How Can Differentiated Marketing Benefit Your Business?

Two marketers consulting with each other

As startups develop beyond inception, their target markets often grow and mature, expanding to include entirely new consumer categories. Therefore, entrepreneurs must grasp this opportunity and rapidly adjust their promotional strategies to successfully gain the attention of varied market segments. 

In order to accomplish this, you can adopt a tried-and-tested marketing approach: differentiated marketing. This method allows companies to reach out to more than one customer segment through focused promotional strategies, securing extended marketing reach and buyer consideration.

What Is Differentiated Marketing?

The term differentiated marketing is used to describe the approach of targeting two or more consumer groups through marketing campaigns and activities. This can include buyers with different demographic characteristics, distinct needs, or merely contrasting preferences.

Marketers can effectively reach these dissimilar segments by, for example, creating several versions of campaign messaging tailored for different audiences, adjusting special offers to shoppers with separate levels of disposable income, or even positioning a number of product lines in trade shows and events to each attract the intended buyer groups.

Differentiated marketing is not the only method of its kind, categorised specifically by its market segmentation approach. Concentrated marketing describes a similar promotional practice by which businesses focus on just one – extremely specific – customer segment. This is often utilised by brands during the initial stages of their establishment, or to capture an existing, niche market. It may also be adopted by businesses offering specialised products and services that only appeal to smaller buyer groups.

The Benefits of Differentiated Marketing

So, why should entrepreneurs invest their time in building a differentiated marketing strategy? Because, as detailed below, the approach offers many competitive benefits, particularly to small businesses. For instance:

1. It Speaks to the Needs of Your Customers

Differentiated marketing allows you to advertise how your products and services fulfil the varying needs and expectations of numerous types of consumers, supporting your lead generation and lead nurturing processes throughout the initial stages of your marketing funnel. 

An example of this would be launching a promoted social media marketing campaign highlighting the product features that best address your target audience’s pain points. This would ensure that the relevant positioning is delivered to the appropriate segment, thus capitalising on knowledge of your audience's unique circumstances to drive the desired demand. 

Business owners can successfully drive awareness, create interest, and earn consideration of potential consumers in this way. 

2. It Increases Customer Breadth

When crafting traditional marketing strategies, entrepreneurs tend to focus on their core consumer group, conceiving how to engage with these shoppers and move them along the buyer journey to the final purchase stage. While this approach is essential during the establishment of a new brand, once a business has successfully captured its main customer group and has gained more traction in the market, it's time to focus on increasing customer breadth. 

Among the main advantages of differentiated marketing is its effectiveness in enlarging the pool of consumers your brand reaches through its marketing, helping you appeal to segmented audiences through complementary promotional activities.

An example of engaging with numerous buyers through differentiated marketing is running a special offer aimed towards two or more shopper groups. One product category included in the promotion may appeal to your core, loyal consumer market, while the other is positioned to draw in new shoppers who usually purchase your competitors' offering and have yet to consider yours. 

Such sales can even be time-sensitive, offering discounted pricing on certain products during off-peak business hours to draw in new buyers, while promoting frequently purchased products at peak times to re-engage existing or dormant consumers.

3. It Achieves a Better ROI

Although the execution of differentiated marketing involves more detailed consumer segmentation processes, increased planning, and execution monitoring, it can often result in much more advantageous returns on your marketing investment compared to traditional marketing strategies. 

By targeting two or more customer groups, you have a better chance of earning increased volumes of sales across diverse products that fulfil those buyers' differing needs. These segments may also be newly adopted by a brand and thus constitute entirely new sources of revenue, setting a precedent for future promotional ROI expectations.

Furthermore, because this approach requires you to precisely define your desired audiences and marketing delivery tactics to reach potential buyers, your ROI can be more accurately projected prior to execution. In this way, you avoid the trap of hastily investing in reaching a single, broad consumer group whose needs do not match those filled by your products and services, essentially wasting marketing dollars.

4. It Supports Growth Strategy

Ultimately, differentiated marketing supports your brand's efforts to grow by appealing to a wider audience and capturing a greater share of their market. This may can coincide with your company's expansion into new markets, the launch of new products or services, or rebranding efforts.

Successfully executed differentiated marketing proves your ability to fulfil the requirements of different consumers – or indeed the same buyers as their needs change over time – as well as adapt to changes in the market, and rise to the challenge of beating out key competitors.

Building a Differentiated Marketing Strategy

To craft a differentiated marketing strategy, start by defining your business objectives. Do you need to promote new products? Reinforce brand positioning to drive your company's reputation among the market? Or are you trying to re-engage lost customers? The answers to these questions will help you identify the key goals of your strategy.

Next, identify the two or more customer segments that you will focus on in order to achieve your objectives. Use market research to note as much detail about these consumers as possible, including demographic characteristics such as age, gender, location, income level, education and profession. Don't forget to also delve into their motivations, preferences and needs, to effectively leverage this information during your marketing.

Based on this information, you can then decide how to best appeal to those consumers, selecting the marketing activities, content, delivery, and budget that will form the basis of your differentiated marketing strategy. 


Adopting a differentiated marketing approach can significantly support you in achieving your business' growth-oriented goals. By reaching out to two or more customer segments within the same promotional strategy, you can effectively and efficiently capture the attention and consideration of buyers, accelerating increases in customer breadth, company revenues, and return on promotional investment.

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