Analyzing Strategic Activities in Market Structural Gaps through Social Network Analysis

In a rapidly changing market, a firm has to find its strategic position in order to gain competitive advantages. In general, market structural gap analysis is to look for opportunities in a market where no supplier provides a product/ service that customers need. From network perspective, a network could includes many holes where only few connection among actors. The concept of “structural holes” (Burt, 1992) have been wildly used to understand the actors’ competitive advantages. Thus, one of business strategies for firms to get structural advantages is to place themselves in critical positions (Gulati & Gargiulo, 1999). The position in the market network possesses significant impacts on firm performance and is an important source of competitive advantage (van Heck & Vervest, 2007; Vervest et al., 2005). The concept of network structure can be used to detect the gaps existing in the market. Some positions are more beneficial than others, and firms will attempt to change their current position to reap more benefits. Thus, beneficial network positions contain the seeds of network position dynamics because firms are triggered to improve their own current position. This paper intents to examine the market structural gaps from the viewpoints of Social Network Analysis (SNA). In addition, brand switching matrices are chosen to represent market network structure.