Product and market orientation, and market mapping

Product orientation

A product-oriented business focuses on the product itself: it develops what it is good at making, often driven by technology or quality, and then looks for customers.

• Suits markets driven by innovation (pharmaceuticals, high technology) or luxury goods where quality sells itself.
• Risk: the firm may make products customers do not want, and miss changes in tastes.

Market orientation

A market-oriented business starts with customers: it uses market research to find out what they want and then designs products to meet those needs.

• Benefits: products more likely to sell, faster response to change, better customer loyalty.
• Costs: research is expensive, and constantly following customers can make it hard to create radical innovations customers did not know they wanted.

Most firms combine the two: strong products informed by research.

Market mapping

A market map (perceptual map) is a diagram with two axes showing features customers care about, for example price (low to high) and quality (low to high), or traditional to modern. Each brand is plotted where customers see it.

Uses:

• Spot gaps in the market where no brand is positioned.
• See where competitors are clustered and which brands are close substitutes.
• Decide how to position or reposition a product.

Limitations: only two variables at a time; positions are based on perceptions, which vary between customers; a gap may exist because there is no demand there.

The June 2024 WBS11 paper asked candidates to assess the benefits of market mapping to a start-up (10 marks).

Worked example

A market map of chocolate bars, with price (low to high) on one axis and healthiness (low to high) on the other, shows many brands in low price/low healthiness and a few in high price/high healthiness, but none in low price/high healthiness. What should a firm consider before filling the gap?

1. The gap might be an opportunity: affordable healthy bars.
2. Check with market research that customers want it and enough would buy.
3. Check whether healthy ingredients can be produced cheaply enough to make a profit.

Answer: A gap is only worth filling if research shows demand and the firm can make the product profitably at that position.

Check yourself

1. A firm surveys customers to find out what features they want, then designs a product to match. It is
   • product oriented
   • production led
   • market oriented
   • asset led
   Show answer

   market oriented. Starting with the customer is market orientation.

2. In which market is product orientation most likely to succeed?
   • A market for innovative high-technology products
   • A market where tastes change every few weeks
   • A market where customers want tailored products
   • A market where research is cheap and easy
   Show answer

   A market for innovative high-technology products. Innovation-led products can create demand customers had not imagined.

3. What is a market map?
   Show answer

   A diagram that plots brands or products against two features that customers consider important, such as price and quality, to show how they are positioned.. Two axes of customer-relevant features, with brands plotted.

4. Why might a gap on a market map NOT be a good opportunity?
   • Gaps always mean high profits
   • There may be no customer demand for a product in that position
   • It shows there are too many competitors
   • Market maps always use real sales data
   Show answer

   There may be no customer demand for a product in that position. A gap can exist because nobody wants that combination.

5. Explain one benefit to a start-up of using a market map.
   Show answer

   It helps the start-up identify a gap in the market where there are few competitors, so it can position its product to be different and attract customers.. Identifying gaps and competitors' positions.

6. What is a drawback of market orientation?
   • Products are less likely to meet customer needs
   • Market research can be expensive and may limit radical innovation
   • The firm ignores customer feedback
   • It means the firm stops doing research
   Show answer

   Market research can be expensive and may limit radical innovation. Research costs money, and customers rarely suggest radical new ideas.

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Sources

• Pearson Edexcel International Advanced Subsidiary/Advanced Level in Business specification (2018)
• Pearson WBS11/01 mark scheme, June 2024

Last updated 8 November 2026. Spotted a mistake? Tell us.