Differentiation vs distinctiveness: why brands need both

For the past decade, marketing has been arguing about differentiation and distinctiveness as if we had to pick a side. One camp says brands should stop chasing unique differences and focus on being easy to recognise. The other says a brand without a meaningful difference has nothing to charge for.

I’ve always believed differentiation and distinctiveness work beautifully together. There’s no need to put them on a battlefield. This guide explains the difference, why each one matters and how to use both.

What’s the difference?

• Differentiation is about meaning: being seen as different from competitors in a way people value. It gives people a reason to choose you, and to pay more.
• Distinctiveness is about recognition: being instantly identifiable through your brand assets, such as colours, logos, characters, sounds, shapes and taglines. It helps people notice and remember you, and find you at the moment they buy.

One answers “why you?”. The other answers “which one was that?”. Strong brands need both answers.

Why differentiation still matters

In recent years we’ve been unfair to differentiation. Mark Ritson makes a strong case for it in his Mini MBA webinar Defending Differentiation, where he argues for relative differentiation, being meaningfully different in people’s minds, rather than being completely unique. That’s a far more realistic goal.

The commercial case is about price. Nigel Hollis of Millward Brown points out that, according to Empirical Generalizations about Marketing Impact from the Marketing Science Institute, “long-term sales growth for a brand is derived mainly from category growth”, which is hard to come by in mature categories. But a brand’s value isn’t only about sales volume; it’s also about profitability.

If you can command a premium price, you can grow brand value without big volume gains. McKinsey found that, with volume stable, a 1% increase in average price improves operating profit by 8%, three times the effect of a 1% increase in volume. And a 1% price cut has the opposite effect. What justifies a premium? Perceived differentiation: being seen as a desirable choice with a meaningful, relevant and valuable point of difference.

Building distinctive brand assets

Distinctiveness is built through brand assets used consistently over time. Ipsos has a useful model for guiding a brand distinctiveness strategy, mapping assets by how strongly they are linked to your brand and how unique they are to you:

Do brand assets have to be meaningful?

Not necessarily. Sometimes it’s fine for an asset to simply evoke the brand name without also saying something about the brand. But it certainly helps when your assets support what the brand wants to stand for. Nespresso is a great example: a rich, varied set of distinctive assets, all of which reinforce the sophistication the brand wants to be known for.

How to use both

• Start with the difference. Define the meaningful, relevant point of difference your brand can own. That’s your positioning.
• Make it recognisable. Choose a small set of assets that are unique to you and use them everywhere, consistently, for years.
• Let assets carry meaning where they can. Where an asset can express your difference, like Nespresso’s sophistication, it works twice as hard.
• Measure both. Track how people perceive your difference and how quickly they recognise your assets.
• Protect the premium. Resist price-led growth that erodes perceived difference.

Differentiation vs distinctiveness: FAQs