Branding vs. Commodification

Branding vs. Commodification

Clients often ask about the difference in Branding vs. Commodification. Building your brand is about communicating what brand associations you want your brand to stand for in the minds of the customers you want to target. Brand building has a variety of benefits that can help you grow your company, charge premium pricing, position yourself against competitors, and be remembered by customers when they’re ready to buy.

Branding vs. Commodification

The opposite of brand building is commodification, or turning your offer into a commodity that blends in with everything in your market.

4 ways you might be turning your brand into a commodity

branding vs. commodification: 4 ways you might be turning your brand into a commodity

Common causes of commodification can include: 

  1. Under-spending relative to your competitors: To grow your brand and stand out in the market, you must be part of the conversation and invest more in your share of voice than the level of your current market share. If you have 10% market share but only spend enough for 1% share of voice, you are going quiet in the conversations your customers care about and letting your competitors own the narrative.
  2. Signaling “sameness” to customers: Customers are looking for solutions to their problems. Your positioning should address this need and communicate why your solution is best for them. Focusing on features that scream “me too” rather than highlighting that you have the basics but are also different in key ways that benefit them can weaken your ability to position your brand as the best option. 
  3. Acting off-brand: Actions speak louder than words, and taking an action that contradicts what you’re trying to stand for — for example, inclusion or sustainability — will damage your brand.  
  4. Discounting: Running sales promotions and discounts will communicate that customers shouldn’t buy from you because of what you stand for, but instead because you’re cheaper than others in the market. This turns your brand into a commodity that will only interest buyers when your price is at its lowest.

Avoid commodification and apply your brand strategy to build your brand with Clear Aim.