Friday, December 02, 2005

What's a Commodity Worth?

So I'm meeting a client of mine the other day and they tell me about this fabulous shoe store they visited where every pair of shoes & boots is $10.

Kodiak steel-toed workboots: $10
All leather dress shoes: $10

And the list goes on.

Apparently, this store buys up overstocked or otherwise unsold shoes from other shoe stores all around Niagara and sells them for $10 a pair.

What a deal - but it makes me think - why should I ever pay more than $10 for a pair of shoes again?

Is your business a commodity? If so, what's it worth?

Fortunately, for many people in the SERVICE industry, you're immune from the commodity mindset IF YOU CHOOSE.

Let me explain that one.

I'm in the Internet marketing business. There are companies out there who offer templated, database-driven, DIY websites for $20 / month. Your Name Sells Niagara South, for example.

If you ask me if I care, the answer is "no". What they're selling is a commodity - DIY websites.

But I don't charge $20 / month. I don't even charge close to $20 / hour. My rate reflects the expertise I can contribute to developing a client's overall Internet marketing strategy. If someone just wants a DIY website for $20 / month, they're not my ideal client. Since I'm not after the same type of clients as the $20 / month website folks, they're not competition.

And that's the point of NOT being a commodity. You have to know who your market is and how you serve them differently or better than other companies you DO compete with.

More importantly, you have to communicate the unique benefits you bring compared to others.

If I were the owner of a generic shoe store, I'd be working overtime to demonstrate why consumers should buy from my shop instead of from the $10 shoe paradise.

Better yet, be the only store in town that sells $500 Manolos. As long as there are enough people who want them, you'll always be in business, no matter how many $10 shoe stores there are.


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