Product differentiation – standing out from the crowd

Businesses operate in competition with each other. If the market is large enough to support many firms, a new business can open which imitates an existing idea. ‘Me too’ products can sometimes be successful.

However, businesses become more competitive by making products that stand out from the competition in terms of price, quality or service. This is called product differentiation.

Methods of creating product differentiation include:

Visually strong products are recognisable by their identifiable designs and use of colour
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