A successful brand can be many different things, but there’s one thing it definitely can’t be: replaceable. Commoditization is every brand owner’s worst nightmare—after all, if your audience can’t tell the difference between your product or service and that of your competitors, they’ll have no reason to remain loyal to your brand.
Luckily, there are plenty of strategies you can use to ensure that your clients continue to view your services as the unique offerings you know they are. This blog post will cover nine of these strategies—but first, let’s take a closer look at what it means to be a brand instead of a commodity.
What is a commodity?
To make sure your brand doesn’t become a commodity, it’s crucial to understand the difference between the two. In simple terms, a commodity is a product that can be easily substituted for one from a competing company. There’s plenty of demand for the product, but there are no qualitative differences across brands. This means that consumers’ decisions about which brand to purchase the commodity from rests only on price and availability—neither of which are always within a business’s direct control.
A common example of a commodity is fresh produce. Beyond the question of organic vs. inorganic, there’s not much that distinguishes one bunch of bananas from another besides the sticker on the peel. Likewise, you can think of the difference between a commodity and a brand as the difference between a product and the company itself. For instance, athletic shoes are a commodity, but Nike is a brand—and Nike has built such a strong brand that their customers are more than willing to pay extra for that distinction.
Nine Strategies To Prevent Commodification
As a business owner, your goal is to build a brand whose customers won’t make substitutions based on price or availability. You need to give your audience an incentive to buy your service or product, even if one of your competitors offers it at a lower price. Below are nine of the best strategies for accomplishing this.
Create an emotional connection
One key difference between brands and commodities is that a brand doesn’t just sell a product or service—it also sells certain intangible qualities unique to that brand. Often, this means an emotional association with the brand—for instance, the feeling of exclusivity and social status associated with luxury brands such as Rolex or Prada; or the feeling of sleek modernity associated with tech brands like Apple and Google. If you can brand your product or service so that your audience associates it with a positive and desirable emotion, they’ll be much less likely to look elsewhere. Here’s some tips on emotionally connecting with your audience.
Positioning your brand is all about getting in your customers’ heads. Similar to making an emotional connection with your audience, an effective brand positioning strategy causes your client base to associate your brand with something intangible; however, you can position your brand in more than just an emotional capacity. For instance, you might create a marketing strategy that positions your auto repair brand as the go-to for fast, convenient service; or your bakery as the frontrunner in vegan desserts. Whatever positioning strategy you choose, it should be specific and unique enough for your brand to sit in a separate arena from the competition in your customers’ minds.
Adjust your pricing structure
To stop your brand from becoming a commodity, you’ll need to make it known for more than just a low price. However, that doesn’t mean you can’t use pricing as a tool in your branding. Getting creative with your pricing structure will make it more difficult for your audience to make side-by-side comparisons with your competitors. For instance, you may price your services differently during times of high demand—a pricing model many businesses in travel and event industries use extremely effectively. Or, if you can position your brand as a luxury name, you may be able to charge a premium based on the perceived value of your product or service.
Bundle your services
One particularly effective pricing adjustment you can make to your business is to bundle your services together. For instance, a design company might offer a bundle for budding entrepreneurs that includes website design, logo design, and business cards, all for a single price that is slightly discounted from the total price of buying those three services separately. (Including an after-sales service is another easy and effective bundling option.) The appeal of bundles to your clients is twofold: not only do they get a discounted rate, but they experience the seamless convenience of getting everything in one place. There’s also plenty of room for uniqueness in creating bundles, making it more difficult for competitors to imitate your offers.
Segment your audience
You’re probably familiar with audience segmentation in email marketing—it helps ensure the correct information reaches the correct parts of your consumer base. Strategy + Business Magazine explains how you can apply similar segmentation tactics to your branding, in a process they call “carving up the market.” Essentially, you can use marketing research tactics to figure out which of your clients or customers want, need, or are willing to pay for differentiation—what sets your brand apart from the competition. It may seem counterintuitive to try to cut back your audience—after all, as a small business, you’ve likely spent plenty of time and money trying to achieve the widest reach possible. But segmenting your audience will ultimately drive your profits, as you’ll mainly speak to the people who are most likely to buy into your efforts to set yourself apart.
Build relationships with your audience
Think back to the basic marketing funnel model—specifically, the “Nurture” and “Convert” components. Businesses that sell commodities don’t believe they need to continue nurturing their audience once they’ve converted them to paying customers—they’ve already made the sale, which is the sole concern of a commodity-based business. But strong brands know the “nurture” stage doesn’t end with conversion. Building genuine relationships with your clients will go a long way in establishing trust and loyalty, and will make it much less likely that your clients will seek out a less expensive competitor. If you run a small business, particularly a service-based one, it’s easier to build relationships on a personal level, but you can achieve this connection no matter how large your business is. For instance, a customer loyalty program with points, rewards, and free gifts is a terrific incentive that keeps your clients coming back to you.
Keep your brand visible
The most successful brands make such an extreme effort to be visible, it seems like they’re everywhere. Just think about how many Starbucks coffee shops you drive past on your daily commute—and even if you don’t have a Starbucks nearby, you’ve likely seen their coffee sold at grocery stores and served at restaurants and hotels. On the other hand, generic coffee is invisible from a marketing standpoint—it doesn’t have a name to display on a menu or a logo to emblazon on a cup. This is another crucial difference between brands and commodities: brands are visible, while commodities are invisible. And if you want your audience to engage with your brand, they have to be able to see it.
If you’ve ever been on a long trip, you know how it feels to stumble into a chain restaurant—let’s use Hard Rock Cafe as an example—for dinner after hours or days of travel. Even if you’re in the middle of an unfamiliar part of the world, you can rest assured your dining experience at this foreign Hard Rock Cafe will be nearly identical to that of your local version. From the menu to the rock-themed decor to the knowledge of the staff, you know what to expect—and it’s comforting. That’s the power of consistency in branding—if you can recreate a specific experience that your customers can expect every time they interact with your brand, regardless of their location, you’ll have the ability to scale your business to a national or international level if you choose. Remember that details matter, because they make it much harder for your competitors to imitate you—and embarrassingly obvious when they try.
Keeping your branding consistent doesn’t mean you can’t improve. One powerful way to keep your brand inimitable and irreplaceable is to stay innovative and ahead of the competition. It’s important to regularly conduct market research among your audience and industry, so you can be sure you’re giving your clients the services they need today, rather than the ones they needed ten years ago. If your competitor offers a product or service you don’t, brainstorm how you can improve upon their model. Even better, try being the first in your industry to create something new—it will set you apart as the gold standard original in a sea of imitators.
The bottom line: Be yourself
The nine strategies above are all effective weapons in your brand’s fight against commoditization. But the most important thing to remember above all is what ties them all together: the importance of being unique. If you can demonstrate to your audience that the services or products your brand offers are markedly different—and better—than the services and products they can get from your competitors, you’ll never need to worry about being replaced by a generic alternative.
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About Miss Details
Founded by Tanya Gagnon in 2004, Miss Details is a full-service branding and design firm which helps entrepreneurs and companies launch, adjust and reinvent key aspects of their branding and business marketing strategy. With a background in all aspects of interior and experiential design and a passion for data-backed design, Tanya leads the Miss Details team to guide her clients through everything from a refreshed website to a full rebranding, helping them put the pieces together to create a consistent, authentic, unique brand image.