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Avoid the Commodity Trap - (Reed Holden)

Avoid the Commodity Trap - (Reed Holden)


During this prolonged market downturn, business clients are especially price sensitive when buying services or a product/service bundle. Many customers have frozen or reduced budgets and use internal resources for less than optimal solutions. Those that are purchasing services are becoming increasingly sophisticated buyers that view services as a series of well-defined commodities that are available from a plethora of companies. Unfortunately, many service vendors have not updated their offering to meet the evolving needs of their business customers. Nor do they communicate their unique value to each client. As a result, customers that are buying focus primarily on price, knowing that suppliers will respond with even greater discounts. Or worse, suppliers will give away services to close the sale of commodity products, thus undermining the true value proposition.

To avoid this commodity trap, companies must become adept at diagnosing their customers’ business problems, developing targeted solutions, targeting the right members of the customer buying organization, and communicating this value to the client in terms relevant to their business. Simply stated, the firm must become a trusted advisor to the customer, partnering with the customer to deliver greater and greater value to their business operations. Absent this relationship, customers will view low-cost as the only value delivered by their commodity provider and will be happy to let multiple vendors duke it out with low prices. Profitable services marketers are astute students of customer economics and are adept at using their insights to create differentiated offerings that generate customer interest and pricing leverage.

This Online Pricing Course is designed for national and global organizations that provide services and/or bundles of products and services.

Meet Your Instructors

Reed K. Holden, D.B.A.
Founder, Holden Advisors

Reed K. Holden, D.B.A., Founder, Holden Advisors. A world-class pricing expert and founder of Holden Advisors, Reed helps companies worldwide in a broad range of industries create go-to-market strategies that drive price leadership and profitable growth. He is an enthusiastic and persuasive advocate of the Value DisciplineSM, a process he pioneered to help companies in highly competitive markets optimize their marketing programs. As a change agent, he helps business leaders put these strategies into action by instilling pricing confidence across their organizations and within the executive ranks.

Dr. Holden’s latest book, Pricing with Confidence: 10 Ways to Stop Leaving Money on the Table, provides a practical framework and compelling examples for his presentations and keynotes. Co-authored with Mark Burton, the book gives sales, marketing, finance, and pricing leaders an actionable road map for working together to outperform the competition.