Most brands start out distinguishing themselves based on products and unique service offerings.  As the market develops, there are fewer ways to differentiate product lines.  Features become ubiquitous across brands and most are forced down the dark road of competing on price alone.

This, however, is just one possible fate for developing markets.  The other fate is to develop into a luxury market.  By branding the shopping experience, rather than the product.  A good example is jewelry.  This is an obvious extravagance, but think about how jewelry stores distinguish themselves from one another.  The products are identical, prices are very much the same, but different brands carry different store layouts and offer distinct levels and versions of customer service.

Even the coffee industry has gone this route.  Starbucks does not franchise its stores, it licenses its brand (its experience).  Coffee will be relatively the same no matter where you buy it, but each coffee shop has its own design, character, and experiential brand.

What other industries do you know of that have moved into a luxury market?  What developed markets do you see that have failed to develop this way?