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Services Marketing
Notes 7.4 Undifferentiated Marketing vs. Differentiated Marketing
7.4.1 Undifferentiated Marketing
This implied that the organisation had only one product and it aimed the product at the whole
market. It expected the customers to take it or leave it, since there was hardly any choice in the
offer. It never bothered with individual tastes and it manufactured one product for the whole
market.
The advantage of this method was that it introduced the concept of mass marketing. A lot of cost
was cut in terms of having low inventory, fewer models and there was an economy of scale in
the manufacturing process. Cost was reduced successfully. Communication was also not very
complicated and mass media was used. The customers looked for their basic, core need to be
satisfied.
Did u know? Henry Ford could get away with make the famous statement, I am willing to
sell a car in any colour provided it is black; regarding his model T which after 20 years
of being in production accounted for almost half of all the cars sold till then in the world.
Example: In India, a good example would be Bajaj Auto. Before 1982, it offered only one
kind of scooter with two different names: Chetak and Super. Chetak was meant for export and
was available to a resident Indian only in foreign currency, and Super in Indian currency. And
that was its only offer. The consumer had to accept the offer whether he liked the design or not.
The Indian consumer had not much quality choices in scooters, and admittedly, Bajaj Auto did
manufacture its limited variety of wares with attention to high quality. There werent too many
alternatives; the market was not mature enough to understand the varied depths of its demands.
Consumers were passive and undemanding; there was not much competition, even from the
other scooter in the market, a clunkier, chain-driven but rugged make called Lambretta.
7.4.2 Differentiated Marketing
After this came the second stage of evolution of marketing. With a little more competition, and
with the customers becoming more mature, the organisation now introduced slight variations
in its product models. But nevertheless it dumped the entire product on to the market. Expecting
the market to choose slight variations, the organisation offered the same core product in these
variations.
Example: Hero Honda in 1986 had the same core 100 cc, four-stroke engine motorcycle
but made cosmetic changes in its designs naming one as Candy model CD100, another as Sleek,
and a third as CD100SS. But the core product was the same, and the company expected that the
market would have consumers who would make their choices out of these.
The customers were seemingly anesthetized to the fact that the core offer was the same and the
variations were mostly cosmetic. There were other organisations, too, that were making use of
this particular type of marketing which is prevalent even now.
The next step for the service marketer was to deliver more value to consumers with added
benefits commensurate with the identified consumer needs. By doing this, he achieved two ends
simultaneously: overcoming the consumers inherent negative perception of receiving the same
core product with mere cosmetic changes and successfully targeting a broader market base
with differential benefits.
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