Differentiation Management in Business

Using differentiation in business can be an effective way to win the competition. Creating a unique product or offering can help you to increase profits, while still maintaining a competitive edge. But there are many different types of differentiation strategies. Developing a solid one can be a challenge. Here are a few things to consider.


One of the most common forms of differentiation is product differentiation. This involves a product's actual differences from its competition, such as durability, quality, and price. The key is in determining the most effective ways to differentiate your product. Some companies even create a list of characteristics that differentiate their products from their competitors. It is important to take advantage of opportunities to differentiate your product in all production areas.

In contrast, the most effective way to differentiate your product is to create a unique product that fits the needs of your target market. For example, you may want to offer a more comprehensive customer service experience than your competitors. Alternatively, you may want to offer more availability for your customers.

Another type of product differentiation is reputational. You can create a positive brand image that associates your product with social justice or something similar. This may not be an exact science, but it can be effective in some cases. The Dove Campaign for Real Beauty is a good example of how you can use reputational differentiation to create an emotional link between your brand and your customers.

Using differentiation in business can also extend to the channels through which you distribute your products. This is an important consideration because your competitors may be able to duplicate the benefits of your differentiation strategy. It is also important to understand the impact of your differentiators, and how they will affect your bottom line.

One of the most important aspects of a differentiation strategy is the research you do. You may want to ask your customers about their product or service preferences. This will help you to create a list of features and benefits that will set your product apart from the competition.

Another important part of a differentiation strategy is analyzing your sales data. You can also test your strategy by asking customers or friends for feedback. This can be done with focus groups or surveys. The key is to understand the interactions between your differentiators and your target audience.

The best part about a good differentiation strategy is that you don't have to go through the hassle of price competition. You can use your own product to set yourself apart from your competition, and you can increase profits without lowering prices. But you must be careful. Using a product to differentiate your business from the competition will not be easy. Some companies will do this by underbidding work. Others will do it by creating an over-branded product or offering inferior customer service.

A successful differentiation strategy is all about analyzing your sales data, implementing a solid plan and monitoring the results. The more research you do, the more accurate your results will be.