This study aims to analyze the role of creative innovation and experiential marketing as differentiation strategies for Micro, Small, and Medium Enterprises (MSMEs) in responding to increasingly competitive market conditions. The study employed a qualitative approach using a literature review method with descriptive analysis. Data were collected from scientific articles accessed through Google Scholar, ScienceDirect, SpringerLink, Emerald Insight, Taylor & Francis Online, Wiley Online Library, MDPI, and ResearchGate. The literature search covered publications from 1985–2026 using keywords related to creative innovation, experiential marketing, differentiation strategy, and MSMEs. The initial search identified 50 articles, which were subsequently screened using inclusion and exclusion criteria, resulting in 41 relevant articles for analysis. The findings indicate that creative innovation plays a significant role in developing unique products, services, and business models, thereby enhancing the value creation and competitiveness of MSMEs. Experiential marketing strengthens differentiation by creating positive customer experiences that improve satisfaction, loyalty, and long-term customer relationships. The synthesis of several theoretical perspectives, namely the Resource-Based View, Dynamic Capabilities Theory, Experiential Marketing Theory, and Blue Ocean Strategy, demonstrates that integrating creative innovation with customer experience generates a sustainable competitive advantage that is more difficult to imitate than strategies focused solely on products or pricing. This review highlights that continuous innovation, effective customer experience management, and digital transformation represent relevant strategic approaches to strengthening the sustainability and competitiveness of MSMEs in the digital economy.