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Avoid The Commodity Trap: Raise Your Price! | Brand Quarterly

What Is The Commodity Trap?

Suppose you own and operate a wedding cake business.  You hone your baking craft to a sweet science.  You develop an extensive catalog with designs that range from traditional to ultra modern, complete with pricing options.  You build a great website.  You join the local chamber of commerce.  You educate yourself about what your competitors are doing and how much they charge.

In other words, you do exactly what every other wedding cake business is doing.

Now, suppose I am in the market for a wedding cake.  I am considering buying from you as well as from two other legitimate companies.  To me, it’s all just cake.  You all offer great options that suit my needs and the online reviews report that all three businesses offer high quality and great service.  Everything appears equal.

In this scenario, how do I choose?  It’s simple.  I defer to the most obvious delineating factor: price.  Now you, the conscientious business owner who pours heart and soul into their work, find yourself unwittingly stuck in the commodity trap.

The commodity trap occurs whenever a buyer encounters value vagueness.  If a buyer cannot distinguish a true value advantage, they default to a price-based decision.

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Avoid The Commodity Trap: Raise Your Price!

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