Are you turning your company’s product into a commodity?

Scarcity and Urgency are always factors in product marketing.

Like so many of you, I ran to the store during the Covid pandemic to buy toilet paper (loo roll for my UK friend). The prices were high and nothing was left on the shelf. We weren’t even out at home, just knew it was scarce and I was ready to buy!

Compare that with today. At the same local “Target” store there is plenty of stock, lower retail prices, and several brands even have sales going on.?

Yet today I am in no rush to buy. Lower prices. Plentiful inventory. What is different????

No scarcity and hence no need to seek the product out to purchase it.?

This is just a quick reminder about how Scarcity and Urgency work in the pricing of products for consumers. The former is dependent upon supply, while the latter is a time-based driver–essentially, do I need it now?

When offering products I find it helpful to keep in mind that products that lack scarcity and are often available at a discount do not inspire the buyer to take action.

These products have been commoditized by their sellers and any business will struggle to grow with a solid margin on products like this. Too much competition with similar products…and a history of discounting. That is a formula for a bad business.?

When faced with this the marketer must reset the customers’ perception of the product's value and build a sense of urgency. Here are a few tips:

1. Clarify how the product uniquely serves a need.
2. Promote and advertise more as you cycle down the discount price offerings.
3. Up your quality and service game to make customers vocal fans and to help you reach new customers.?
4. Make it easy for customers to let others know about your products that they love to grow your reach.

There are ways to break a cycle of commoditization, but none are as easy as avoiding it in the first place. If you are stuck in the cycle…roll up your sleeves.

Until next week,

Kevin