What is Differentiation?
One of the most important ways to have customers recognize the value of your product is through differentiation. Differentiation is the process of clearly showing how your product is superior compared to similar products from competitors. There are several methods of differentiation, but the easiest approach is lowering the price. This strategy appeals to price-sensitive consumers by setting a lower selling price than competitors without making any changes to the product itself.
However, price differentiation can lead to price wars, creating a situation where it becomes difficult to maintain profitability. For this reason, it is preferable to differentiate through factors other than price, if possible.
Next is “differentiation through functionality,” which is a strategy that enhances competitiveness by offering unique features not found in competitors’ products. However, these features need to be perceived as valuable by consumers. No matter how many additional features you offer, they will not increase competitiveness if consumers don’t see them as valuable.
So far, we’ve discussed price and functionality as methods of differentiation, but these are only basic approaches. The most crucial differentiation is “marketing-based differentiation.” Beyond price and performance, the true differentiating factor is how well-known your product is. Products that sell well aren’t always superior in terms of features or price. Typically, high-selling products are those that are heavily advertised.
Nowadays, advertising methods aren’t limited to paid advertisements. Utilizing social media and video platforms to raise awareness of your product is also a form of differentiation. The ultimate goal of differentiation is to sell more products. While improving product quality is fundamental, what’s even more important is how many people know about your product. Spending money on advertising can easily increase brand awareness, but in today’s world, true differentiation lies in how you can use the internet to raise awareness among a large audience at a low cost.
Kenichi Uchikura
President / CEO
Pacific Software Publishing, Inc.
ken.uchikura@pspinc.com
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ABOUT PSPINC
PSPINC (Pacific Software Publishing, Inc.) is a technology company based in Bellevue, Washington, USA. Founded in 1987, PSPINC provides web hosting, email hosting, and other internet-related services to businesses and individuals worldwide.
In addition to its hosting services, PSPINC also offers website design and development, domain registration, and online marketing services. The company has data centers located in the United States and Japan, and it offers multilingual support to its customers.
PSPINC has a strong focus on customer service, and it has received numerous awards and accolades for its quality of service over the years. The company is committed to staying up-to-date with the latest technology and industry trends in order to provide the best possible solutions for its customers.
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