I guess I shouldn’t be surprised, but it is disappointing when a company starts behaving like an incumbent politician. There are those who firmly believe that incumbents are heavily influenced by campaign contributors and special interest groups; often forgetting the needs of the constituents who they are truly supposed to represent. Similarly, there are established companies that lose focus on the very customers who made them successful. With their drive to maximize revenue and profitability, instead they find that slowly over the years they start spending more and more of their time catering to their advertisers. This is sadly ironic, given that those advertisers are only interested in the eyeballs and wallets of those very customers. Lose the audience, lose the advertisers. Read full article…
I have talked about the commoditization of the coffee business before. You can certainly get a good cup of coffee (or name your favorite coffee drink) at many of the coffee houses that sprang up over the past decade. So, when “quality” is no longer the differentiator that it once was, what is a coffee house owner to do? Well, as many industries are discovering, you start focusing on differentiating through the consumer experience.
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Commoditization. It happens in every industry as it matures. As companies struggle to compete and differentiate themselves, they succumb to pricing pressure and feature wars. We’ve all seen it happen with both goods and services. And, we’ve seen it happen in the technology industry too. Software with even more features than the competitor with the requisite feature chart on the back of the box. Internet access pricing being driven down to almost “free” levels. Web hosting for absurdly low monthly fees with an ever-increasing set of available features.
So, what is a company to do? Well, some have spent time understanding their customers and what it is that creates loyalty. Those companies have learned that earning the loyalty of a customer goes way beyond offering the lowest prices or the most features. In fact, loyal customers will often spend more for less. As a very loyal customer of Apple Computer, I can attest to that. Why? Because we value the holistic experience of that brand and what it provides us. Read full article…
