The Commodification Epidemic.


There is a lot of talk about commodification around these days, but let's not forget what a commodity actually is. A commodity is defined as a product that can only be differentiated by price.

You don't have to have a remarkable innovation to avoid commodification. A me-too product does not necessarily have to be a commodity. It may be very similar to the competition, but you can still differentiate it by distributing it in a different way. You can decommodify its delivery and retail channels.

You can even decommodify it by focussing on another aspect of the product. I'm not talking about faux emotional differentiaton here, but an aspect that is common to all your competitors. An aspect which they've chosen not to emphasise because they've overlooked the fact that its customers who decide what it is that they like about a product. You surely don't see your product as uni-dimensional?

Technology and transparency certainly mean that commodification is more prevalent than before, but that's no reason to bow to it without a fight. As I've said before, if you compete on price, you are explicitly saying that you have no belief in the intrinsic value of your product. If that's true, you deserve to fail.

Comments

Post a Comment

Popular posts from this blog

Thinking about creating a blog (Part 2)...

If you are thinking about creating a blog for your organization, there is one thing I cannot stress enough: make sure those who will be contributing content have bought into your idea! I have created a couple of blogs for different organizations, and I must say that I have learned this the hard way. Don't get me wrong. I think that blogging is very effective if done right, but that is a really big IF. Many organizations launch blogs and don't do it right, and when the blog fails they blame it on the ineffectiveness of the technology. Readers of a blog don't want to get hit with your marketing messages! If you try a hard sell technique with every blog, of course your readers are going to start tuning out your blog. You need to offer your readers a reason to read your blog, and a way to do that is to offer exclusive content that they can't get anywhere else. This is the reason that while at Virginia Stage Company, I started to post video clips of rehearsal and "behin...
Read more

Marketing Awareness.

Modern marketers tend to get very excited by ideas of conversation and engagement with customers. Given that they are aware how many images and messages each of us receive every day, they have become less impressed by the more basic aim of generating awareness. This, I think, is why this pun-based campaign has received such criticism from within the advertising world. Some complain that the imitation of Morgan Freeman is a deceitful hijacking of the actor's gravitas while others just deem it trite, shouty advertising disguised as something else. But that is to overlook context. It's an ad for insurance. Insurance stubbornly remains a commodity business where price trumps service because we buy it before we need it. The engagement with the product/service occurs at a time of distress and not at a time of purchase. In a commodity business, awareness is key. You want your customer to have your name come to mind when they consider the purchase. It's brutally simple. A differen...
Read more

Thinking Inside The Box.

Image
A combination self-help and business book, Michael Port's Beyond Booked Solid focusses on scalability issues and how to expand a small enterprise. It is filled with pragmatic tools and techniques designed to grow a business via innovation and leveraged income, but the key message is that of developing a mind-set that works on your rather than in your business. To some extent that's just a reframing of the old adage of keeping one's eye on the big picture, but it's something that can't be repeated too often. Constantly reminding yourself and your colleagues of why you're in business (and specifically what customer needs you meet by doing something better than anyone else) is crucial to evaluating everything that you do day to day. If your marketing tactic du jour, your latest product development or your inter-departmental meeting isn't centred on that, they're not worth your time and resources.
Read more