Consumers do not view all types of coffee as identical to one another.Some prefer iced coffee,while others will only drink non-fat latte.Still others will only drink chai latte or a cappuccino.This marketplace condition in which consumers do not view all competing products as identical to one another is called _____.
A) product differentiation
B) product variation
C) market segmentation
D) perceptual differentiation
E) selective perception

Question

Quizplus · Accepted Answer

Product differentiation refers to the condition in which consumers do not view all competing products as identical to one another. This means that consumers perceive some differences among the products and are willing to pay different prices based on these differences. The example given in the question about different types of coffee is a good illustration of this concept. Some consumers prefer iced coffee, while others prefer non-fat latte or chai latte. These preferences create market segments, and companies can use product differentiation strategies to target these segments with different products and pricing. Therefore, product differentiation is the most appropriate choice for this question.

Consumers Do Not View All Types of Coffee as Identical