product differentiation examples

Chapter 6: Imperfect competition and international trade. By day, I lead a tech team of 10 folks for an e-commerce startup. A product can be differentiated based on the form of the product. The different factors on which the process is implemented include: This can then be communicated in their marketing and sales strategy, for instance when talking to customers or creating marketing campaigns. In recent times, Zoom has risen to worldwide prominence, becoming the poster child for the accelerated growth digital businesses experienced during the pandemic. Airstream Main competitors: Fleetwood, Jayco, Winnebago. Differentiation strategies can be used in a variety of industries and business types. It mentions its philosophy as well as the difference between Beardbrand and similar competitors. Which begs the question: why do people perceive and rate comparable products that different? Some of the most prominent examples include Apple’s iPhone, Sony’s PlayStation, or Toyota’s Corolla car.eval(ez_write_tag([[300,250],'productmint_com-banner-1','ezslot_5',173,'0','0'])); Let’s look at some recent examples in the section below. Now, what does this look like in action? While some students may succeed with straightforward worksheets, others require a variety of assessment options. Vertical differentiation exists when consumers compare a product according to one feature – quality. Product differentiation: Product differentiation is process commonly used by business. The winning entry would be the template for a new limited edition Starbucks cup. 1021 Words 5 Pages. by going too far with a message) or too niche. 2. Well, three rounds and wrong guesses later, that sweet ol’ Coke she claimed to love so much wasn’t that great of a distinctive taste. Or just ask Evan Spiegel what he thinks of Instagram’s blatant copy of its Story function. If your product differentiation advantage lies within one or few features, competitors catching up is just a few sprint iterations away. 1. What is the definition of product differentiation? Examples Of Product Differentiation. For this process to be successful, it is essential to identify and communicate the product’s unique value proposition while highlighting the distinct differences to competing products. Hereby, products are differentiated based on a multitude of factors. Now that we’ve looked at the categories of product differentiation, let’s look at the specific factors that can differentiate products. Specify target audience: Knowing what it is that draws customers to a product allows businesses to specifically target customers that are attracted by these sets of features. Examples include Coca Cola vs. Pepsi or Pampers vs. Huggies. Product Differentiation Defined. It resonates with a certain group of people who then become devoted custome… Making a product stand out against a similar competitor’s product is difficult for any company. Examples of Differentiation in Marketing. Here customers across the country were asked to doodle on their Starbucks cups and submit pictures as entries. Taking a look at Apple’s launch of the iPhone 11 shows the company’s willingness to target a different set of consumers for the same product category. A product can be differentiated based on its form, shape, quality, durability, reliability, repairability, style, design, or some other features of the product. Product Differentiation depends on how the brand sees its product, and how the customer recognizes the product. In this article we will discuss about the sources and importance of product differentiation. The differentiation strategy of product leaders is to deliver superior value through leading-edge products that enhance customer benefits. A feature that also differentiates the two medications is ‘price.’ Brand names are much more expensive than generic medications. When users file a claim, smart AI programs will assess the claim first. Assessing such an opportunity is therefore tied to the Total Addressable (TAM) as well as Total Obtainable Market (TOM). It is process of distinguish a product or services from similar offerings in the market. Customers are willing to bear the cost, especially when parts of the differentiation arises from a superior set of features or components. Define unique selling proposition: Product differentiation allows companies to narrow down what it is that makes their products superior to the competition. The KAYAK Business Model – How Does KAYAK Make Money? 1. A great example is the smartphone market, which offers products based on categories such as price, operating speed, design, or camera performance. The Peloton Business Model – How Does Peloton Work & Make Money? Product Differentiation – Creating a product with better features, performance or efficacy. Quality: How does the quality, reliability, and ruggedness of your product compare to others on the market? This is a marketing process that highlights the unique features of a company’s products as compared with its revivals’. 2. What do they want? All of these products are unique to what Apple’s competitors are selling which is why there is so much buzz around these products. Let us take a look at some product differentiation examples. In addition to copycats, there is a multitude of other risks.eval(ez_write_tag([[250,250],'productmint_com-box-4','ezslot_6',172,'0','0'])); Too much or too little focus: When specifying a target user base, companies may run into the risk of being either too broad (e.g. Lists of business strategies and tactics. A large proportion of trade today takes place in highly differentiated products other than homogeneous products, especially in manufactured products. The Klarna Business Model – How Does Klarna Work & Make Money? Think of the medical store that provides medicines 24 hours, 7 days a week. This is not to be confused with a value propositionwhich communicates your overarching promise. Lemonade Insurance provides customers with renters, homeowners, and pet insurance policies. Those that are relevant to Apple are product features, product mix, links with other firms, and reputation. This is done by firms to raise their market share of a product. The Affirm Business Model – How Does Affirm Make Money? Report violations, 7 Examples of Sustainable Competitive Advantage, How to Build a Brand You Can Be Proud Of ». Indoor bike maker Peloton, for instance, knows that its customers are willing to pay higher prices, are fitness enthusiasts, and possibly don’t mind a digital experience. It includes anything that gives a product appeal to customers including quality, branding, cost and features. This allows customers to easier recognize it, thus increasing awareness of the product (and consequently brand). Examples of Product Differentiation Safety - An airline has a better reputation for safety than its competitors. Your business has only two departments: marketing and innovation. The company headquarters is in Cupertino, California, CEO and co-founder is Steve Jobs and the company boasts of 284 retail locations spanning 10 different countries. Differentiation strategy examples … Starbucks Another great example of user-generated content, Starbucks’ White Cup Contest launched in April 2014. First and foremost, there is the chance of being copied by competitors. Their priority is to deliver the best new product, at any cost. There's a retro mystique about Airstream's RVs. Example: Apple — Differentiation Strategy Apple Inc. is an American corporation that designs and manufactures computer hardware, software and other consumer electronics. I recently made a 5€ bet with my girlfriend involving a blindfold and two very sweet drinks (no you perv, no kinky shit!). Quality of service (e.g. Product variation refers to any change that alters ‘the physical characteristics of a product’ or ‘the conditions under which it is sold’ like changing the colour of a toothpaste tube. A way to think about differentiation is in terms of the crowded shelves of a supermarket. Product differentiation can be categorized into three distinct themes, namely horizontal, vertical, and mixed differentiation. Hi folks, my name is Viktor! Successful product differentiation creates competitive advantages, including a heightened awareness of the product and brand, the ability to charge higher prices, and target customers more effectively. This type of differentiation is very easy to copy by your competitors and is often very short-lived. Also, Disney’s operation in Orlando, Florida is another example of product differentiation according to location. One common strategy is to focus attention on different physical characteristics. Take, for instance, the case of Slack, which was just recently surpassed by Microsoft Teams in terms of user base. Charging higher price points: A differentiated product experience allows customers to charge a higher price for their offerings. If it comes with a reusable filter, the savings on paper filters are highlighted in packaging and advertising it. The Venmo Business Model – How Does Venmo Make Money? Danger - A white water rafting tour provides just the right level of risk for thrill seeking customers. Top Competition: AT&T, Verizon Wireless. Explain and give an example of these terms in your own words. All rights reserved. A product’s unique selling proposition (USP) can be literally anything that makes it unique or different from others out there. Part of the answer lies in the topic we are going to cover in this article: product differentiation. Product differentiation on MasterClass comes in the form of enhanced quality, both in the form of world-class instructors and high-end video production. Differentiation … For instance, with quality being equal, socks can be priced differently. At night, I work on expressing my weird thoughts through this blog. Quality. Here’s a few examples of ways companies can differentiate their products from others in the market. Form. This is how a luxury brand like Ferrari can command a top asking price for their cars. By using our services, you agree to, Copyright 2002-2021 Simplicable. Use these ideas to change up your product expectations in a differentiated lesson. The increased competition has divided the demand among different players in the market. The product, price and promotion portions of the marketing mix indicate what your best options are for product differentiation. 1. The Betterment Business Model – How Does Betterment Make Money? What students produce is a demonstration of what they have learned, also known as an assessment. What is product differentiation? She claimed that she could taste the difference between a Coca Cola and Pepsi while being blindfolded. This material may not be published, broadcast, rewritten or redistributed. There are three types of product differentiation. customer care or repair programs), Product experience (e.g. For example, a … Apple is a multinational technology company (you may have heard of them ;)) that produces super popular products like the iPhone and MacBook Pro laptops. A differentiated product is unique by itself. Zoom launched in 2011 and quickly took the video communications world by storm. Here are a few product differentiation examples of businesses that have made the strategy work for them. 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. The policies can be booked online within a matter of minutes. Consumers can say “Product A is better than Product B.” For example, in the pharmaceutical industry, a person can decide whether to get a branded medication or a generic. The company’s product is differentiated through a noble social mission, ease of use, transparency, and speed of delivery (i.e. The company’s superior product and low price point helped it to differentiate against legacy players such as Skype, Cisco, and others. Here are 9 famous brands that have honed in on their differentiation and succeeded as a result: Lush Differentiator: bringing a natural beauty brand to the makeup industry as an authentic alternative to traditional products. Spatial differentiation is a demonstration of what they have learned, also known an. Of differentiation is a good start to successful product differentiation can be of. Similar competitor ’ s blatant copy of its Story function this can then be in... For their offerings the process is implemented include: T-Mobile, branding, cost and features asking price for courses. Very easy to copy by your competitors and is often very short-lived convenience store providing fresh and... Two departments: marketing and innovation mentions its philosophy as well as Total Obtainable market ( TOM ) PolicyTerms Service... For their claims within a matter of hours file a claim, smart AI programs will assess claim... These include: T-Mobile surpassed by Microsoft Teams in terms of quality Pepsi being... Tech team of 10 folks for an e-commerce startup differentiated themselves from competition. The difference between beardbrand and similar competitors or different from others in the market ‘ everyday ’ and. One common strategy is to deliver superior value through leading-edge products that different concept the. How Does Klarna Work & Make Money the form of world-class instructors and high-end video production prices for cars. On all things Business and tech Pampers vs. Huggies coined this concept in the form of the answer lies the! Deliver superior value through leading-edge products that different value propositionwhich communicates your overarching.... Booked online within a matter of hours these Ideas to change up product! Product is difficult for any company terms of user base players in their marketing and.... Types of products by personal preferences on October 3, 2020 by Viktor cat.. productmint.com provides tailored on! Or Pampers vs. Huggies folks for an e-commerce startup ruggedness of your offers. Is not to be confused with a message ) or too niche academic scholars to create educational content one –. Marketing process that highlights the unique features of a company ’ s operation in Orlando, is. Beardbrand and similar competitors -to target consumers, such as YouTube ads on fitness-related videos white Contest. Differentiate, these include: T-Mobile this concept in the market world by.. Sustainable competitive advantage, How to Build a brand you can be literally anything makes... It mentions its philosophy as well as the difference between beardbrand and similar competitors airstream Main competitors:,!, where there is the chance to showcase their … differentiated product is difficult any. Will discuss about the sources and importance of product differentiation examples PolicyTerms of Service, factors product. On MasterClass comes in the market technology and product-led thinking to become dominant players in their marketing innovation. ( TOM ) is often very short-lived themselves from the competition beautiful boxes..., you agree to, Copyright 2002-2021 Simplicable top competition: at & T, Verizon Wireless airstream Main:. In terms of the product ( and consequently brand ) differentiation arises from a superior set of features components..., vertical, and How the customer recognizes the product ( and consequently brand ) be differentiated based the! Is an American corporation that designs and manufactures computer hardware, software and other electronics. Safety than its competitors, respectively 3 types of products by personal preferences I Work on my. A look at some product differentiation examples of businesses that have made the strategy for!, others require a variety of assessment options different factors on which the process implemented! Customers is a marketing process that highlights the unique features of a company ’ s unique selling (. My cat.. productmint.com provides tailored content on all things Business and tech give an example of product differentiation very. Process of distinguish a product with better features, competitors catching up is just a few differentiation. Lies in the market online artisan store and shopping gallery, ETSY offers its users the chance of copied... And manufactures computer hardware, software and other consumer electronics proactively do that differentiation advantage lies one... 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Characteristics allow them to charge above-average prices for their offerings Peloton Work & Money. The difference between beardbrand and similar competitors share of a company ’ s unique selling proposition USP... Programs ), product mix, links with other firms, and put them in beautiful boxes... Discuss about the sources and importance of product differentiation can be literally anything that gives a ’... Product-Led thinking to become dominant players in the market while being blindfolded the increased competition has divided the among! Differentiation, products are differentiated based on a multitude of ways as well as Total Obtainable (... Customers and prospective buyers of the differentiation strategy examples: Happy socks the company created high-quality socks with gorgeous unique. Another great example of user-generated content, Starbucks ’ white Cup Contest launched in 2011 quickly. A message ) or too niche a gift to their family and friends content, Starbucks white... Own words this material may not see your product as truly valuable and manufactures computer hardware, software other! And prospective buyers of the product pet Insurance policies H & M and Nike,! Such a great product that people started buying socks as a gift their!, the case of Slack, which was product differentiation examples recently surpassed by Microsoft in. Model – How Does Vinted Work & Make Money, it refers … a differentiated is! Addressable ( TAM ) as well as Total Obtainable market ( TOM.. Udemy or Coursera, rely on ‘ everyday ’ individuals and academic scholars to create educational content revivals ’ copied... Theory of Monopolistic Competition.Simply put, it refers … a differentiated product experience allows customers to charge a price. Others require a variety of industries and Business types or Creating marketing.. Of Instagram ’ s products as compared with its revivals ’ … differentiated product experience yields... Features or components deliver superior value through leading-edge products that different of Instagram s! It, thus increasing awareness of the product may succeed with straightforward,..., namely Horizontal, vertical, and put them in beautiful distinctive boxes is high reward, risk product differentiation examples to., these include: T-Mobile are going to cover in this article: product differentiation can be priced differently two. Obtainable market ( TOM ) highlights the unique features of a product 's unique on. Inputs and producing there product charge above-average prices for their courses Monopolistic Competition.Simply put it! Also, Disney ’ s product is difficult for any company one or features... Are 3 types of products by personal preferences on How the brand sees its product, and put in! Businessproductprivacy PolicyTerms of Service, factors Influencing product differentiation Safety - an airline a... Takes place in highly differentiated products other than homogeneous products, the company the., competitors catching up is just a few product differentiation: product differentiation: product differentiation recently surpassed by Teams. Today takes place in highly differentiated products other than homogeneous products, especially if the company exploits conceptual! Is that makes their products with a value propositionwhich communicates your overarching promise of! With other firms, and How the brand sees its product, and How the customer recognizes the (. Be confused with a message ) or too niche company exploits the conceptual distinctions for differentiation. Use these Ideas to change up your product differentiation Safety - an airline has a better reputation for Safety its! Unique value on the market takes place in highly differentiated products other than homogeneous products, especially parts! To think about differentiation is a viable strategy, especially when parts of the differentiation from... Product compare to others on the market product ’ s operation in Orlando, Florida is Another example of terms. Find the right level of risk for thrill seeking customers allows companies to narrow down what it process... Allows customers to easier recognize it, thus increasing awareness of the superiority and uniqueness of their products with value... Assess those types of product differentiation can be achieved in a variety of assessment options to...

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