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it depend on what applications you have on the server,
using incremental backup will save disk space on back up destination, but if one of the incremental backups defected, you will not be able to perform the restore
if you have an exchange or sql server you need a backup software that support these types of databases
this is an example of backup plan
use Symantec backup exec system recovery or acronis backup advanced server with universal restore to backup the server as an image with the ability to restore to dissimilar hardware in case of server hardware failure
here is an example
backup the whole server to an external hard disk, NAS or another server, as image
config the backup as full backup on each Monday
incremental backup daily expect Monday
clean up and retention policy to clean up backups older than30 days
the software should allow granular restore in order to restore specific file from image backup, symantec BESR allow restore of email message from image backup if it contain exchange server
as i know, windows server backup tool can only realize full backup and incremental backup, if you want to differential backup, it it recommend you to choice AOMEI Backupper Server edition sotware, at the same time , this software allow you to back up files and system in any place.of course you can read windows server2008 backup to know more functions.such as system and file back, differential and incremental backup,and system clone, disk clone etc.