Product differentiation
In marketing, product differentiation is the modification of a product to make it more attractive to the target market. This involves differentiating it from competitors' products as well as your own product offerings.
The changes are usually minor; they can be merely a change in packaging or also include a change in advertising theme. The physical product need not change, but it could.
The objective of this strategy is to develop a position that potential customers will see as unique. If your target market sees your product as different from the competition's, you will have more flexibility in developing your marketing mix. A successful product differentiation strategy will move your product from competing based primarily on price to competing on non-price factors (such as product characteristics, distribution strategy, or promotional variables).
The disadvantage of this repositioning is that it usually requires large advertising and production expenditures.
See also
- non-price competition
- marketing
- market segment
- product management
- brand
- country of origin
- marketing plan
- mass customization
- positioning