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Author: tjbd Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 8767  
Subject: Re: Understanding Commoditized Date: 2/12/2000 9:10 PM
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When a product categoty suffers from that competitive situation, it is said to be a
commodity. Examples are electronic components, computers, light bulbs, paper clips,
and televisions.

Your description was perfectly apt, but your examples then went on to muddy the water.

Milk and gasoline would be ideal examples of commodities. Then there examples such as batteries, which really ARE exactly the same (almost all are made by two companies) and are only differenciated by the degree to which consumers are lead to believe, by clever advertising, that one brand is better than the next.

As for computers, you might be able to say that PC's have been commoditized, but Apple happily has been able to differenciate by ACTUALLY making a product worthy of garnering higher margins. Then coupling that with clever marketing.

PC companies can still add value (with better service or offering a free car wash with each Windows upgrade) just not into the equipment itself.

As for televisions, Rex said it. Sony's are still better than the rest.
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