Marketing91

  • HOME
  • Categories
    • Marketing Management
      • Marketing basics
      • Marketing Articles
      • Careers in Marketing
      • Market Research
      • Retail Marketing
      • Services Marketing
    • Strategy
      • Marketing Strategies
    • Management
    • Branding
    • Small Business
    • Sales & Selling
    • Advertising
  • Online Marketing
    • Blogging
    • Social Media Marketing
    • Search Engine Optimization
    • Internet Marketing
    • Ecommerce
  • Brands
    • Marketing Mix of all Brands
    • SWOT of Brands
    • Brand Competitors
    • Marketing Strategy of Brands
    • Business Models of Brands
  • Videos
Home » Marketing strategy articles » Differentiation strategy definition

Differentiation strategy definition

May 26, 2020 By Hitesh Bhasin Tagged With: Marketing strategy articles

Differentiation strategy is one of the most important marketing strategy in today’s business environment. With so many brands and so many varieties of products and so much advertising noise, it becomes very difficult but ultimately very necessary to differentiate your brand from competition. Thus, Differentiation strategy is being used by all top companies for their products. There are various ways to differentiate your product via using a differentiation strategy .

Table of Contents

  • 1) Innovation / Invention –
  • 2) Product-level differentiation –
  • 3) Price differentiation strategy –
  • 4) Branding –
  • 5) Packaging –
  • 6) Service pre sale and post sale –
  • 7) Point of customer interaction –
  • 8) User convenience –
  • 9) Offer variety of products –
    • Related posts:

1) Innovation / Invention –

The best way to implement differentiation strategy is to invent or innovate. By innovating or inventing, you become the market leader because your product is the first entrant in the market. Inventions are of course difficult and require regular R&D expenditure. But innovations are more practical and are a Differentiation strategy used by technological companies like Apple and Google.

differentiated strategy

Differentiation differentiated business review ch hubspot product firm mind tools lesson inbound marketing tools customers free brand

2) Product-level differentiation strategy –

Observed in many industries, Differentiation strategy can be executed at product level too. Taking an example of the tourism industry, tour packages of all companies are different and the tour package might have its own differentiating factors. Some might be giving international tours whereas others will be giving national and regional tours only. Thus, by incorporating product differentiation strategy at product level, the brands can use differentiation strategy themselves from competitors in the eyes of the customer.

3) Price differentiation strategy –

The most used form of differentiation strategy is price differentiation. In the above example of tour packages, some brands might give the luxury package whereas other brands might give a cheap and affordable pricing. Mobile handset companies like Samsung and apple target the cream segment whereas companies like Micromax and Xolo target the price sensitive segment. Price segmentation is the biggest Differentiation weapon in the hands of marketers.

Also Read  6 Advantages of Segmentation

4) Branding –

Your promotion mix and the marketing communications of the company play a crucial role in the differentiation strategy of your product. Companies like Pepsi and Coke rely heavily on their branding efforts to convert the customer to their products. Thus, youngsters will like pepsi, young adults will like Thums up, families will like Fanta, and Coke can be an all time favorite for everyone. Your promotion mix helps you target the correct segment and hence plays a crucial role in differentiation strategy.

5) Packaging –

If you go to any publications and ask them what are the critical factors in selling a book, the publication agency will say that, after the story of the book, the top cover of the book plays a critical role in the success of the book. In fact, many a times, customers might buy a book based on the top cover. Thus, packaging is important. The same can be seen when you enter a mall and you have 100’s of shelves with different types of cereals, soaps, shampoos, detergents etc. At such a time, the color, the packaging, the taglines, the ease of handling can play an important role in converting the customer to your brand. The tetrapack introduced by Frooti in the Indian market was a wonderful example of Packaging playing a role in differentiation strategy.

6) Service pre sale and post sale –

Word of mouth marketing is another product differentiator and all brands targeting a niche audience know the importance of word of mouth marketing. And how does word of mouth marketing happen? Through very good pre and post sales service. Ever heard a friend say that not only does the restaurant serve good food, but the service and the ambiance are awesome as well? Thats the service i am talking of. If your service is beyond customers expectation, than that can be a big boost to your differentiation strategy.

Also Read  Marketing strategy of Colgate - Colgate marketing strategy

7) Point of customer interaction –

There are Sec A, B and C segment customers. You have to ensure that you take care of all kinds of customers when they interact with your company. For this, you have to take care of point of interactions and ensure that the customer has a good experience whenever he interacts with the company. In fact, banks and retail showrooms regularly have audits to ensure that the front end staff is polite and helpful to customers because this can be a major point for differentiation. A service company, which does not have good interactions with the customer will always suffer in its profits and operations.

8) User convenience –

The banking industry shows us an example of how User convenience can help you in your differentiation strategy. The banks differentiate themselves with the type of net banking services they offer as well as the number of ATM’s that they have in your vicinity. This is an excellent example of differentiation through user convenience. If you are taking care of user convenience, the customer will always come back to you. This is the reason why, even though there are so many big retail outlets in the market, the smaller shops still run well. This is because they give personalized service to a handful of customers and the customers find it convenience to shop at the local retail store.

9) Offer variety of products –

Another way to implement differentiation strategy is to attack the psychology of the customers. Many a customer will tell you that they picked a brand just because the brand had more variety in the number of products it offered. A customer, during prospecting, likes to have more variety so that he finds the right product and can pick that product for himself. Thus, the more variety of products you offer, the more chances you have of getting a higher positioning in the mind of the customer and therefore, differentiating yourself from competition. This is a high investment strategy, because you need to invest in a product line, but it is useful and profitable in the long run.

Also Read  Gap analysis

Thus, there are many ways for implementing a differentiation strategy. What the company has to realise is that it cannot sit back and enjoy the customers loyalty today. In this saturated business environment, each and every company has to take steps to differentiate itself from competition and ensure that it has a high positioning in the customers mind. An example of this is websites and google. If a website is not in the top 10 pages of google, than it is likely to be ignored by 50-60% of the searchers on google. Thus, by improving your website and your content, you can reach the top 10 on google and differentiate your website from others.

Can you suggest any more tactics or examples of differentiation strategy?

Related posts:

Competitive strategies - 1Competitive Strategies – Definition, Limitations, and the Importance Product differentiationProduct Differentiation Strategies - 33 Main Types of Business Strategies Planning Marketing strategy of Coca colaMarketing strategy of Coca cola – Coca cola marketing strategy Bowman’s Strategy Clock - 2What is Bowman’s Strategy Clock? Marketing strategy of Airtel - 2Marketing strategy of Airtel – Airtel marketing strategy Marketing strategy of CadburyMarketing strategy of Cadbury – Cadbury marketing strategy Importance of strategyWhat is the Importance of strategy to a Business or an Organization? 5 P’s of Strategy - 1The 5 P’s of Strategy explained Strategy FrameworkThe Top 10 Strategy Framework for Businesses Explained
Also Read  Ansoff Matrix Theory Examples of Business Strategies for Future Growth

All Knowledge Banks (Hub Pages)

  1. Marketing Hub
  2. Management Hub
  3. Marketing Strategy
  4. Advertising Hub
  5. Branding Hub
  6. Market Research
  7. Small Business Marketing
  8. Sales and Selling
  9. Marketing Careers
  10. Customer Management
  11. Top 10 Lists
  1. Internet Marketing
  2. Blogging
  3. Search Engine optimization
  4. E-commerce
  5. Facebook Marketing
  6. Social Media Marketing
  7. Business Model of Brands
  8. Marketing Mix of Brands
  9. Brand Competitors
  10. Strategy of Brands
  11. SWOT of Brands
GET DAILY MARKETING UPDATES

About Hitesh Bhasin

I love writing about the latest in marketing & advertising. I am a serial entrepreneur & I created Marketing91 because i wanted my readers to stay ahead in this hectic business world. You can follow me on Facebook. Let's stay in touch :)

Comments

  1. Tween Clement says

    I am student at university of Education, Winneba doing Bachelor of Business Administration (Accounting ) please send me information about this course

    Reply
  2. KEOBOUNPHANH PHONTHIDA says

    Hi
    I am writing my thesis about the different ways of differentiation. Would you mind sending me the reference of this article please. I would like to look deeper into it.
    Thank you in advance.

    Reply

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Recent Posts
  • What is Benefits Administration? Definition and Steps
  • What is coaching? Different coaching styles
  • What is Corporate Training? Types and benefits
Advertisement

Marketing91

MORE INFO

  • About Marketing91
  • Privacy Policy
  • Cookie Policy
  • Disclaimer
  • Terms of Use
  • Advertise
  • Contact us
  • Sitemap
  • ISO 9001:2015 Certified

LEARN WITH US

  • Course on Market Segmentation
  • Course on Marketing Strategory Models

WE WRITE ON

  • Marketing
  • Small Business
  • Management
  • Internet Marketing
[email protected]

Copyright © 2020 Marketing91 All Rights Reserved