position? (Promotion).

Positioning diagram.

Stage 1. The most important characteristics of similar products existing in the target market are determined, which are then presented in a systematic manner.

Stage 2. A diagram of consumer preferences is drawn up based on customer surveys. The base segment is highlighted.

Stage 3. The two schemes are combined, and it is analyzed to what extent the products existing on this market meet the needs of consumers of the base segment and whether it is possible to create a product that has preferable properties for a selected group of consumers in this market.