At other times, perceived differences between products are promoted by advertising designed to convince consumers that one product is different from another-and better than it. How is product differentiation accomplished? Sometimes, it’s simply geographical you probably buy gasoline at the station closest to your home regardless of the brand. Thus, if Coke has a big promotional sale at a supermarket chain, some Pepsi drinkers might switch (at least temporarily). But what if there was a substantial price difference between the two? In that case, buyers could be persuaded to switch from one to the other. Some people prefer Coke over Pepsi, even though the two products are quite similar. Products can be differentiated in a number of ways, including quality, style, convenience, location, and brand name.
Instead, they sell differentiated products-products that differ somewhat, or are perceived to differ, even though they serve a similar purpose. Now, however, they don’t sell identical products.
In monopolistic competition, we still have many sellers (as we had under perfect competition).
