Products can be differentiated from competitors in many different ways. Common techniques for product differentiation include:
Each of these factors can help tip the balance in the consumer’s decision making process.
Product differentiation is the general process businesses use to set their products and services apart from similar competitors. The main purpose of product differentiation is to increase sales and brand recognition.
Differentiating a product can help make it more attractive to consumers. This could be achieved with new design features or better value for money. New features are especially useful for making a product stand out when it occupies a saturated marketplace with many similar competitors. For example, a customer may walk into a store and see three products with exactly the same function or purpose. In this case, factors like price or design will help steer them to one product in particular.
Many forms of product differentiation are subjective. Things like design features or brand messaging can be interpreted differently by different customers. The impact of differentiation via monetary cost, however, is easier to predict and measure.
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