Definition of product differentiation, strategies and impact on your business
In the business world, product differentiation is very important to do. Because there are many choices of similar competitors which will certainly confuse consumers. Thus consumers are able to decide to choose the product we produce
Therefore, creating something different from competitor products is very important in order to win competition in the business field. Consumers are able to clearly see the distinguishing products among various types of the same product ..
If you often see the product range on display in store storefronts with similar products. Of course it will really confuse consumers. Because, they might not read one by one product description in the store.
Want to know the complete understanding of product differentiation and its functions for overall business development? Read on this article.
Definition of product differentiation
Product differentiation is a differentiator between similar products, both with competitors and with the core products we have. Different does not mean weird. This difference is to make more unique and interesting products, and of course it can meet consumer needs.
There are times when they can win competition in business, need differentiations with existing products or services in addition to promotions, and market segmentation. This is like two interrelated chains. Differentiation makes it easier for promotion and segmentation.
The number of similar products, requires to have a distinguishing in order to attract consumers. Thus, it can increase sales and of course the profit will increase. Therefore, innovation which is part of product differentiation is very important.
As we know other people based on certain features, which distinguish between one person with other people. Likewise with this. Thus, the products produced can be faster and known on the market.
Examples of different products that we use everyday for example are using the instant noodle brand from Indofood. The company has a variety of noodle brands that have market segmentation, such as Indomie, Sarimi, or Supermie
After knowing more about his understanding, then the next thing to do differentiation is to run a strategy. In carrying out this differentiation strategy must understand correctly about the definition. So that it can create the right target strategy.
Strategies that must be done
Conducting product differentiation should not be originated, must do a special strategy so that the product is easily accepted by consumers. Here are some strategies that must be done. So that the product can win market share, namely:
1. Know consumer needs
The first strategy in product differentiation is to know the needs of consumers. Consumers will certainly be cared for by getting the products needed. Excellent service is a part that is included in it. If you cannot do differentiation in the product, the differentiation in service must be prioritized.
Launching products needed by consumers can make consumers change their decisions to buy the product. Thus, the product becomes a differentiator with other products. The thing that distinguishes it is more needed by consumers.
2. Maintain product quality
The quality of products maintained makes these products superior to competitor products or similar products. Of course consumers will choose quality products. This is an advantage and is a differentiation by maintaining product quality.
Quality products, can be produced by using quality raw materials and make changes in some parts of the product. So the product is more attractive. This is one way to make the product superior compared to competitor products.
3. Do product innovation
Innovation carried out is part of differentiation. Thus, the product will become superior compared to competitor products. Therefore, the importance of innovation for the product becomes a differentiator with the others.
The strategy that can be done as a differentiator is to innovate products that are far superior compared to similar products. The superior product is certainly based on innovation. Thus, innovation and differentiation are like two sides of the currency.
4. Honest in the offer
Part of product differentiation is an interesting offer. This can be done in an honest manner in the offer, including expressing advantages and disadvantages of products to consumers, so that consumers get accurate information.
Even though it cannot innovate and revitalize in the product, it can at least do differentiation in the form of service. Thus, consumers will choose the product based on the convenience of the services obtained. Therefore, express product descriptions honestly.
5. Invite consumer perceptions
Perception can be done by promotion, offers as well as an invitation. Thus, the resulting product will be easier to recognize. This is part of a differentiation strategy for the product. Consumers will be invited to use the product.
Changing consumer decisions is quite difficult if you don’t know the strategy. This is part of differentiation, and carrying out promotions that can bind emotional consumers is one way to make purchasing decisions and attract consumer perceptions.
Conducting differentiation on the products produced, of course you have to use a strategy. Thus, the strategy can produce differentiation to increase sales in gaining profits. Therefore some of these strategies can be tried to run.
Strategies in carrying out differentiation are very important. These two things are a whole unit that cannot be separated. Of course the differentiation carried out does not become strange and futile. Thus, the product can increase profits.
In the business scope, differentiation, market segmentation, mastery of market share, profits, sales, is a chain that cannot be separated. If one is broken, the chain cannot function. Likewise with the business chain. The chain can function perfectly, if it perfects the part of the chain.
Effect of Product Destion on Business
The existence of differentiation in the product makes more to influence the development of the business carried out. This will certainly affect the increase in sales and profits. Therefore, for business people are important to do this.
Differentiation will create market segmentation, and of course it is easier to increase sales and carry out marketing strategies. Thus, this is a whole chain in the scope of the business.
When talking about influence, it will talk about the flow of differentiation. The flow is differentiation, then market segmentation, increase in sales, and also mastery of market share to further increase sales and profits. Indirectly will have implications for profits.
Every business actor will certainly be oriented to profit. Therefore, all strategies will be made to obtain this profit. One of them by conducting differentiation as business experts revealed to win the competition.
Advantage orientation has become a target in business. Orientation of profit and differentiation is correlated even though it is not directly. Differentiation is like a bait to attract consumers to buy products produced. Thus, it will indirectly bring profits.
As part of the chain, product differentiation plays a crucial role in business development. Like the chain, if one is disconnected, it cannot run a business in a single unit.
The influence of differentiation on business development is quite significant. Business can increase rapidly because it can easily control the market share. This is part of the business strategy management, as quoted by business experts.
In developing or differentiation of products or services requires a good budgeting so that all plans run optimally. This forces us to manage business finances that are structured, systematic and in accordance with the realization of our business planning in the future.
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