A simple definition of a commodity is: a product or service that can be bought or sold based on price and availability. It doesn’t have any quality differentiation from other products and services just like it. One bushel of apples will sell for the same price as any other bushel of apples because there is no difference between the two products, so neither can get a better price.
Here’s something you probably don’t want to hear: if you sell cabinetry and your design services on price alone, YOU ARE A COMMODITY. And you will be treated like one – disposable and forgettable if your price isn’t the lowest.
Differentiate Yourself and Your Business
As a professional who provides design and/or remodeling services, you have to distinguish yourself from what your competition offers. And don’t even think you can’t come up with ways to differentiate yourself and your business.
Starbucks is the ultimate example of a brand that differentiated itself. They turned a commodity — coffee beans — from what used to be a regular old cup of joe at the diner into a destination, an experience worth five+ dollars. Think about that.
As a kitchen designer, you know how to provide valuable solutions to consumer problems. But if your services are presented the same as every other kitchen designer’s services, you’re positioning yourself as a commodity. “Here’s some pretty pictures of my jobs”, “I can do whatever you want”, etc., etc.
The best way to differentiate your business is to add more value to what you offer.
“Price is what you pay and value is what you get.”–Warren Buffet
How Does Price Relate to Value?
First a little review:
- Price is what the customer is asked to pay for your services.
- Value is what the customer thinks the product or service is worth, the difference between the price you charge and the benefits the customer thinks they will get.
People don’t buy products, they buy the results they believe the product will give them.
People are willing to pay more for a product if they think it gives them a special or significant value—and if you present it to them in just the right way. A Cadillac looks expensive at a car dealership but looks like a bargain at a yacht show.
Sell the Sizzle, Not the Steak
But how do you sell the “sizzle” and not only the “steak”? That sizzle is there in every product or service. You can find it by going beyond the obvious list of “Our Services” and look instead at what you offer as solutions that either increase gain or reduce pain for your clients.
Don’t focus your conversations with customers on cost alone. Instead provide solutions to cost concerns. Is the cabinet grade driving cost? Is the finish or wood species driving cost?
Remember: sell value, not price.
How Do You Prevent Becoming a Commodity?
By investing in yourself and your business to improve your knowledge and skills in the areas that will enable you to deliver value to your prospects. Here’s a few suggestions:
1. Increase your product knowledge. Move beyond a general understanding of your products to a specialized, detailed understanding of how they can be used to solve customer problems and create value for them.
2. Develop your sales skills. You could consider investing in some coaching or training that will help you develop your sales skills. If that’s not possible, keep your focus on the fundamentals: delivering value, being responsive, active listening, asking insightful questions that get to the customer’s problems.
3. Improve your business knowledge. Combine #1 and #2 above to provide the problem-solving expertise and, thus, the value you need to avoid being a commodity.
Help Customers Solve Their Problem Even if They Don’t Know What Their Problem Is
Part of your value to your prospects is that you’ll be able to help them articulate the problems they want relief from. You can guide them to a solution that solves those problems in a way they couldn’t do on their own.
Most homeowners don’t know what they want, they want you to tell them what they want, or help them to figure out on their own what they want. They want you to guide them to the decision that will make their lives better, make their friends envious, make cooking their Thanksgiving dinners so much more enjoyable.
You shouldn’t be so desperate to sell that you undervalue your services. There will always be someone out there ready to undercut you, and there won’t be much customer loyalty when the decision-making process is based on price alone.
To avoid being a commodity, keep working on building the specialized knowledge and skills you need to ensure that you are always a source of value to your prospects and customers.
- Spend time marketing your business
- Have a website that showcases your work and isn’t the same as everyone else’s
- Get testimonials
- Have a list of references
- Don’t let people leave without giving them something to remind them of your business and services after they’ve gone
Bob Aungst Cabinet Sales is a full-service rep agency with one goal: to match kitchen and bath designers and remodelers with the cabinet manufacturers best suited to their business’ style and clientele. Owner Bob Aungst III represents Brighton Cabinetry, US Cabinet Depot, Jay Rambo Cabinetry, Great Northern Cabinetry, and StyleCraft.