“Only shop on price” is a sign of a commoditized product.
The Big Idea: Nothing is destined to be a commodity. But you can turn anything into one if you aren’t careful.
The fastest way to turn your product into a commodity?
Discounting! Price-based promotions!
What is going on here: Travel has become commoditized through:
- Daily deal apps like Hotel Tonight
- Mergers that have lessened competition
- Third parties that use promotions to acquire customers
Combine these things with inflation, wage stagnation, and higher debt levels and you get a situation where your product can easily fall into “The Commodity Trap”.
Can you avoid this trap: Yes. No product is destined to become a commodity.
You begin by looking at your position in the market:
- Are you differentiated?
- Is your offer relevant to your target market?
- Can you defend your offer over the long term?
Besides that:
- Avoid price-based promotions
- Discounts
- Price wars