What does competitive analysis aim to define?

Competitive analysis primarily focuses on understanding the economic structure of a market by evaluating the strengths and weaknesses of competitive entities within that market. This involves assessing factors such as market share, pricing models, product offerings, and overall strategic positioning in relation to competitors. By defining the economic structure, businesses can make informed decisions regarding their own strategies, identify opportunities for differentiation, and establish competitive advantages.

While understanding customer needs, supplier locations, and regulatory requirements are important aspects of market research, they fall under different analytical frameworks. Competitive analysis specifically targets the dynamics between competitors and how they operate within the market, providing insights that are necessary for businesses to position themselves effectively against rivals.