KFC: Differentiation strategy

Many organizations have different strategies to approach the market and survive for as long as they wish. The different strategies are based upon which among the competitive strategies is the best to win over the market. One of the best organizational strategies that a company can use to succeed in the market is differentiation. Differentiation is a common term that is used widely in businesses to become unique and in a way to outdo the competitors in the market in terms of the services offered.

In differentiation, we basically have four types of differentiation strategies in the market namely the vertical, horizontal, mixed, and circular. Vertical differentiation is a type of differentiation which occurs in a certain kind of a market where the variety of goods which are present allow the ordering in accordance with the objective quality starting with the highest to the lowest (Campbell, pg26). In this case, it is allowed to say that there are certain goods from the variety of organizations present which is better than others making the organization have a wide market than others. Basically, the vertical differentiation type can be achieved along a single decisive feature, few features, or across a very large number of features of which each has a presence or an absence.

In vertical differentiation, the potential customers can in most cases have the biased perception of certain features of good mainly because of advertising and the cultural conditions. In most cases, the products in this kind of differentiation strategy are in most cases good products which have a higher value, because of the cost of production which is very expensive and the bigger expected advantages to the customers. Thus the quality-price association is always an upward sloped. Through this kind of mechanism, it is possible to note that the demand curve will be on a downward slope but it can turn in the direction, therefore, having the high sales for the versions having the high prices.

Horizontal differentiation usually occurs when the products are different in accordance with the features which the ordering cannot be in an objective way. This kind of differentiation can be linked to the different colors of the same goods, shapes, styles, and the flavors (Campbell, pg30). For instance, the ice-cream which is offered in different tastes is an example of horizontal differentiation. This, however, does not stop the customers from having their preference since it is always wise to differentiate between whatever which belongs to the supply features and whatever which belong to the customer’s subjectivity.

Mixed differentiation is a type of differentiation where both the horizontal and the vertical differentiation occur. For example, the shoes or garments can have a beautiful rich combination in terms of the shape and the color which might seem as complementary to each other and also be accumulated in the houses of the customers for seasonal specifics (Conklin, pg65). The material quality can be in many cases being seen as vertical differentiation whereas some elements like shape can be horizontal.

Circular differentiation features along that product which is different from the other but can be grouped together. For example, in the hotel industry, it is a closed room which has furniture in it. In this kind of differentiation, the core benefit is what determines how well each can perform compared to other products. 

Considering differentiation in terms of the products there are many advantages to this method for an organization. Product differentiation is one of the best strategies an organization can use to succeed more. Distinguishing between the products is basically very important as this helps in reducing the number of similar products in the market (Campbell, pg50). Competitive advantage in regards to product differentiation is mostly used by the new and smaller organizations in order to attract customers into using their new products rather than buying from the other big companies. Differentiation strategies applied by any organization must be focused on segments in the market and also deliver a certain message that the products are very much better and different from all the other similar products which are in the market.

Advantages of having a product differentiation are that it creates value in the market. If an organization like KFC uses the differentiation strategy to approach the market and in this case focus on the value compared with other products of a similar kind in the market, this creates a certain perceived value to the customers thereby gaining more potential customers who might want to use the products. Any strategy which focuses on the value has an advantage of the costs, the durability of the products compared to the different products available in the market (LAMB, pg209). Another advantage of differentiation of an organization on its products is the non-price competition. Focusing on a differentiation of a product helps the business not only focus on the price but also other competitive areas in the market. For instance, KFC has concentrated in selling fried fast foods with particular spices in all its stores in the world; it may differentiate its products from any other related fast food business in terms of the taste and the quality of the food. Manufacturers of cars can also differentiate the lines of cars and also its symbols while other companies are concentrating on the cost of the cars.

Design and the quality of a product can be an advantage in the small types of businesses thereby gaining the advantage in the competitive world without having to cut its price (Conklin, pg98). Brand loyalty can be of advantage to an organization. Every successful product differentiation strategy will create a brand loyalty to the very customers and this increases the number of customers to the chain stores in the world. A similar strategy to the one that gains the market share through the perceived quality and quantity or the cost savings will also create the loyalty from the customers. The organization has continued with the delivery of quality and value to the consumers in order to maintain and also get products referrals from the same customers (LAMB, pg209). In every market that is competitive, if any product will not maintain the same quality, the consumers might opt for competitors offer.

There are no perceived substitutes if an organization uses this differentiation strategy in the products. Product differentiation method that focuses on the design and the quality of the products produced can create a perception to the customers that there are no substitutes to the products (Conklin, pg76). However, the competitors can also have the same product but the quality and the design of a product can be very much different thereby creating a market customer loyalty in the favor of the organization. This is a way of creating uniqueness in the competitive world of business.   

 

 

 

 

 

 

 

Works cited

Campbell, David. Business Strategy. Palgrave Macmillan, 2011. Internet resource.

Conklin, Wendy. Applying Differentiation Strategies: Teacher's Handbook for Grades K-2.         Huntington Beach: Shell Education, 2010. Internet resource.

Conklin, Wendy. Differentiation Strategies for Science. Huntington Beach, Calif: Shell    Education, 2010. Print.

LAMB, CHARLES W. Mktg Printed Access Card). S.l.: CENGAGE LEARNING CUSTOM P, 2017. Print.