Friday, February 26, 2010

World Differentiation

How many companies are there that don't need to worry about sales? After all, doesn't anyone who takes an introduction to business course learn that businesses are there to make a profit? Well, this story from the Winnipeg Free Press changes the rules. The reason that this business does not need to worry about finding potential business partners is because who would not want to have their brand associated with the standard for international competition? If you did not cheat and look at the hyperlink that I inserted a few lines ago, you might be thinking about a brand such as McDonald's or Wal-Mart that are simply everywhere. However, this brand is the famous five rings of the Olympics. The International Olympic Committee is able to be extraordinarily selective as to the brands they associate with in and of themselves. In order to be associated with the IOC, the companies must be willing to sign an eight-year agreement. Even though many companies might be willing to do that, the IOC only allows 9 or 10 sponsorships at one time. Through this strategy of product differentiation, the Olympics logo has become a symbol of elite athletes and products. When a product can have this type of brand power that allows it to even turn away perfectly viable companies, you know that they're doing something right with this strategy. This is the type of product differentiation that companies should strive to achieve.

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