Making Your Commodity Stand Out

A commodity offering, by definition, means undifferentiated. A consumer has no reason to choose other than the cheapest.

But by small changes to materials, processing, or marketing, a commodity can become distinct and earn a higher price.

Example: today I wanted to buy low sodium tomato sauce. There were 3 brands and 2 container types that all said ‘no salt added’ on the front. Had I not read the labels carefully I would have purchased either the cheapest or the brand I know best.

But the details showed that the actual quantity of sodium per comparable serving varied widely. I bought the one with the lowest sodium content. But only because I took the time to figure out there was a real difference.

Clearly consumers of this ‘no salt added’ product care about sodium content, but may not suspect distinctions among them.

A label noting the extremely and relatively low salt level could increase sales simply by making it easier to know. Perhaps minor process or ingredient changes could reduce sodium levels to the point of ‘no sodium’ labeling, which could further differentiate.

Know where your offering can be easily differentiated in ways the customer cares about. If it can pay for itself, make the change.

Otherwise you’re leaving your future to chance.

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