Parity Products - Meaning & Definition

Published by MBA Skool Team, Last Updated: October 30, 2014

What is Parity Products?

Parity products fall in the category of products where several brands offer products which are similar to each other & possess functionally same attributes. This makes one brand easily substitute by some other brand.

The presence of parity products in a category means that a consumer has more than one option to choose from & thus there is very less chances of a monopoly. A firm making parity product cannot command premium pricing because of the presence of competitor’s products which can easily substitute their offering. If a firm raises its prices, the consumers will buy less of that brand & will switch to the other brand as both the brand provide almost similar offering.

The advertisements are important aspects of parity products through which one tries to differentiate their product. The products following in this category are mostly the products that you use in Kitchen or Bathroom. For example Toothpastes, shampoos, soaps, detergents etc have variety of parity products as each brand in these product categories are essentially similar & offer identical benefits.


This article has been researched & authored by the Business Concepts Team. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.

Browse the definition and meaning of more similar terms. The Management Dictionary covers over 2000 business concepts from 5 categories.

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