Decreasing profits and increasing competition characterize commoditization. This is a fact of life in most industries today for many reasons. In the eyes of your buyers, products and services are less and less differentiated.
At the same time, we have seen a significant transformation of consumer behavior. They are more informed about the products and services they want to buy; they are armed with comparative data about quality, availability, and price; and they are determined to be successful on their terms.
So, how do you and your company respond? Here are five ways to avoid commoditization in your business.
In a recent Fortune article, Verne Harnish (founder of Gazelles, Inc., and author of Scaling Up) focuses on these simple strategies to help your company stand out, avoid commoditization, and maintain healthy margins:
- Create a third market place
- Target the right customers
- Add a dose of expertise
- Don’t keep them (customers) waiting
- Amp up the personal touch
Be sure to read the full article. Then put this topic on the agenda of your monthly Leadership Team meeting and discuss how to apply these strategies. In my opinion, commoditization is one of the top enemies of Clarity in any business.
Contact me to discuss commoditization, how it is impacting your company, and how you can respond.