Evaluating Your Product's Uniqueness

The closer your product resembles competitive products, the smaller the price differences that buyers will tolerate. And the less the product differences between brands, the greater the probability is that the category is price-elastic, and that brand-switching will occur when products go on sale.

It is not enough for a product to be unique. The sources of product uniqueness must be both recognizable and valued by buyers. And depending upon the category, very unique products may or may not be readily accepted by buyers.

For example, gourmet food products have many distinct and unique attributes in any given category. Buyers shop for gourmet products because they are often looking for new, unique products — "something out of the ordinary."

However, the majority of products sold through mass merchandise stores, grocery stores, chain stores, and vending outlets are easily substituted from among many similar brands. Sources of brand uniqueness are generally very small differences. Usually, buyers aren't looking for new or unique items in these categories.

What does product uniqueness mean for pricing? Product uniqueness does not guarantee a significant price premium over a competitive product, if the product differences aren't recognizable and meaningful to consumers. And depending upon the category, even recognizable and meaningful product differences may not be enough to get buyers to switch to the new product, even at parity pricing, let alone at a premium price over the competition.

Field testing on a small market basis is highly recommended for questionable new product differences and unique new products.