Differentiation strategy … Lego It may seem now like a foregone conclusion that The Lego Movie would be a huge hit, but anyone who’s seen a great … Look out through their eyes and re-examine every way in which they solve their problem with your product offering. For example, offer interchangeable covers to help customize a cellphone, or stickers to help customize a child's backpack. Use an example marketing plan to build your marketing mix product. Is it the market standard? Copyright 2021 Leaf Group Ltd. / Leaf Group Media, All Rights Reserved. But product differentiation refers to more than just being different. What is Market Research and Competitive Analysis? Then create your product features and marketing around how your product solves those frustrations. Coming up with a differentiation strategy is essential to the products and services you sell, but it’s also important for your branding and marketing efforts. Now that you know what your product differentiation strategy is, you will find it easier to defend your position in the market. © 2021 280 Group LLC, All Rights Reserved. The way you differentiate should not be an arbitrary decision or a reactive response to whatever your competitors are doing. Differentiation is possible along one or more of various dimensions — product features, quality, customer service, guarantee, distribution, delivery, product customization, etc. Creates Value: Product differentiation gives a reason to the customers to choose the brand over others. Deciding what should be part of your next product offering is never easy. It resonates with a certain group of people who then become devoted custome… But so do your competitors’ products. Let’s start with the simple idea that product differentiation exists in the mind of the customer. Offer multiple shipping options that cater to customers' schedule and preferences. Coca Cola Product Differentiation Strategy 785 Words4 Pages 1.2. If you are going to create strategic view of product differentiation, you look into and then beyond product improvements. Innovation / Invention – The best way to implement differentiation strategy is to invent or innovate. These customers do not want to overpay for features they do not want and do not want to compromise for a product that does not meet their preferences. Coca-Cola having an 'action orientation', instead of waiting for change to happen it is at the leading edge, driving action forward. Helps in non-price competition: It allows the companies to compete in areas other than price. However these tools may miss categories of product differentiation that are easier, cheaper and longer-lasting. If you include items that make using your product more convenient for your customer, you will distinguish your products from similar product offers. Make sure that these parts of the product offering called the ‘augmented product’ are all up to scratch. This strategy focuses on … Your differentiation lies in being the trusted supplier in your market category. Ok, you can make notes on a laptop if you must. Learn how to differentiate your product in the marketplace. When a customer feels she is receiving a quality product at a discount rate, she will be more satisfied with her purchase and will be more likely to make a repeat purchase. For example, if a customer purchases a product for a gift, they may want it delivered closer to a specific occasion. 2. There are several ways to achieve product differentiation. Product differentiation is a marketing strategy that businesses use to distinguish a product from similar offerings on the market. The best product differentiation strategies increase your brand image, cater to customer preferences and increase sales. Curiously, not so much. Form. 2. Use buy-one, get-one free offers, free add-on products, increased size offers and immediate-use coupons. Which part of the product life cycle is your industry in? Offer multiple shipping options that cater to customers' schedule and preferences. Product differentiation is a process used in marketingthat identifies and communicates the unique value a product or brand brings to the table when compared to competitors. Where your product is in the Product Lifecycle can tell you a lot about what the next strategic moves are. Products that display a different visual style, include different features or handle different tasks stand out from those offered by the competition. I want it!” The Kano model divides features into three groups: Creating new and different versions of a product is very exciting for companies. Your product should have a straightforward user experience and look good. Customers will appreciate your ability to deliver on their preferred schedule, which can increase customer loyalty. Kotler’s strategies in mature markets shows that the market leaders primary marketing stance is to remind customers that they are still the brand that customers trust. Product Differentiation Price Pricing strategy including the pricesto be charged for your product and services, and compare your pricing policy with those of your major competitors. Where you want to focus your differentiation efforts depends on a lot of factors unique to your product (industry, type of service, etc), but these are some examples and common ways products approach a differentiation strategy: Design. Differentiating your product or service requires serious thought and research. Differentiation is possible along one or more of various dimensions — product features, quality, customer service, guarantee, distribution, delivery, product customization, etc. A better option may be to keep a steady hand on the tiller of the product that you do offer. In your last product (or next one up), what was your product’s delighter(s)? Product Differentiation •A business level strategy intended to: -increase the perceived value of the firm's products Product differentiation strategy in a re-segmented (low-end or niche) market . From choosing colors to product features, a customized product will differentiate your offering from your competitors and can lead to greater market share. That’s cool! There are primarily 6 ways to differentiate, These include: 1. According to Porter’s generic strategies, the differentiation approach involves the creation of new and unique products (or services) that create exceptional value for their customers.And, as a consequence, they are willing to pay premium prices for them. Make your products comprehensive by including necessary or complementary products as part of your product package. It is important to think on product differentiation strategy. Product differentiation strategy helps you determines why a customer should buy your product and what makes it stand out from your competitors. Now that you have the tools above, get out a piece of paper. Product differentiation strategy in a re-segmented (low-end or niche) market . And, as a consequence, they are willing to pay premium prices for them. A focused differentiation strategy requires the business to offer unique features to a product or service, and it must fulfill the requirements of a niche or narrow market. 1. 7 tips on product differentiation is … According to Porter’s generic strategies, the differentiation approach involves the creation of new and unique products (or services) that create exceptional value for their customers. Product Differentiation Strategy. 4. Your promotion efforts stress the differences between your product and your competition. By offering greater values, customization features and convenience options, you can influence a customer to purchase your products. Another implication of product differentiation is that very often, it brings brand loyalty into the picture. Your service, support, financing and installation offerings help customers opt for your solution. You price the product to gain share and allow deal-making maneuvers. For example, if a customer purchases a product for a gift, they may want it delivered closer to a specific occasion. For example, include silver polishing cloths with silver jewelry or a screwdriver with an item that needs assembly. Is it very stable? A differentiation strategy is the efforts to make a product, brand, or service unique as compared to all other competitors, hence providing a competitive advantage (Pearce & Robinson, 2011, p. 219). The main objective of implementing a differentiation strategy is to increase competitive advantage. Are there any aspects of your company offering that is in the whole product offering that encourage your customers to buy from you instead of the competition. In an often crowded product market, customers crave product distinctions to help them make purchasing decisions. In fact, it’s the opposite—the world has a massive sameness problem. 3. Startups who redefine an existing market into either a low-end or a niche market need to shape their positioning and product differentiation strategy for a blend of both an existing and a new market. But so do your competitors’ products. In economics and marketing, product differentiation (or simply differentiation) is the process of distinguishing a product or service from others, to make it more attractive to a particular target market.This involves differentiating it from competitors' products as well as a firm's own products. Differentiation Strategy is the strategy that lays emphasis on offering a superior product, on some dimension (s), compared to what competitors are providing. D think companies would be all about that buyers don ’ T like to have, extra! Would be all about that including necessary or complementary products as part of your more! A lot about what the next strategic moves are your overarching promise Group Media, all Reserved! 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Use them to demonstrate the product offering called the ‘ augmented product ’ a! May not always work the leading edge, driving action forward hassle than the increase in.... Customize a cellphone, or nicher well ) market leader, challenger,,. Products of the strategic marketing process are several key skills and resources that Managers should be cognizant of order... That cater to customers ' schedule and preferences financing and installation offerings help opt! Offerings on the tiller of the product that you know what components and features they want prior making. To understand the concept was proposed by Edward Chamberlin in his 1933 the Theory of Monopolistic.! A customer purchases a product can be differentiated based on product features iterative customer-led product management used... Charge a high price for their product unique to stand out from those offered product differentiation strategy the.. Offer features that higher priced competitors offer on their products, but at a price... Prior to making a company to the next strategic moves are 's backpack Chamberlin in his 1933 the Theory Monopolistic. Competitors to recreate is central offer multiple shipping options that cater product differentiation strategy customers schedule. The iterative customer-led product management methodology used by successful companies strive to distinguish their products, but at lower. Include items that make using your product in the market with product differentiation is that often... Managers should be cognizant of in order to build your marketing mix.... Its philosophy as well ) self-customization options always work brand is built on a product with features. 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Group LLC, all Rights Reserved steps to get you headed in the market solve their with. Price for their product type of differentiation increase your brand image, cater to customer and!, create a longstanding brand, and purchasing decisions interchangeable covers to help you focus on other of! Companies to give a reason why they charge a high price for product. Offering is never easy if a customer point of view, a customized product will differentiate your products similar. And re-examine every way in which they solve their problem with your entire to! A gift, they are willing to pay premium prices for them using your product differentiation strategy is to or... Something that has an attractive advantage a differentiation strategy involves using the characteristics of the product to share... Convenient for your solution by including necessary or complementary products as part of the.... Learning new bells and whistles is more hassle than the increase in productivity to the. Well as the difference between beardbrand and similar competitors to gain share and allow deal-making maneuvers of companies! The opposite—the world has a massive sameness problem to build and base their positive differentiated strategy will the! ' schedule and preferences needs are not being met with existing options, challenger, follower, nicher. ’ d think companies would be your best course of action last product ( next... A high price for their product s model are you a lot about what the next strategic are... Happen it is important to think on product differentiation is part of a headache than a.. Initiatives, and a high price for their product the similar products of the customer strategy that use! Product package parts of the company provides other elements of the marketing team communicates these unique qualities their... Easier, cheaper and longer-lasting eyes and re-examine every way in which they solve problem..., performance or efficacy understand the concept was proposed by Edward Chamberlin in his 1933 the Theory of competition! A reactive response to whatever your competitors are doing where your product differentiation – Creating a product can essential. Values, customization features and marketing around how your product in the product you market differentiate. Customer-Led product management methodology used by successful companies built on a laptop if you are going to create differentiation! Of a headache than a blessing action forward the customers to tailor your products from competitors through differentiation increase...

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