Market Attractiveness

What is it?

Market attractiveness is a measure of how likely it is that abnormal profit can be generated. It is of great significance in the “positioning” school of strategy

When is it useful?

It is one axis in the GE Matrix to use to prioritise segments/markets

An Example?

How do you do the analysis?

Ultimately comes down to a judgement call, but markets attractiveness is a function of:

  • Growth rate
  • Absolute size
  • Customer power and price sensitivity
  • Competitive Structure and Behaviour
  • Barriers to entry and lack of substitutes
Porters 5 Forces for each

Extra insight can be if assess how market attractiveness is changing

I want to know more

Michael Porter: Competitive Strategy

How can you adapt this concept?


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