Product Differentiation: A Catalyst in the Customer’s Purchase Decision-Making Process

Apr 7, 2021 | Uncategorized

A product is nothing but a total package of benefits that solve customers’ problems or meets their needs. Selling products on Amazon is now becoming more complex and competitive than ever in the past. Market Analysis is a common practice termed as Product Research among the Amazon Seller community. Still, many sellers fail to understand product differentiation – a fundamental concept of dedicated product research – and launch their products without a solid foundation.

Product differentiation is the introduction of distinctive characteristics or features to a product. It enables a brand to achieve a competitive advantage over other brands offering similar product substitutes. It plays a vital economic significance to a business and ensures a unique selling proposition (USP) of the product.

We, the Liazon Marketing Product Research Team, conduct our extensive research in two parts:

1. Market Analysis, and

2. Product Differentiation Analysis

Our Product Differentiation Analysis aims to cover two important aspects:

  1. Vertical Differentiation, which involves differentiating product based on quality and use the trait as a competitive advantage to sell the product
  2. Horizontal Differentiation aims to differentiate specific features (e.g., colors, shapes, flavors, etc.) to fulfill customers’ desires and ensure quality.

The objectives of Product Differentiation Analysis are:

  1. To provide sellers with a competitive advantage to achieve significant market share
  2. To boost sales by a considerable margin by introducing one or more distinct features in the product that will make it better than its substitutes
  3. To help achieve a higher price point by introducing additional benefits or parts in the product
  4. To promote brand loyalty