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Market Differentiation - Meaning & Definition

Published by MBA Skool Team in Marketing and Strategy Terms Last Updated: September 13, 2023Read time:

What is Market Differentiation?

A promotional strategy employed to create a particularly strong hold in a specific market. While adopting market differentiation method, a firm would produce several variations of the basic product which will be marketed in different sections of the market under the same umbrella brand, which provides the parent brand a wide range of coverage and thus helps in creating a sense of dominance across the various segments of the market.

It helps the brand to acquire a large mind share amongst the prospective and current consumers due to its presence in as many categories as possible. With the technology reaching masses and rise in disposable income, there is a market demand of various version of the product so that the different needs of different type of consumers is satiated. Every market and its corresponding customers are important. Let us understand this concept with the help of an example –

Mobile phones are a part of nearly everyone’s daily life. Although it is a recent invention but still, it is hard to imagine our life without it. Different type of consumers need different type of phones and firms provide products which satisfies those needs. Samsung is the leading mobile phone company in the world with the strongest presence in that market. It adopted the strategy of market differentiation and provided products that serve different types of consumers and their needs. The different types of products are – Feature phones (For Ex – Guru), Touch screen (Non Smart phones) (For Ex- Rex), Low end Smart phones (For Ex – Ace), Mid-Range Smart Phones (For Ex – Galaxy S Duos) and High End Smart phones (For Ex – Galaxy S Series latest versions) and Phablets (Note series latest versions).


Hence, this concludes the definition of Market Differentiation along with its overview.

This article has been researched & authored by the Business Concepts Team which comprises of MBA students, management professionals, and industry experts. It has been reviewed & published by the MBA Skool Team. The content on MBA Skool has been created for educational & academic purpose only.

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