Product differentiation:
Product differentiation is the spirit of monopolistic competition. Product differentiation is the procedure of altering goods which serve the similar purpose therefore, they differ in minor ways.
Product differentiation can be carried around in different ways:
Product differentiation is attempted via
(a) Physical difference; (b) Quality difference; (c) Imaginary difference and (d) Purchase advantage difference. It might be by employing different quality of the raw material and various chemicals and mixtures employed in the product. Difference in durability, workmanship, and strength will too make product differentiation. Product differentiation might also be effected by providing customers some remuneration with the sale of the product. Facilities such as free servicing, acceptance of returned goods, home delivery, and so on would make the customers demand that specific brand of product whenever such facilities are available. Product differentiation via effective advertisement is the other method. This is termed as sales promotion. By often advertising the brand of the product via press, radio, film, and TV, the consumers are made to feel that the brand formed by the firm in question is superior to that of other brands sold by another firms.
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