Advantages and Disadvantages of Undifferentiated Marketing

by Alan Valdez; Updated September 26, 2017
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Niche marketing and mass customization have resulted in a very fragmented marketplace in which customers expect to be accommodated on their every preference. By contrast, undifferentiated marketing seeks to create a single, standardized product and a single, universally appealing campaign. Although this style of mass marketing is long past its prime, it may have significant advantages if properly applied.

Definition

Undifferentiated marketing treats the market as a homogeneous entity, focusing on what is common instead of pursuing differences. Its monolithic mass-communication campaigns are usually focused on a narrow product range. Undifferentiated marketing campaigns tend to use a limited number of key messages designed to appeal to a broad number of consumers.

History

Undifferentiated marketing came to prominence concurrently with the emergence of mass production in the late 19th and early 20th century, as factories specialized in building large quantities of a single, undifferentiated product. Advances in mass media during the same period contributed to the spread of undifferentiated mass marketing. Henry Ford famously used to tell automobile customers they could have their Model T painted any color they wanted, as long as it was black, summarizing the ethos of undifferentiated marketing.

Advantages

By focusing all the available resources in a single campaign and a limited line of products, a very large market is reached and significant economies of scale can be achieved, leading to cost leadership. Because there is a very definite message and a very focused branding effort, the brand image is reinforced in the mind of the public. The conjunction of cost leadership and a strong image can create a large barrier to market entry, discouraging competitors.

Disadvantages

As undifferentiated marketing strategies put all their metaphorical eggs in one proverbial basket, they are inherently vulnerable to changes in the marketing environment. Besides, customers have few reasons for developing loyalty to an undifferentiated product, leading to reduced margins as costs must be kept low to prevent customers from switching brands. Even then, firms that try to satisfy everyone in the market with one standard product may be challenged by competitors focused on delighting a smaller segment of the population. Overall, the drawbacks of undifferentiated marketing tend to overshadow its advantages, and this approach is frequently reserved for truly “undifferentiated” products such as sugar, salt and milk, according to marketing researchers Tevfik Dalgic and Maarten Leeuw in the "Handbook of Niche Marketing: Principles and Practice."

About the Author

Alan Valdez started his career reviewing video games for an obscure California retailer in 2003 and has been writing weekly articles on science and technology for Grupo Reforma since 2006. He got his Bachelor of Science in engineering from Monterrey Tech in 2003 and moved to the U.K., where he is currently doing research on competitive intelligence applied to the diffusion of innovations.

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