What is differentiation and how does it work?
Sharp and Dawes review how differentiation relates to profitability and challenge the belief that it must earn a higher price. They define differentiation as a brand outperforming rivals on one or more features so that customers are less sensitive to its other features, which lets the firm skip providing those features, makes competition less direct and lets it capture a larger share of the value created in an exchange. They observe the pattern widely in modern markets but see it as stemming mainly from differences in distribution and awareness and occasionally design, with brand-level differentiation on functional features less common because competitors match them. Journal of Marketing Management 17(7-8), 2001; authors Byron M. Sharp and John G. Dawes.
Sharp and Dawes review how differentiation relates to profitability and challenge the belief that it must earn a higher price. They define differentiation as a brand outperforming rivals on one or more features so that customers are less sensitive to its other features, which lets the firm skip providing those features, makes competition less direct and lets it capture a larger share of the value created in an exchange. They observe the pattern widely in modern markets but see it as stemming mainly from differences in distribution and awareness and occasionally design, with brand-level differentiation on functional features less common because competitors match them. Journal of Marketing Management 17(7-8), 2001; authors Byron M. Sharp and John G. Dawes.
Written from the abstract from the OpenAlex record (search), 2026-11-03; full text not read.
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Sharp, B., & Dawes, J. (2001). What is differentiation and how does it work? Journal of Marketing Management, 17(7-8). doi:10.1362/026725701323366809 https://doi.org/10.1362/026725701323366809