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Factfile 43

Why market mapping is so important

Market mapping, as described here, is a technique for clearly presenting how your market operates today and how it is expected to evolve over the next few years.

• By transposing onto that general picture your own company' activities and those of your key competitors, market maps become a powerful tool for developing channel strategies and for determining the allocation of sales and marketing resources.
  
  
• Market maps are also a key stage in the segmentation process as they identify the location of decision makers in a market and hence where a segmentation project should be focusing. (see also segmentation).
  
  
• Market maps can be used to present a wealth of information about your markets and become important reference documents within the company. For some companies, updating these maps has become an annual activity and questions about channels, influencers and decision makers are built into appropriate ad hoc market research projects and into any appropriate ongoing market research exercises.

An overview of market mapping

Few, if any b2b markets consist simply of suppliers directly serving a single group of final users through a single channel.

Most b2b markets are more complex than this and may contain any (or all) of the following:

• intermediaries adding value to the original product or service;     
• various distribution channels;     
• a variety of influencers (such as consultants); as well as     
• different decision makers.

It is possible to capture all of this on a 'map' which depicts the different routes that exist between the final user and the originator of the product or service.

An example of a top-line market map appears in the figure below.

Figure 13: Example of a top-line market map



Source: © Malcolm McDonald and Ian Dunbar 2002.

• By extending the detail on this map to capture the proportions of business that go along the different routes, a particular company?s share along these routes and their share at the various decision-making stages, the map will illustrate where a company is weak and where it is strong. 
  
  
• In addition, by looking at the company's allocation of sales and marketing resources in relation to the decision making structure, shortfalls and excesses can also be revealed. Extend the market map into the future and you now have a powerful strategic tool for developing channel strategies and resource allocation. 
  
  
• For many companies, their market map is more complex than the map appearing in Figure 13.

For more details on how to construct a market map see the resources section.

The material in this factfile has been contributed by Professor Malcolm McDonald and Ian Dunbar of The Market Segmentation Company. A joint authored book - Market Segmentation: How to do it; How to profit from it (2nd edition) Palgrave, 1998, ISBN 0-333-73369-X -  takes an in-depth look at this topic. For more information see www.MarketSegmentation.co.uk.

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