Differentiation is one of the strategies that firms employ in an attempt to gain a competitive advantage by increasing the perceived value of their products and services relative to the perceived value of other firm’s products and services. This paper examines the influence of product differentiation and organizational performance based on a study of Sameer Africa Ltd in Nairobi, Kenya. The study targeted 112 employees of Sameer Africa (K) Limited, comprising senior management, HODs and junior staff and 90 dealers based in Nairobi. A sample of 134 respondents was selected using stratified random sampling and simple random sampling techniques. The study was guided by Strategic Balance Theory. Primary data was collected through self-administered questionnaires. The quantitative data was analysed using descriptive statistics in the form of tables and inferential statistics in the form of Pearson correlation and regression analysis with significance level of 0.05 to test the hypothesis. The study was significant and provided an empirical evaluation of the relationship between differentiation strategy and organization performance. The study found that product differentiation had a positive relationship with organizational performance. The study concluded that integrating product differentiation strategies through specific product attributes relevant to competitors and variety of products to match the need of various customers would result to improved performance. The study therefore recommends that product differentiation should be adopted because they have the highest relationship with organisational performance.
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