Definition: Differentiation is one of the 3 generic strategies that can provide a competitive advantage according to Michael Porter.
In a D strategy, a firm seeks to be unique in its industry along some dimensions that are widely appreciated by buyers.
A differentiator can not ignore its cost position. In all areas that do not affect its D it should try to decrease cost; in the D area the costs should at least be lower than the price premium it receives from the buyers.


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More on competition: Competition Levels, Competitive Advantage, Competitive Intelligence, Cost Leadership, Curveball Strategy, more...

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