Rahul Vyas

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Kotler defines differentiation as the process
of adding meaningful and valued differences
to distinguish the companys offering from
the competition.
There are a number of differentiation
dimensions and strategies for their
accomplishment.
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A firm can differentiate along 5 dimensions:
Product
Service
Personnel
Channel
Image

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Product line differentiation is an
important marketing strategy.
Differentiation may include
customization, bundling, and
attractive pricing of products.
Sales may rely as heavily on
product packaging and displays.

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Customer service can be enhanced by 24-
hour customer feedback through e-mail and
the ability to respond more rapidly to
customer concerns.
Home delivery of groceries, online banking,
and securities trading are becoming
increasingly popular.
Today such services supplement traditional
services, but may someday replace them.

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The Services allow companies to deliver
products more efficiently.


Low-cost channels
Automated processes
Reduced dependence on personnel
Lower transaction cost
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As an Example : The internet:
Is a location-free, time-free distribution and
communication channel.
Functions as a communication channel for
companies that provide product or service
information online.
Serves as a transaction and distribution channel for
companies that conduct online commercial
transactions.
Becomes the entire distribution channel for digital
products.
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A company can differentiate itself by creating
a unique experience called experience
branding.
Through experience branding firms can
better retain customers, target key
segments, and enhance profitability.
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Trout and Rivkin proposed specific
differentiation strategies common to offline
and online businesses:
Being the first to enter the market.
Owning a product attribute in the mind of the
consumer.
Demonstrating product leadership.
Utilizing an impressive company history or
heritage.
Supporting and demonstrating the differentiating
idea.
Communicating the difference.

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There are various differentiation strategies
unique to online businesses.
Site Environment/Atmospherics
Easy downloads, accurate and clear
information, easy navigation.
Build Trust
Strong brand recognition.
Privacy policy.
Safe and encrypted payment process for
transactions.





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Efficient and Timely Order Processing
Pricing
In the early days of the Web, companies
offered discounts as purchase incentives.
Majority of firms today differentiate
themselves in other ways besides pricing.
Customer Relationship Management
Managing long-term relationships with
customers.
Invite User-generated Content
The key is to trust customers, listen,
respond, and learn.

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The act of designing an
organizations offering and image
so that it occupies a distinct and
valued place in the target
customers mind relative to
competitive offerings.
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1. By attribute or benefit
2. By price and quality
3. By use or application
4. By user
5. By product or service class
6. Against competition
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Toothpaste
Attributes
Market Segments
Children
Teens, Young
Adults
Family Adults
Flavor
Color
Whiteness of teeth
Fresh breath
Decay prevention
Price
Plaque prevention
Stain prevention
Principal Brands Colgate Close Up
Pepsodent
Colgate
Sensodyne
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Necessary when the initial positioning
is no longer competitively sustainable
or profitable, or when better positioning
opportunities arise.
Colgate for sensitive Gums, Mahindra
Passenger Vehicles from Tractors and
Jeeps to X UV , Vedanta Resources
Khushi Campaign .
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1. What position do we want to own?
2. What competitors must be outperformed
if we are to establish the position?
3. Do we have the marketing resources to
occupy and hold the position?
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Making the Positioning Strategy Decision

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Brand Name
Any word, device (design, sound, shape,
or color), or combination of these
used to identify an offering
and set it apart from competing offerings.
Brand Equity
The added value a brand name bestows on a
product or service beyond the functional
benefits provided.
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Develop positive brand awareness and
name-product association (Tata Nano)
Establish a brands meaning in the minds
of consumers (Nike)
Elicit the proper consumer responses to a
brands identity and meaning (Ceat
Tyres)
Create a consumer-brand resonance (
Apple, MicroMax)
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Assign one brand name all of the
organizations offerings (GE, Sony)
OR
Assign one brand name to each line of
offerings (Brittannia )
OR
Assign individual names to each offering
(P&G, Unilever)
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Using a single brand name
Advantage
Easier to introduce new offerings when the brand
name is familiar to buyers
Disadvantage
Can have a negative effect on existing offerings if
a new offering fails
Sub-branding
combining a family brand with a new brand
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Decide whether or not to supply an
intermediary with its own brand name.
What are the costs/revenues?
Is there excess capacity?
If we dont manufacture the brand, will a
competitor produce it?
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Line Extension
Strategy
Brand Extension
Strategy
New Brand Strategy
Fighting/Flanker
Brand Strategy
Existing
products
New
products
New
Brand
Existin
g
Brand
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Adding offerings with the same brand in a product
class that an organization currently serves
Respond to customers desire for variety
Eliminate gaps in the product line
Lowers advertising and promotion costs
Consider possibilities of product cannibalism and
proliferation of offerings (Coke and Diet Coke)
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The practice of using a current brand name to enter a
completely different product class
Reduced risk due to brand equity
Success depends on perceptual fit with the
original product class
e.g., Yamaha makes motorcycles, sound
equipment, computer peripherals, and musical
instruments
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Co-branding
Pairing two brand names of two
manufacturers on a single product
e.g. Wills Life Style ,
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Most challenging strategy
Most costly
e.g. Fortuner by Toyota
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Involves the development of a new brand
and often a new offering for a product
class that has not been previously
served by the organization.
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Flanker Brand Strategy
Involves adding a new brand on the high or low
end of a product line based on a price-quality
continuum (Vilas range by East India Hotels)
Fighting Brand Strategy
Involves adding a new brand whose sole purpose
is to confront competitive brands in a product
class being served by an organization. (Slice,
Maaza etc ).
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