http://www.brekiri.com/blog/343/competitive-advantage-by-michael-porter-part-4/ Thu, 27 Oct 2011 15:40:00 +0000 hourly 1 http://wordpress.org/?v=3.0.5 http://www.brekiri.com/blog/343/competitive-advantage-by-michael-porter-part-4/comment-page-1/#comment-92 Marco Monfils Mon, 31 May 2010 02:35:42 +0000 http://www.brekiri.com/blog/?p=343#comment-92 Hi Greg, thanks you for the reply, and yes, I understand what you say. I do however see a difference between different and differentiated. <br><br>If something is different (there is no alternative), this should in theory command a premium. <br><br>If something is differentiated, but lacks a credible point of difference, it will not be able to command a premium, at least not from a brand point of view...<br><br>My 1c-<br><br>The practice of differentiation (as the sole RTB) in support of premium price dates from the past. If you cling to this belief, you may find your brand is a legacy, marketing to the past (to consumer who also believes this).<br><br>Differentiation as a marketing tool works best under parity price conditions.<br><br>Thank you for opportunity to reply! Hi Greg, thanks you for the reply, and yes, I understand what you say. I do however see a difference between different and differentiated. If something is different (there is no alternative), this should in theory command a premium. If something is differentiated, but lacks a credible point of difference, it will not be able to command a premium, at least not from a brand point of view…My 1c-The practice of differentiation (as the sole RTB) in support of premium price dates from the past. If you cling to this belief, you may find your brand is a legacy, marketing to the past (to consumer who also believes this).Differentiation as a marketing tool works best under parity price conditions.Thank you for opportunity to reply!

]]> http://www.brekiri.com/blog/343/competitive-advantage-by-michael-porter-part-4/comment-page-1/#comment-89 Greg4 Tue, 18 May 2010 19:51:21 +0000 http://www.brekiri.com/blog/?p=343#comment-89 Thanks for the comments. I'm not sure that I agree that customers are less<br>willing to pay a premium for differentiated products. If anything, I would<br>argue the opposite. There are more and more premium products on the market,<br>everything from the Apple iPad to gourmet chocolate to flat screen<br>televisions. The other thing I try to keep in mind is that a differentiated<br>product might not always be sold at a premium. Products like Facebook are<br>free for consumers and priced at a commodity level for advertisers with the<br>goal of gaining market share based on their differentiation. Thanks for the comments. I'm not sure that I agree that customers are lesswilling to pay a premium for differentiated products. If anything, I wouldargue the opposite. There are more and more premium products on the market,everything from the Apple iPad to gourmet chocolate to flat screentelevisions. The other thing I try to keep in mind is that a differentiatedproduct might not always be sold at a premium. Products like Facebook arefree for consumers and priced at a commodity level for advertisers with thegoal of gaining market share based on their differentiation.

]]> http://www.brekiri.com/blog/343/competitive-advantage-by-michael-porter-part-4/comment-page-1/#comment-88 Marco Monfils Tue, 18 May 2010 17:21:26 +0000 http://www.brekiri.com/blog/?p=343#comment-88 The marketing formulation for a brand looks something like this:<br><br>B = C + AV (if AV > AC), in the eyes of the consumer<br><br>Index:<br>B = brand<br>C = commodity<br>AV = added value<br>AC = added cost<br><br>About differentiation as a marketing tool, <br><br>I believe the biggest challenge is to accept the heyday of product differentiation is over... <br><br>Consumers are less likely to pay premium for differentiated products, simply because they are different...<br><br>About strategy and the trade off between cost and performance, it is not impossible to get both right, at the same time:-) The marketing formulation for a brand looks something like this:B = C + AV (if AV > AC), in the eyes of the consumerIndex:B = brandC = commodityAV = added valueAC = added costAbout differentiation as a marketing tool, I believe the biggest challenge is to accept the heyday of product differentiation is over… Consumers are less likely to pay premium for differentiated products, simply because they are different…About strategy and the trade off between cost and performance, it is not impossible to get both right, at the same time:-)

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