Final answer:
The term describing the modification or creation of products or services is product innovation, involving product differentiation and technological change to improve competitiveness in the market.
Step-by-step explanation:
The term for changing the appearance or the performance of a product or a service, or the creation of a new one, is called product innovation. Product innovation involves actions such as product differentiation, which is any effort a company makes to distinguish its products from those of competitors. Such innovations can be incremental, like making minor improvements to a product, or radical, which might involve creating an entirely new product that changes the market.
Innovation itself is the general process of making changes to an existing product, system, or process in order to improve it. This can include technological change, which merges invention - advances in knowledge - with the practical application of these inventions. This concept is integral to keeping a company competitive in the market by continually 'improving' products as consumer preferences evolve and markets demand new offerings.