Product Differentiation Strategy – What You Need to Know

This is a little bit of an irritating subject to actually approach for a few reasons. I’ll get into that in a little bit. Before that, I do want to point out that product differentiation strategy is incredibly important in multiple contexts.

It’s these multiple concepts which are one of the biggest annoyances in actually discussing this concept. See, it does have a few different contexts. It means the same basic thing, it’s all about what you’re differentiating from?

Is your product differentiation strategy about making different products in your own repertoire, or similar products from competitors in the market? Both are significantly important, one being a little more stressful and critical than the other, obviously.

But, since they’re similar concerns with very different factors and ramifications, it’s a real problem to try to cover all of this.

Well, I can’t, so today, we’ll focus on differentiation with competitors.

The Base Problem for your Product Differentiation Strategy:

It’s so dangerously easy to let yourself get into a very limited mindset with competition. This mindset very much focuses on aggressive marketing, smear campaigns and price wars. Often, claims of quality differences are subjective or trumped up in their veracity.

Well, aside from the ethics of these campaigns … people are hip to this now, and it’ll continue to lose its effectiveness at an exponential rate in the information age. This kind of pseudo-political strategy is a relic of the analog era.

The Real Killer:

Here’s where your real power is going to come from.

Remember the academic and marketing rule of publish or perish. Well this is where your biggest differentiation can be fully realized and demonstrated. White papers, case studies and point for point exploration and exposition of the product show where its strength lie and makes people whom it would best suit, aware of the need for your product versus other alternatives.

Along with this kind of publication are legitimate cost and quality comparisons with other competing products, which demonstrate an affinity for a price bracket, demographic or depth of need.


Ok, this is the part I don’t really like talking about, because it’s easy to sound pretentious when you get into art and user experience, it’s not really my field, and it’s a soft science. But, it does overlap into our field, so we need to grasp UX a bit, and branding etc.

Let’s look at two titans competing in the same niche somewhat equally powerfully. Coca-Cola and PepsiCo are the two biggest producers of soft drinks in the world, and their flagship products are colas aptly named for the companies. The mentality of “Coke drinker or Pepsi drinker” is a symptom of very effective differentiation.

So, aesthetic, an identity and attitude that closely bonds to a specific set of demographics in a polarizing way like this actually does work. But, there’s no rule of thumb for how to effectively brand and build such a product and corporate identity. If there were, things would probably be boring.

So, there’s just not a very solid set of guidelines for a product differentiation strategy, and when it all comes down to it, all any of us can do us know our demographics, understand the new publication revolution, and learn from companies that got this right.


Mark is the Lead Author & Editor of Spectechular Blog. Mark established the Spectechular blog to create a source for news and discussion about some of the issues, challenges, news, and ideas relating to Product Management.