Answer to Question #186750 in Management for KAM

Question

Subject: Project planning and control

What are differences between product differentiation and market segmentation? (Please give at least 10 differences)

Answer 1

1. Product differentiation refers to the basic need to have product-related qualities that set the brand apart from the competition. Market segmentation is the breakdown of a large target audience into smaller, more homogenous groups of customers.
2. Product differentiation is a product oriented strategy. Market segmentation is a market oriented strategy.
3. Product differentiation involves promoting an awareness of differences between one company's products and the products of competitors. Market segmentation is concerned with subdividing a market and then forming a suitable marketing mix to reach the target market.
4. Product differentiation focuses on bending of supply to the will of supply. Market segmentation focuses on the development on demand side of the market.
5. Product differentiation shifts or changes the demand curve for market offering of individual or group supplier. Market segmentation adjusts marketing efforts towards consumers.
6. Product differentiation establishes equilibrium in the market by bringing equilibrium in supply and demand. Market segmentation recognizes demand schedules.
7. Product differentiation aims at being unique from the competitors. Market segmentation aims at a particular market.
8. Product differentiation creates value for the product. Market segmentation creates value for consumers.
9. Product differentiation reveals a distinctive product. Market segmentation targets a distinctive demographic.
10. Market segmentation is measurable while product differentiation is immeasurable.