What is the target model?
The target model is a strategic analysis tool that helps you gain an overview of your competitive landscape. The model organizes your competitors into four concentric circles, just like a target, where the distance from the center indicates how direct the competition is. This provides you with a visual and logical system that makes it easier to understand who you’re actually competing against—and at what level.
At the center, you’ll find companies that offer a product that closely matches your own and targets the same audience. The outer rings, on the other hand, contain products or services that meet the same basic needs but do so in a different way. In other words, the model moves from direct product competition to a broader competition based on needs. This structure helps you view the market in layers rather than just in terms of direct opposites.
You can use it in many contexts—whether you're working on strategy branding, marketing, or SEO. In SEO, it’s used, among other things, to assess which competitors you should actually compare your visibility to, and where you can find inspiration to strengthen your own position in search results.
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How do you use the target model?
To use the target model, start by defining your own products, your core value, and the target audience you’re addressing. Once you have that in place, begin placing your competitors in the rings, starting from the center and moving outward. The process requires both market insight and an honest assessment of what your business actually offers.
Here's how you can apply the logic of the rings in a practical analysis:
- Innermost ring: Identify the companies that offer the same product and target the same audience as you. Here you’ll find the companies with which you share the most traffic, customers, and keywords.
- Step 2: Identify competitors who sell the same product but to a different target audience. This can provide insight into new segments you could potentially expand into.
- Ring 3: Identify competitors in the same product category, but not necessarily at the same price point or with the same positioning.
- Circle 4: List players that meet the same overall need in a different way—for example, products that can serve as an alternative to your own for consumers.
By categorizing competitors in this way, you can analyze patterns in the market. You can see where competition is fiercest and where there is room to differentiate yourself. The model also helps you set priorities: You can focus most of your attention on the competitors in the middle, while keeping an eye on the outer layers to spot new trends and substitutes.
That's why you should use the target model
The target model is useful because it condenses a complex market into a simple visual structure. It allows you to identify where you stand in the market and how you can create a distinct brand compared to others. In practice, this makes it easier to decide where to allocate your marketing resources most effectively.
For example, if you work with SEM or social media marketing, you can use the model to decide which competitors’ advertising to monitor closely and which ones to keep an eye on from a distance. It provides a basis for prioritizing your efforts—not just based on who’s in the market, but on how much real influence they have on your target audience.
It also helps with strategic positioning in branding and communication. You can use insights from the model to define how your brand differs from those closest to you, so that you don’t communicate the same message as your closest competitors.
How do you use the target model in practice?
In practice, working with the target model requires you to gather data from multiple sources. You should analyze keywords, target audience behavior, and the media landscape. When working with SEO, you can supplement your analysis by examining your competitors’ visibility, backlink profiles, and content strategies. This will give you a concrete understanding of how your direct competitors are performing online.
An example of a practical approach:
- Start by selecting 10–15 competitors that represent both your direct and indirect competition.
- Collect visibility data and traffic estimates using SEO tools so you can place your competitors within the four rings based on factual information.
- Analyze where the overlap is greatest, and identify where you clearly stand out in terms of content, design, or price.
- Next, tailor your communication, content, and digital strategy to strengthen your position in the segments where you want to compete most actively.
So it’s not just about figuring out who your competitors are. It’s just as much about understanding how to apply that knowledge to your marketing, design, and strategic planning. When you combine the model with ongoing analysis of performance data from sources such as Google Ads or your social media channels, you gain a more comprehensive understanding of the market.
Analyze the competitive landscape using the four elements
The target model is based on four rings that determine the size of the competitive field. The final assessment depends on how you define your competitors. If you’re competing on price, you should be aware of all products in the same price range. If you’re operating in a niche market, the specific products vying to be the best are the ones that matter. So make sure you have a solid overview of the market and your competitors before you get started.
Same product
In the innermost ring, competitors are all companies that offer the same product or service at a similar price. The target audience will typically perceive the products as more or less identical, which means that competition is tight and based primarily on brand value. A classic example is Coca-Cola and Pepsi.
Same product category
In the next tier, competitors are companies that offer products in the same category—but not necessarily at the same price. Price therefore often becomes the deciding factor, and the competitive landscape is slightly broader. One example is SAS and Norwegian, which both offer air travel, but at different price points.
The same basic needs
In the second-outermost ring, competitors are companies that meet the same basic consumer need—without their products necessarily being identical. One product can substitute for another, which can be both an advantage and a disadvantage. An example is airlines and rail companies: both offer transportation, which is the essential need the consumer wants met.
All Products
In the outermost ring, all companies—regardless of industry—are considered potential competitors, since they are all competing for consumers’ income. The competitive landscape is at its broadest here, and your company is, in principle, competing with everything from beauty products to kitchenware.
What should you keep in mind?
When using the target model, keep in mind that the market is constantly changing. New products can quickly move from the outer ring toward the center if they become popular or change customer expectations. This means you should update your analysis regularly so that you always base your decisions on an up-to-date picture of the competitive landscape.
You also need to be realistic when placing competitors in the rings. It’s easy to overestimate how different your own product is, especially if you’re looking at it from the inside. Therefore, use objective criteria such as price, features, distribution channels, and customer profile to place competitors as accurately as possible.
Finally, keep in mind that the target model doesn’t stand alone. It works best when you combine it with other analytical tools—such as data from your keyword analysis or insights from digital strategy and branding. That way, it becomes an active part of your overall marketing effort, not just an exercise on paper.
