product differentiation

(noun)

Tangibly or intangibly distinguishing a product from that of all competitors in the eyes of customers.

Related Terms

  • target

Examples of product differentiation in the following topics:

  • The Importance of Market Segmentation

    • While there may be theoretically 'ideal' market segments, in reality, every organization engaged in a market will develop different ways of imagining market segments, and create product differentiation strategies to exploit these segments.
    • The market segmentation and corresponding product differentiation strategy can give a firm a temporary commercial advantage.
    • While product differentiation is an effective strategy to distinguish a brand from competitors', it also differentiates one product from another.
    • For example, a company such as Franco-American Spaghetti has differentiated its basic product by offering various sizes, flavors, and shapes.
    • It is in essence the most likely to buy the product.
  • The Many Goals of Persuasion

    • When running promotional programs, companies seek to clearly and effectively market their product's differential factor.
    • Differentiation sets similar products apart from one another, and creates value for consumers evaluating different brands.
    • Differentiating products allows companies to influence consumers' perception of their brand in an increasingly crowded marketplace.
    • If the product's differential factor is compelling enough, companies hope to convince consumers to continually choose their products over competitors.
    • With social media, companies have the ability to advertise their product's differential qualities to any person in the world, at any given instant.
  • Promotional Objectives

    • There are three main promotional objectives: inform the market, increase demand, and differentiate a product.
    • Eventually a product will reach its saturation point, at which time investing in sales will decrease as the company focuses its attention on a new product.
    • Present information about the product: In order for customers and consumers to want the product they need to understand what the product is and how it benefits them.
    • Differentiate a product: This is especially important if there are multiple competitors in the same market.
    • For example, Apple was able to differentiate itself in the computer industry.
  • Impact of the Product Life Cycle on Marketing Strategy

    • The stages through which individual products develop over time is called commonly known as the "Product Life Cycle".
    • Products typically go through four stages:
    • The product is promoted to create awareness and develop a market for the product.
    • Product features may be enhanced to differentiate the product from that of competitors.
    • In the process, they miss out on opportunities to differentiate themselves.
  • Characteristics of the Product

    • The unique characteristics of a product should be used as inputs in determining the product's marketing mix.
    • The characteristics of the product are the features and elements that differentiate it from other products on the market.
    • A product needs to differentiate itself in the market and carry distinct characteristics that separate it from its competitors.
    • Characteristics of a product also help to determine the price of a product.
    • The characteristics of a product determine the target market and price of a product.
  • Support and Help

    • Excellent customer service can help differentiate a product or brand and may lead to increased brand loyalty over time.
    • Users of mobile phones, televisions, computers, software products, and other electronic or mechanical goods will occasionally need product support services.
    • Product support professionals attempt to help users solve specific problems with a product—rather than providing training, customization, or other support services.
    • The Internet serves as a primary source for freely available product support.
    • Examine the role of support and help programs as a differentiating factor in product design
  • Intangibility

    • It is often used to describe services where there isn't a tangible product that the customer can purchase, that can be seen, tasted, or touched.
    • This is the most defining characteristic of a service that differentiates it from a product.
    • Due to the increasing homogeneity in product offerings, the attendant services provided are emerging as a key differentiator in the mind of the consumers.
    • For example, in the case of two fast food chains serving a similar product (Pizza Hut and Domino's), it is the service quality, not the actual product, that distinguishes the two brands from each other.
    • Hence, marketers can leverage the service offering to differentiate themselves from the competition and attract consumers.
  • Naming Brands

    • Naming a brand is crucial to a product's reputation and success because it reflects its image and benefits in a way that can be differentiating.
    • An example of a brand name that is unique, identifiable, and differentiating is Apple's line of mobile products which all begin with a lower-case "i" (i.e., iPad, iPod, iPhone, iTouch).
    • Naming a brand is crucial to its reputation, development, and future success because the primary function of the brand (name and image) is to identify the product or service in a way that it differentiates it from those of other competitors.
    • iPad is one of Apple's mobile products named with the distinctive "i".
    • iPod Touch is one of Apple's mobile products named with the distinctive "i".
  • Quality

    • When it comes to quality in product design, manufacturers might measure how well products conform to certain requirements or the level of accuracy in products and services following production.
    • Consumers may focus on product features and how well the product compares to competing brands in the marketplace.
    • For manufacturers of products, it is commonly stated that "quality drives productivity."
    • Improving product quality in businesses can lead to better productivity and more innovation.
    • Identify the attribute of quality at the design stage as a differentiating factor
  • Shopping Products

    • In this section, we will differentiate between convenience and shopping goods.
    • If the product is not available when, where, and in a form desirable by the consumer, the convenience product will fail.
    • Although many shopping goods are nationally advertised, often it is the ability of the retailer to differentiate itself that creates the sale.
    • The differentiation could be equated with a strong brand name, such as Sears Roebuck or Marshall Field, effective merchandising, aggressive personal selling, or the availability of credit.
    • Discuss the characteristics of shopping products as a specific type of product
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