Differentiation is the process of truly distinguishing a company’s market offering from those of its competitors, with the goal of creating greater value for the customer. It is an active act of positioning that seeks to make the offering unique and preferred in the minds of the target audience.
Differentiation can be achieved in terms of product (through design, features, or quality), service (through speed, reliability, or installation), channel (through coverage or expertise of intermediaries), or people and image (through branding and reputation). Successful differentiation allows a company to command a price premium and build a sustainable competitive advantage.
