Differentiation that matters

Patrick Barwise
Management and Marketing at London Business School
Sean Meehan
Marketing and Change Management at IMD, Lausanne

Marketing is about two things. First, the marketing concept: 'Marketing is not a specialised business activity. It is the whole enterprise seen from the customer's point of view.'1 Firms make money by profitably meeting customers' needs better than the competition. Second, differentiation: marketing's role is to increase the brand's distinctiveness in customers' minds, countering the commoditising pressure of competition. Firms make money by being seen to be different.

Many marketers have lost sight of the first and misunderstood the second. Obsessed with being different from the competition, they focus on trivial unique features and gimmicks, leading to widespread customer dissatisfaction.