Beating The Commodity Trap: How To Maximize Your Competitive Position And Increase Your Pricing Power (PB) By: Richard Anthony DAveni

What do high-end fashion companies, the Razr, and Harley-Davidson have in common? All are, or have been, in a battle against commoditization in their markets. Whether caused by a new low-cost competitor (such as fashion's Zara), new product innovation (such as the iPhone), or the introduction of multiple substitutes and imitators (such as Honda, Suzuki, Victory, and Big Dog motorcycles), price competition is always costly and sometimes even deadly. The conventional wisdom for fighting commoditization advises either cost reduction (without sacrificing margin for share) or increased differentiation (to maintain a higher end competitive position). But there is little advice on how to identify the root cause of commoditization, so that the very source can be eliminated, escaped, or in some cases, even used to advantage. Based on an in-depth study of more than 30 industries, in Beating the Commodity Trap author Richard D'Aveni reveals the three most common patterns that create "commodity traps" deterioration, proliferation, and escalation and offers targeted strategies, beyond cost reduction or continuous differentiation, that companies have used to address these dilemmas successfully. For each of the three traps, D'Aveni shows how to: