Nobody wants to be commoditized, but there’s no denying that some things are simply commodities.
We traditionally think of commodities as raw materials with no added value: corn, wheat, iron ore, and petroleum. These commodities are used to make the finished goods we call “products.”
As time goes on, common products become similar to commodities, because they are so widely available and are produced by many competing companies. You could say such products have become “commoditized.” Examples include paper, paint, tires, toothpaste, tables, chairs, etc. And it’s not just tangible products; services can be commoditized too.
Once a product becomes commoditized, it’s extremely difficult to make that product stand out from its competitors. Even more concerning, commoditized products tend to be sold on price. Consumers choose the cheapest version of a commoditized product. This leads to lower profit and slower sales growth.
One of the ways to fight commoditization, and wring out more money from each product, is to crank up the marketing machine. You create a story and mystique to hype up an otherwise mundane product so that people spend a little more on it.
I saw perfect example of that in a hotel bathroom not long ago, and it involved two classically commoditized products: soap and shampoo.
Mounted on the bathroom wall, was a plastic yellow cylinder filled with liquid hand soap. The brand was “Not Soap, Radio.” I hadn’t heard of that brand before, but the packaging was very appealing, so it caught my eye. I then read the messaging on the soap container…
When life gives you one too many lemons and you’ve misplaced your happy place
Lemon + sugar hand wash
Joy inducing? That’s quite a claim for soap. So, I lathered up and washed my hands.
It was unremarkable. Oh, it was good soap, but it was just soap. For all I know, it could have been manufactured in the same plant as 10 other brands.
In the shower, there was a similar cylinder mounted on the wall, but it was blue and had different messaging:
Shampooing with sharks for that competitive edge in work and/or play
Beach + sky blue water shampoo
Upon using it, my opinion was the same as the soap, and my self-confidence was unchanged.
If you’re selling an ordinary consumer product, you resort to marketing in order to stand out.
But what if you’re a commercial real estate broker selling your representation services to a potential client? How do you avoid commoditization? How do you avoid being “just another broker looking for a commission check?”
If you focus on your own attributes as a broker, why your company is so great or the features and benefits of your property marketing system, then you’re a commodity.
On the other hand, if you focus on your prospective client’s desired outcomes and you bring valuable ideas to the discussion, you’re more likely to be viewed as an expert. When clients hire experts, they’re excited, and they don’t mind paying full commission rates.
I have long been fascinated at how some brokers consistently rank atop their company’s leader board, year after year, regardless of any external market conditions. At just about every company I work with, the leading reps are usually the same people each quarter, each year.
Why is that? I supposed talent, intelligence, good looks and a host of other factors could play a role. More likely, the consistent winners do a better job of proving their expertise and then serving as trusted “partners” to their clients.
Such brokers refuse to be seen as commodities.
In order to help brokers prove their value to clients and avoid being commoditized, many CRE firms are using my new Dealmakers virtual sales training program. The curriculum reveals advanced sales prospecting methods specifically adapted to the commercial real estate profession.
This program is only $99 a month for your whole office. All of your agents can use one membership. That makes this CRE training uniquely cost effective.
Sign up right away and start completing the commercial real estate sales lessons as early as today!
For a list of the course modules and descriptions, click HERE.