Product differentiation is the process businesses use to make their products stand out from those of their competitors. By highlighting unique features, quality, branding, or customer service, firms can add value to the product to appeal to customer needs or preferences.
In GCSE Business, understanding product differentiation helps students grasp how firms can gain a competitive edge, attract customer loyalty, and justify higher pricing. The ultimate goal of product differentiation is to create a perceived value that sets a business apart in the marketplace.
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