Price Gap Analyzer
Visualize the exact premium or discount you hold against specific competitors. Identify where you are over-priced or leaving money on the table.
Configuration
Price Gap (%)
Gap Analysis
Average Positioning: +4.5% vs Market
Premium Exposure
You have significant premiums (>20%) against some rivals. Ensure your value prop is clear.
Discount Depth
You are deeply discounting against some players. Check if you are leaving margin on the table.
Market Alignment
You are closely aligned with the market average. Competition is likely non-price based.
Execution Steps
Enter your current 'My Price'.
Add competitors with their current shelf prices.
The chart visualizes the % Gap. Positive bars mean you are more expensive (Premium). Negative bars mean you are cheaper (Discount).
Use the analysis to justify premiums or spot dangerous undercutting.
Pro Strategy
- If you are >20% more expensive than the Market Leader, you need a massive differentiator (Feature or Brand) to sustain sales.
- If you are cheaper than the 'Discounter', you are likely eroding margin unnecessarily unless your cost structure is vastly superior.
- Monitor gaps weekly. Competitors often test small price moves to see if you follow.
Core Concepts
Price Gap
The percentage difference between your price and a competitor's. Formula: ((My Price - Comp Price) / Comp Price) * 100.
Premium Threshold
The maximum price gap a customer will accept before switching. Usually 10-15% for similar goods, higher for strong brands.
Commoditization
When gaps shrink to near 0%, the market views products as interchangeable commodities.
What is Price Gap Analyzer?
Price Gap Analysis calculates the relative distance between your price point and the competitive set. It normalizes differences into percentages, allowing you to compare positioning across different product tiers.
Best For
- • Setting MSRP for a new product launch.
- • Responding to a competitor's price cut.
- • Quarterly competitive reviews.
Limitations
- • Focuses on price only, ignoring value/features.
- • Static snapshot (prices change daily).
- • Doesn't reflect shipping costs or taxes.
Alternative Methods
Value Map
Plotting Price vs Quality to see if the gap is justified.
Price Index
Aggregating gaps across a whole basket of goods.
Industry Applications
See how this methodology generates real revenue uplift in different sectors.
Consumer Electronics
Sales slowed despite being cheaper than Sony/Samsung.
Gap analysis showed they were 40% cheaper. Customers perceived this as 'Low Quality' signal.
SaaS CRM
Losing deals to a new startup.
Found the startup was undercutting by exactly 10% on every tier.