HOW CAN A COMPANY GAIN COMPETITIVE ADVANTAGE THROUGH DIFFERENTIATION?

DESCRIBE
AN EXAMPLE OF A COMPANY THAT ILLUSTRATES EACH TYPE OF DIFFERENTIATION DISCUSSED IN
THE CHAPTER.

- Definition of competitive advantage: a condition/ circumstance that a

company has a superior/ more favorable attraction from the customers.
They can sell more products in the market than others.
- A company can gain competitive advantage through differentiation by
extending the customer value by either changing the price of a specific
product or offering greater value for their customers. Differentiation is
created when a company change the path of marketing and selling the
products in which the customers can feel the sense of willing to buy the
products with a premium price.
- One company can apply differentiation by unique strategies to gain the
competitive advantage, which includes:
 product differentiation: to customize and upgrade the value of the
product with special functions/ design/ inner elements,… (in a unique
way)
Example: Coca-Cola divided their beverages into different types (0% calories,
fruit juice, water, etc…) that let customers have a variety of choices, while
other beverages companies only have one/two types of beverages. This let
Coca-cola attracts the attention from a wide range of customers and gain
effective competitive advantage.
 price differentiation: sell the product with a lower price with the
same quality as other competitors/ in a way that customers are
willing to buy.
Example: Denmark electronic company sell cheaper devices than pther
companies but with the same quality
 service differentiation: having special treatment for customers during
the process of buying the products/ offer post-purchase product
support.
Example: Apple’s warranty policy is longer other cellphone/ electronic
companies/brands.