Which competitive strategy increases market share due to product popularity?

Product differentiation is the strategy that enhances market share through product popularity by emphasizing the unique features, benefits, or quality of a product that set it apart from competitors. By offering distinct attributes or innovations, companies can attract consumers who seek specific functionalities or status associated with that product. This approach creates a strong brand identity and customer loyalty, making the product more appealing in the marketplace.

When a product is successfully differentiated, it can lead to increased customer satisfaction and loyalty, which often translates to higher sales volume and market share. Differentiation allows a company to command higher prices and withstand competitive pressure more effectively, as customers may be willing to pay a premium for what they perceive as superior products.

In contrast, cost leadership focuses on being the lowest-cost producer in the industry, which does not inherently hinge on popularity but rather on price competition. Market segmentation involves dividing a broad target market into subsets with common needs or characteristics, allowing for tailored marketing strategies but does not directly increase popularity. Price-skimming is a strategy of setting high initial prices for a new product, which can limit initial market share as it might deter cost-sensitive consumers from purchasing.