Question

Discussion 2 Give examples of the role of product differentiation and competition in small businesses.

Answer 1

Product differentiation refers to the marketing practice used to emphasize the distinctive attributes and advantages of a product or service to distinguish it from the rivals. Via their ads and promotions, the marketing department expresses those special qualities. And the sales department will use these to show the competitive benefit of the company.

Product differentiation, also known as a differentiation technique, is a way for businesses to make their goods stand out and attract customer interest. This allows the firm to establish a powerful brand recognized by potential customers. And it raises the probability of your product being chosen over a generic or non-differentiated product

A person need not travel to places to witness examples of differentiation between products. Label distinction can be seen in grocery stores, TV advertisements, and also when choosing Facebook over Google+. Choosing an iPhone over an Android as the customer sees iPhone as a status symbol, and believes it has an easier interface than Android. As the consumer chooses a Swiss watchmaker, preferring a Tag Heuer watch over Titan. He additionally claims Tag Heuer is a better brand than Titan.

The competitive environment is filled with the direct competitors in a healthy market economy. Those include whoever is in the same company. Any company that sells the same goods and services is in direct competition within an industry. For instance, whoever sells electronics is a direct competitor with other electronics sellers. Both marketing consultancy companies are in direct competition.

Indirect rivals are those that are not necessarily the same form of company but who are vying for the same dollar as customers. While this is not a prerequisite, they can belong to the same industry. That causes the competitive landscape indirect is that the firms sell a particular product or service. In the entertainment industry , for example, a satellite television channel competes with ticket sellers for a sporting venue or concert for the entertainment dollar. A fast food restaurant and a buffet restaurant are in indirect competition.