Final answer:
Differentiated products are distinguished by their intangible features, such as reputation, satisfaction guarantees, and services like free delivery, which play a crucial role in establishing brand preference and loyalty.
Step-by-step explanation:
Products defined by a set of intangible features are often referred to as differentiated products. These products are distinguished not just by the physical attributes they possess, but also by the intangible benefits they offer, such as reputation for quality, customer satisfaction guarantees, free delivery services, or financial services like loans to facilitate purchases. Intangible aspects are potent differentiators because they can greatly influence consumer perceptions and choices, despite the physical similarities between competing products. This form of differentiation can be especially effective when enhanced by advertising, which can create and reinforce brand loyalty, even in cases where consumers might not distinguish between products based on tangible aspects alone, like taste or performance.
Overall, these intangible features play a crucial role in product differentiation, allowing companies to establish a unique position in the marketplace and to foster brand preference amongst consumers.