Product Differentiation as a Survival Strategy in a Competitive Marketing Environment
Product Differentiation as a Survival Strategy in a Competitive Marketing Environment
Abstract of Product Differentiation as a Survival Strategy in a Competitive Marketing Environment
The history of marketing revolves around customers or consumer. This denotes that the major reasons why products are produced are because of the consumers who made the production process effective and efficient. Product differentiation is used to separate the choice, test, want needs of the consumers so it become so important that the segmenting differentiating product for easy identification becomes the paramount need in the cosmetic industry. Product differentiation has being found effective in the marketing world/environment because it increase the sale of the product and provide consumers with the required satisfaction they needed. Therefore companies should use the rightful means of communication to ensure that the rightful strategy in differentiating product will be adopted so as to satisfy the yarning of the consumers. Through the process of differentiating product consumers problem will be solved, and the rightful target and objectives including the goal of the company will be achieved and customer’s satisfaction will be attained.
Chapter One of Product Differentiation as a Survival Strategy in a Competitive Marketing Environment
INTRODUCTION
Product differentiation is a strategy and a survival tool for effective penetration in every competitive marketing environment, considering the fact, that product is the main thing that keeps every production company going in every business environment, product has being viewed as the major projector of every companies capacity and capability mostly production companies, so how the product determines how it will survive the competitive environment.
The aim of this chapter will be summarized into three points as thus
First, to define those marketing terms this will be used throughout this research work.
Secondly, to look into the impact of product differentiation as a survival strategy in starline Nigeria limited.
Thirdly, to take a deep look at market segmentation and also to specifically state the fact that the market is heterogeneous.
BACKGROUND OF STUDY
The market as some marketers used to think of it, is not a group of homogenous buyers but a group of heterogeneous buyer whose different attitude is in one product for example some women apply cosmetics to draw alteration to themselves while others apply to beautify themselves so the company will tailor her product appeal to satisfy the needs of the fact that the market is always heterogeneous led to the concept of “market segmentation”.
Market segmentation is an establishment and acknowledged techniques for dividing a mass market into identifiable sub-units in order that the individual needs if buyers and potential buyer can be easily satisfied.
It seeks to establish particular group or cluster of buyers.
Market may be served with two different products, which are product standardization and product differentiation. Product standardization is the decision to sell the same type of product to the whole market without considering the heterogeneous nature of the whole market (consumers) of the product. In nutshell product standardization is an efficient method to reduce cost and increase quality by minimizing the differences in your products, you are able to rapidly increase production, streamline distribution, decrease raw material cost and reinforce product branding.
This could be achieve through standardizing the basic component, standardizing the packaging of the product quality
It is the use of one product and four mix for all market segment no attend is made to cultivate various segment of the market place. Product differentiation is the decision to produce two or more types of the same product but differentiate in terms of stage, features, quality, size, price packaging so as to offer variety to the market and distinguish seller products from competitors product. it also take in consideration the heterogeneous nature of the market. Product differentiation allows the firm to promote it product as different in quality than other competing ones and this becomes the edge, which the firm has rather gain than pries product differentiation is seen as that which treat each consumer uniquely as reflected by above definition, product differentiation and standardization are tools of market segmentation.
market segmentation itself can be explained as the identification and dividing a marketing into meaningful groups to buyers who might need separate product an organization that decides to produce goods like cosmetics must recognize that they can neither serve nor appeal to the total market with one product or one marketing mix the idea is born out of the fact that the buyers to numerous, widely spread and different in their purchase behaviour however, this study will research into how effective, efficient product differentiation is employed as a survival strategy in the competitive marketing environment of cosmetic product, how it helps the profitability of the company. Its impact on the market share of the company.
All these with particular reference to starline Nigeria Limited Aba. The company started as a simple proprietorship in mid metamorphosed into starline Nigeria limited. In 1962 founded by Chief (Dr) Peter S. Owuma (Late). Starline Nigeria limited is a market leader in the manufacturing of cosmetics in Nigeria. Over twenty (20) products ranging from, Erato range, ultimate Elope range hair product range, petrosa range, identical range hair product range and so many others are currently in the market and highly differentiated to serve the whole segment of the market and highly basically.
Example, Erato Lotions identified as Erato skin Lintner for fair complexion in order to cover the market segment.
STATEMENT OF PROBLEM
Business fail these days because those responsible for formulating strategies objectives lack the for-sight in identifying the various psychological needs, and differences existing in those markets the company is serving.
Once a product is doing well in the market, the decision markets will assume that they are making 100% profit while having 100% success market opportunity available to them.
Also, due to heavy cost involved in a distinct product from existing once, there is always a problem of additional cost when a firm wants to go into product differentiation.
For any business to succeed, it must have in-depth knowledge of the market it is serving and must be able to move strategies to satisfy the consumer of her product. Among the many strategies that can be used are: After sales services, discount, product modification and product differentiation.
The research work is aimed at suggesting way, a company will lower the cost that scars firms away form product differentiation so as to compete favourably with other products.
OBJECTIVES OF STUDY
The main purpose of this research is to look into the impact of product differentiation as a survival strategy in Star-line Nigeria limited, the purpose of this study include:
a.Examination of the product differentiation on the competitive trend of Star-line Nigeria ltd.
b.To determine the impact of product differentiation on the profitability of Star-line Nigeria Ltd.
c.To determine the role of product differentiation strategies in Star-line Nigeria Ltd.
d.To identify the problems of differentiation strategies in Star-line Ltd.
To recommend the best approach in applying product differentiation.