Win by tasting awful and costing more

Don't sell a commodity

Selling a commodity can be brutal. For both products and services.

You're replaceable and forever at risk of being undercut.

Here's a framework for creating a product that stands out and that people love.

(Not despite it tasting awful, but because of it.)

Commodity vs Unique

First: Uber drivers are a commodity.

You don't really care which one you get. You just want to get somewhere quickly, safely, and cheaply.

Airbnbs are unique.

The unique properties of an Airbnb make or break a vacation. You really care which Airbnb you’re staying in.

(Ask yourself: If a stranger booked an Airbnb for you—wouldn’t you be worried?)

As a commodity, you can only compete on:

1. Price (cheaper?)

2. Availability (now?)

3. Quality (better made?)

4. Brand (do they like you better?)

5. Marketing (do you sell it better?)

Whether they decide to buy from you depends on each individual's weighting of 👆 that specific day.

For example

If you sell plumbing supplies, and someone desperately needs those supplies TODAY then they'll compromise on cost, brand, and quality for immediate availability.

They'll optimize for something else if it's not a rush.

Just like if you’re desperately trying to make it home for Christmas, you’d book an absurdly expensive flight with your most hated airline and even sit in a middle seat.

If unique: you compete on way more metrics.

Each Airbnb competes over:

1. Location

2. “Coolness” or “Vibe”

3. Price

4. # of bedrooms/bathrooms/beds

5. Where the beds are located

6. Decor

7. Accessibility

8. Amenities (hot tub anyone?)

9. Pet policy

10. Ratings + reviews

11. Amenities

12. House style

13. Availability

Again, each person will have different preferences depending on the type of trip their taking. More Airbnbs that are better in various ways can be added to the market, but some people will still choose you because they value your unique combination of variables more than others.

But the thing that will guarantee you bookings is if you’re super unique:

Basically what I’m trying to say here is:

Do not launch a commodity, be unique

Often it becomes a race to the bottom in prices. And it's a constant battle to maintain. You can be undercut if someone figures out a process that's faster or better than you.

Examples:

1. Ghostwriter/Copywriter/Artists/Designers/Ads Marketers/Programmers

If you offer the same old services above as everyone else, if someone else can leverage AI to create content, they can charge less and deliver faster.

2. Miners/Manufacturers/Suppliers

If someone else can extract raw materials, or create finished products faster and cheaper, they can charge less or deliver faster.

It's very difficult to penetrate a market and defend your position as a commodity.

Coca-Cola

Coca-Cola has dominated the ultimate commodity arena for a long time. How?