PRODUCT DIFFERENTIATION AS A SURVIVAL STRATEGY IN A COMPETITIVE MARKETING ENVIRONMENT
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PRODUCT DIFFERENTIATION AS A SURVIVAL STRATEGY IN A COMPETITIVE MARKETING ENVIRONMENT
ABSTRACT
The history of marketing revolves around clients, or consumers. This means that the primary motive for product production is due to consumers, who have made the manufacturing process productive and efficient. Product differentiation is utilised to separate consumers’ choices, tests, and wants, making segmenting distinguishing products for easy identification a critical demand in the cosmetic sector.
Product differentiation has been shown to be effective in the marketing world/environment since it increases product sales while also providing consumers with the necessary satisfaction.
As a result, enterprises should employ the appropriate means of communication to guarantee that the appropriate strategy for differentiating products is implemented in order to satisfy consumer demand.
The process of differentiating products will solve consumers’ problems, reach the proper goals and objectives, including the company’s goal, and ensure customer pleasure.
Chapter one
1.0 INTRODUCTION
Product differentiation is a strategy and survival tool for effective penetration in any competitive marketing environment. Given that the product is the main thing that keeps every production company going in any business environment,
the product has been viewed as the major projector of every company’s capacity and capability, particularly for production companies, so how the product is designed determines how it will survive the competitive environment.
The purpose of this chapter will be summarised in three points as follows:
First, define the marketing phrases that will be used throughout this investigation.
Second, to investigate the impact of product differentiation as a survival strategy for Starline Nigeria Limited.
Third, to examine market segmentation in depth while simultaneously emphasising the market’s heterogeneous nature.
1.1 Background of Study
The market, as some marketers used to think of it, is not a group of homogeneous buyers, but a group of heterogeneous buyers whose different attitudes are in one product. For example, some women use cosmetics to draw attention to themselves,
while others use it 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 established and recognised approach for breaking a large market into recognisable sub-units so that specific demands of consumers and potential customers can be readily met.
It aims to develop a specific group or cluster of purchasers.
The market may be supplied with two distinct products: product standardisation and product differentiation. goods standardisation is the decision to sell the same sort of goods to the entire market without taking into account the product’s heterogeneous target market (consumers).
In a word, product standardisation is an effective way to cut costs while increasing quality. By minimising product variances, you may quickly boost production, streamline distribution, lower raw material costs, and enhance product branding.
This could be accomplished by standardising the basic component and the packaging of the product quality.
It is the utilisation of one product and four mixes for all market segments, with no attention paid to cultivating different market segments. Product differentiation is the decision to develop two or more versions of the same product that varies in terms of stage, features, quality, size, price, and packaging in order to provide market variety and distinguish seller items from competitors’ products.
It also considers the market’s varied nature. Product differentiation lets the firm to present its product as different in quality than other competitive ones, and thus becomes the edge, which the firm would rather gain than pry.
Product differentiation is defined as treating each consumer distinctively, as shown above. Product differentiation and standardisation are market segmentation tools.
Market segmentation can be defined as the identification and division of a marketing into meaningful groups to buyers who may require separate products. An organisation that decides to produce goods like cosmetics must recognise that they cannot serve or appeal to the total market with one product or one marketing mix.
The idea stems from the fact that buyers are numerous, widely dispersed, and diverse in their purchasing habits; however, this study will investigate how effective,
efficient product differentiation is used as a survival strategy in the competitive marketing environment of cosmetic products, as well as how it contributes to the company’s profitability. It affects the company’s market share.
All of this is with particular regard to Starline Nigeria Limited Aba. The company began as a modest proprietorship and then evolved into Starline Nigeria Limited. Founded in 1962 by Chief (Dr) Peter S. Owuma (Late).
Starline Nigeria Limited is the market leader in cosmetics manufacture in Nigeria. Over twenty (20) goods, including the Erato range, the Ultimate Elope range of hair products,
the Petrosa range, the Identical line of hair products, and many others, are currently available in the market and are highly differentiated to service the entire market segment.
Erato Lotions, for example, were renamed Erato Skin Lintner for fair complexion to better serve the market sector.
1.2Statement of Problem
Businesses fail these days because those in charge of developing plans and objectives lack the foresight to understand the many psychological demands and disparities that exist in the markets the firm serves.
When a product performs well in the market, decision makers will assume that they are making 100% profit and have 100% success market opportunity available.
Furthermore, because of the high cost involved in creating a new product from an old one, there is always the issue of added expense when a company wants to differentiate its products.
To flourish, any firm must have a thorough understanding of the market it serves and be able to implement methods to please the customer of its product. There are numerous tactics that can be implemented, including after-sales services, discounts, product customisation, and product differentiation.
The research aims to offer ways in which a company might reduce the costs that discourage enterprises from pursuing product differentiation in order to compete favourably with other products.
1.3 Study Objectives
The primary goal of this research is to investigate the influence of product differentiation as a survival strategy in Star-line Nigeria Limited. The objectives of this study include:
a. An examination of Star-line Nigeria Limited’s product difference in relation to its competitive trend.
b. To assess the influence of product differentiation on the profitability of Star-line Nigeria Ltd.
c. To assess the impact of product differentiation initiatives at Star-line Nigeria Ltd.
d. Identify the flaws with Star-line Ltd’s differentiating initiatives.
To recommend the best method for adopting product differentiation.
1.4 RESEARCH QUESTION
The following study questions are designed to help the researcher assess the value of product differentiation as a survival strategy in the marketing of Star-line cosmetics.
a.Is product differentiation employed at Star-line Nigeria Ltd.?
b.What are the criteria for differentiating a product?
c.Has product differentiation had a major impact on Star-Line Nigeria Ltd’s market share?
d.Does product differentiation have an impact on Star-line Nigeria Ltd’s market share?
e.How does product differentiation affect the earnings of Star-line Nigeria Ltd?
1.5Statement of Hypothesis
Ho: Product differentiation has no major effect on the market share of cosmetic products.
Ho2 product dedifferentiation increases sales of cosmetics products.
1.6 SIGNIFICANCE OF THE STUDY
Any company generating a highly competitive product must differentiate its product(s) from those of its competitors while also being able to respond effectively to market problems.
On competition, this research work would have shed enough light on the prospects of product differentiation as a survival strategy. This would be useful not only to students,
but also to business owners, particularly small business owners, who will learn that it pays to differentiate one’s product because this policy will help increase sales volume, market share, and profit.
The government will also gain from the results of this research because increased profits for the corporation will boost the national economy, which will be a credit to the government.
1.7 Scope of the Study
Because of the limited time available for this research and the necessity to provide a credible and meaningful result, the focus is on a single organisation: Starline Nigeria Limited Aba, Abia state. The researcher is limited in the sources of materials for this work; the research is asked to attend lectures and prepare term papers.
1.8 Limitations of the Study
This research project, which deals with manufacturing differentiation as a survival strategy in a competitive marketing environment–Starline Nigeria Limited–was greatly impacted by numerous constraints.
The main issue I encountered was the company’s staff’s unwillingness to cooperate, which made it difficult for me to obtain the data needed to make my findings and lost a significant amount of time during the research process.
Also, finance was an impediment during the course of this study; the cost of transit for the number of days this task was carried out became a concern for me.
The time aspect was also important, as there was enough time to conduct the research.
1.9 Definition of Terms
Some terminology must be established in project writing to complete the work and avoid any misconceptions or interpretations that may develop.
· MARKET MIX: The four primary elements in marketing are products, place price, and promotion, which serve as pillars to make marketing successful. Also known as 4Ps and marketing elements.
· PRODUCT DIFFERENTIATION: Management decides to develop different versions of the same product with varied styles, quality, packaging, sizes, and colours.
· STRATEGY: Marketing practitioners create effective plans to outperform competitors in the market.
· PRODUCT STANDARDISATION: This market segmentation tool ensures that all products meet the same standards for the whole market.
· Marketing is the process of finding, predicting, and satisfying client needs profitably.
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