Product Differentiation

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DEFINITION of 'Product Differentiation'

A marketing process that showcases the differences between products. Differentiation looks to make a product more attractive by contrasting its unique qualities with other competing products. Successful product differentiation creates a competitive advantage for the seller, as customers view these products as unique or superior.

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BREAKING DOWN 'Product Differentiation'

Product differentiation can be achieved in many ways. It may be as simple as packaging the goods in a creative way, or as elaborate as incorporating new functional features. Sometimes differentiation does not involve changing the product at all, but creating a new advertising campaign or other sales promotions instead.

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RELATED FAQS
  1. What are some common ways product differentiation is achieved?

    There are many ways to achieve product differentiation, some more common than others. Horizontal Differentiation Horizontal ... Read Full Answer >>
  2. What are the similarities between product differentiation and product positioning?

    Product differentiation and product positioning are important elements in a marketing plan, and most marketing strategies ... Read Full Answer >>
  3. Why is product differentiation important in today's financial climate?

    Product differentiation is essential in today's financial climate. It allows the seller to contrast its own product with ... Read Full Answer >>
  4. Who are Fiat Chrysler Automobiles' (FCAU) main suppliers?

    Fiat Chrysler Automobiles, commonly known as FCAU, designs, manufactures and sells passenger automobiles. It is the world's ... Read Full Answer >>
  5. What is the difference between product differentiation and price discrimination?

    Product differentiation and price discrimination are two strategies used in marketing and economics. Product differentiation ... Read Full Answer >>
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    A monopolistic market is a market structure that has the characteristics of a pure monopoly. A monopoly exists when there ... Read Full Answer >>

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