What are the ways in which enterprises can implement differentiated competitive strategies in a monopolistically competitive market structure?

China's market economy is in transition from a shortage economy to a surplus economy. Whether an enterprise can stand firm and grow in market competition depends on whether it has competitive advantages. With the integration of the global economy and China's accession to the WTO, whether the enterprise can stand invincible in the global competition also depends on the availability of competitive advantages. The development and implementation of differentiated competition strategy, to improve the competitiveness of enterprises, win customers, expand market share, improve economic efficiency, and promote enterprise development, has a very important significance.

I. Overview of differentiation strategy

In accordance with the basic competitive strategy model of the famous American management scientist Michael Porter, enterprises in the product market positioning, differentiated competition is one of the basic choices. The so-called differentiated competition strategy generally refers to the enterprise, with its own technological advantages and management advantages, develops and produces innovative products that are superior to the level of existing products in the market in terms of performance, function and quality, and makes the innovative products coincide with the different needs of consumers. In addition, the extension of the concept of differentiated competition should also include product packaging differentiation, marketing means of differentiation, differentiation of advertising methods and after-sales service differentiation and other peripheral work support, the formation of a complete set of differentiated competition system, in order to improve the market reputation of the enterprise and a good image on the basis of all aspects of the enterprise's work around the differentiation of the formation of a virtuous cycle of competition to complement each other system.

Enterprises to implement the differentiation strategy in the following ways:

(1) product differentiation. Refers to the products produced by a particular enterprise, in terms of quality and performance is clearly superior to similar products, thus forming a separate market. For competitors in the same industry, the core value of the product is basically the same, the difference is in the performance and quality, in the case of meeting the basic needs of customers, through continuous innovation, to provide customers with unique products is the differentiation strategy to pursue the goal.

(2) service differentiation. A particular industry, especially the service industry, companies should be for different customers to provide special, personalized, emotional and other characteristics of the service. Creating differentiated services have special significance to consumer preferences, is to win users, expand market share, and stand firm in the fierce market competition is an important strategy.

(3) image differentiation. That is, the enterprise through the implementation of brand strategy and image strategy and the differences. Enterprises through a strong brand awareness, successful image strategy, with the help of media publicity, so that the enterprise in the minds of consumers to establish an excellent image, so as to cultivate customers to recognize the brand purchase habits, the enterprise's brand and image rooted in the minds of customers.

(4) Market differentiation. Market differentiation refers to the product through the sales price, distribution channels, after-sales service in line with the specific market environment conditions and the formation of differences.

Two, the implementation of the differentiation strategy

1. through the customer segmentation to find the right market positioning

Establishing the target market consumer demand is multi-faceted, enterprises must analyze and study the various needs of consumers, accurately grasp the needs of different customers, motivations, differences in purchasing behavior, from the point of view of the consumer market segmentation, and clear differentiation of the basic point of the demand is What, and then by analyzing the conditions required to meet customer differences and their own advantages, clear that the enterprise should be targeted at the consumer objects, and then take production and sales actions, in order to first move the hearts of the consumer objects, and then guide the consumer objects from the "heart" to "action! "and choose the enterprise's products or services.

2. Analysis of competitors

Differentiation strategy is to strive to make their own products or services in the industry is unique, there are one or more qualities, so it is necessary to figure out who is the competitor and the competitor's strengths; Otherwise, it will not be able to formulate a differentiation strategy. To this end, companies must investigate, analyze and study competitors' products or services, their position in the market and their marketing strategies, in order to choose the right one to create their own unique competitive advantage, and to establish a unique position for the company in the minds of consumers.

3. Innovation in technology and corporate culture

Continuous innovation in accordance with market changes is the key to maintaining differentiation and the source of improving the competitiveness of enterprises in the market. An enterprise shows customers not only its products and services, but also attaches more importance to its customers to show the dissemination of corporate culture and service concepts. With the intensification of competition and the pace of economic globalization, the development of technology more and more rapid, enterprises only continue to technology and corporate culture innovation, in order to fundamentally enhance market competitiveness, adapt to the ever-changing competitive environment, to gain a foothold, to become the best in the industry.

4. Focus on customer feedback, test the effect of differentiation, enhance the concept of corporate service

Any competitive strategy must be implemented by the success of the consumer to say. Focusing on consumer feedback is a key point in market competition, and even more so in differentiated competition. This can make the enterprise differentiation strategy to provide products stable, accurate, ruthless cut market demand, always keep pace with market demand, enhance the enterprise's service concept, improve corporate image, enhance brand competitiveness, enhance the enterprise is cohesion, in order to make the enterprise in the market competition will always be invincible.

Three, China's enterprises to implement the differentiation of the obstacles to the existence of competitive strategy

1. The traditional thinking of the bondage still exists in the majority of enterprises

Traditional thinking by the influence of convergence in China's consumer market is very common, we can often see that in a certain period of time, there will be a lot of similar products on the market, the trend of the past most of the products also disappeared. See competing companies because of the sale of a product and quite profitable, for insurance purposes, also followed by the production of the same product, thought that this can avoid the risk of new products do not adapt to the market, unaware of the competitors' products have been branded, in the market to occupy a place, to enter such a market, but to be much more difficult.

2. Most companies lack the awareness and understanding of the importance of differentiation

As the market scale continues to expand, the development of communications technology, the market scope to expand to an unprecedented geographic area, the enterprise and the consumer's contact is also advancing to an unprecedented breadth and depth of the simple product itself has been unable to adapt to the increasingly obvious differentiation of consumer demand and behavior, enterprises should begin to Attention to their own brand differentiation, with differentiation to enrich the brand connotation, to meet the individual needs of consumers.

3. Lack of true technological innovation

Differentiation refers to the part that is better than that of competitors, which can be reflected in the product, service, brand and so on. Among them, the differentiation comes largely from the level of technology. Many Chinese companies lack "real, difficult to imitate" technology. For example, Coca-Cola's beverage formula is its own unique technology, which is difficult for others to imitate. Coca-Cola can use this to produce a different kind of cola and take the road of product differentiation.

4. Low Income Levels Determine Consumption Characteristics in China

Currently, China is still a developing country, and people's incomes are still high enough to buy unique but also expensive products. For example, although domestic home appliances have been dropping in price, spending on home appliances still takes up a large percentage of annual income. As a result, the price elasticity of many products in developed countries is relatively low, and consumers tend to buy higher-priced branded products, whereas in China, where the price elasticity of products is relatively high, price becomes an important indicator for consumers to choose between brands.

5. Weak market positioning link hinders enterprise differentiation

In China, some enterprises have not begun to pay attention to the differences of consumers, and do not realize that their marketing behaviors have different attraction and influence on different consumers, and thus they cannot find out a suitable part of the segmented market according to their own strengths or select a segmented market to transform the products or services. Most of the existing enterprises in China will follow the market trend in order to make profits as soon as possible. For those products that follow the trend, even if the price is low, it is difficult to occupy a sizable market share. Once the market positioning can not be determined, the establishment of the brand and product differentiation will be difficult to achieve success.

6. Inadequate information dissemination leads to differentiated products not accepted by the market

Implementation of differentiation means that the existing brand should be improved, and once this improvement is not recognized by consumers, differentiation will be declared a failure. Consumers are not professionals, it is not possible to fully understand each brand of products, even if the brand is more discerning consumers, they can only choose within the scope of their knowledge; and for the comparison of the information they know after screening, will pick out some of them to make a serious choice; and ultimately will be in them to select two or three for the final choice, until the purchase decision is made. In this step-by-step screening process, each new stage is to further collect more detailed data and information about the product.

Four, China's enterprises to implement differentiation strategy countermeasures

1. Grasp the customer needs, clear market segmentation possible

To "grasp the customer" to accurately grasp the "what do customers need? What is the difference between the needs of customers?" In a sense, creating customers is creating differences. This should be scientific, meticulous market research, market segmentation and market positioning as the basis. When carefully analyzed the existing composition of the market will find that the differences in market demand so that enterprises can be based on the different needs of market groups and market segmentation, to find their own breakthrough point, targeted to meet the requirements of different market groups. This can avoid collision with existing brands in the market in a certain field, and reflect their own characteristics, in the mature market to open up their own piece of heaven.

2. Master the timing of the implementation of the differentiation strategy

No enterprise will not be a brand listed in the period of good planning and rush to market. Therefore, the timing of the success of the differentiation strategy plays a pivotal role. The timing should take into account two factors, one is to be the first to act, and the other is to be a latecomer. The former is a generally recognized practice. In emerging industries, being the first to act enables companies to establish important technology guidelines, strategically pre-value assets, and form customer conversion capital. The positive result of these first movers is to create a sense in the minds of consumers that the products and services of these first movers are somehow more valuable than those of other companies. And as a latecomer, success in differentiation is inevitable once the differentiated product or service has been improved and optimized technologically or otherwise. If the enterprise's technical strength and hardware level are quite strong then consider choosing the first option.

3. Focus on product innovation

To pay attention to innovation, "product is the basis, innovation is the soul". Differentiation strategy is a dynamic process, any difference is not static. With the development of social economy and science and technology, customer needs will also change, yesterday's differentiation will become today's generalization. In the face of changes in customer demand, we can not respond to changes. Any difference will not be maintained permanently, in order to make the enterprise's differentiation strategy to become a long-lasting medicine, the way out is only to continue to innovate, with innovation to adapt to changes in customer needs, with innovation to overcome the opponent's "follow up".

4. Strengthen the management and control of the marketing process

An enterprise in all areas to outperform other rivals is impossible, but in some aspects of the product to form their own customers love the characteristics of the product is entirely commendable. And every defect of competitors' products is our hidden opportunity, the main defect in the field of marketing is that the customer's desire is not fully satisfied, recognize, seize and use this opportunity, which is the differentiation strategy. Enterprise product differentiation strategy is the highest standard of success is whether this differentiation can be recognized by customers. Once the customer recognition, you are the winner of the industry.