What Is Concentrated Marketing vs. Differentiated Marketing?

Did you know that, on average, marketers report that they waste 26% of their budget?

Depending on the scale of your business, this can be quite a chunk of change. Especially if you are not seeing results.

One of the keys to maximizing your marketing budgeting—and its returns—is to understand what marketing strategy is right for you.

Two common, yet very different, strategies are concentrated marketing and differentiated marketing. Depending on where your business is at, you’ll either want to implement one or the other in your overall marketing strategy.

Ready to find out which of these methods is for you? Read on for everything you need to know about concentrated marketing vs differentiated marketing.

What Is Concentrated Marketing?

Concentrated marketing is when a company creates a single marketing message. This message is for a narrow and very specific demographic. Concentrated marketing is also sometimes known as niche marketing.

Instead of trying to target a wide demographic, a company zeros in on one particular target market.

For example, let’s say a startup sells eco-friendly baby shampoo and soap products. To hone in on the consumers that are truly interested in its products, it will target mothers who are environmentally conscious.

However, it’s products also cost more than the market average. Therefore the company narrows down its customer profile further. They do this by targeting women between the ages of 24-43 who have average-to-high income levels.

By doing this, the startup will concentrate its marketing efforts on the consumers that matter most. This reduces expenses and marketing workload.

Once it has defined its specific customer profile, the company will tailor all of its marketing messages to this group. They will also target their advertising towards this demographic when doing paid ads and social media campaigns.

Pros and Cons of Concentrated Marketing

One of the big advantages of concentrated marketing is that it’s highly cost-effective. It’s also ideal for building authority and a strong, loyal customer base.

These benefits make concentrated marketing ideal for new businesses with limited marketing budgets. It’s also great for companies that are trying to find their niche and voice.

As for the cons, the main downside to concentrated marketing is it targets smaller groups of people. It can also lock companies into a single brand voice and value proposition. Down the line, when they want to expand, this could be a challenging factor to overcome.

What Is Differentiated Marketing

Differentiated marketing is a form of target marketing. It happens when a company carries out a campaign aimed at multiple market segments or target audiences.

In this way, it is almost the opposite of concentrated marketing.

Instead of focusing on only one target customer, differentiated marketing is all about appealing to various groups of consumers. By doing this, companies can build their customer base, expand their offerings, and fill out their niche.

If we take the previous startup as further example, say they decide they are going to launch a new product line for older kids. The new product is specifically designed for children aged 5-13. This then expands their target demographic.

To market to this new demographic, the company would then create tailored marketing messages. These would be aimed to specifically resonate with women who:

• Have children aged 5-13
• Are environmentally conscious
• Have a medium-to-high income level

At the same time, the company would continue to target their audience of new moms for its initial products.

Depending on its offerings and resources, a company can carry out as much market segmentation as it wants with differentiated marketing.

Pros and Cons of Differentiated Marketing

The main benefit of differentiated marketing is it allows brands to address multiple demographics. However, because it’s still targeted, each group receives a tailored marketing message that will resonate with them.

This is in contrast to undifferentiated marketing. In undifferentiated marketing companies target numerous demographics and customer profiles through one message. This type of marketing is more traditional and often occurs on television and radio.

Overall, the advantages of differentiated marketing can include:

• Enhanced brand awareness
• Effective demand generation and lead generation
• Increased market share

However, differentiated marketing does have some downsides. Firstly, it is a lot more costly to implement. It is also more time consuming to carry out, requires more manpower, and is more complex to manage.

For instance, should you want to do a marketing audit, you will have numerous campaigns to analyze.

Concentrated Marketing vs Differentiated Marketing: Which Should You Implement?

So, which marketing strategy is better, differentiated marketing or concentrated marketing? The answer to this depends entirely on your business and its stage of growth.

If you’ve recently launched or are trying to find your niche, concentrated marketing will likely be the better option. It is simpler and cheaper.

On the other hand, you might want to consider differentiated marketing if you:

• Have defined your customer based
• Want to expand
• Want to refine your marketing campaigns

One word of caution. If you begin with concentrated marketing, treat it as a stepping stone towards differentiated marketing. Otherwise, you might find your brand locked into one voice and one value proposition.

Are You Ready to Kickstart Your Marketing Strategy?

Effective marketing is essential for any business, new or old. One of the top reasons for business failure is ineffective marketing. Whatever stage your business is at, it’s essential that you employ strategic marketing that’s tailored to your brand.

Not sure whether to implement concentrated marketing or differentiated marketing? Would you like expert help with your marketing?

We specialize in B2B marketing services. Contact us today to discuss your marketing needs.