I love the ease with which marketing-guru Seth Godin communicates vital concepts. In a recent blog A Paradox of Expectations he writes:
Better than expected might be the level of quality that’s necessary to succeed.
Of course, once that becomes the standard, the expectation is reset.
The basis of competition has shifted to business models because features and benefits of individual products and services have become so easy to copy. But even business model value promises are subject to the Paradox of Expectations.
So how does a leader stay ahead of the commoditization curve?
Follow my Ten Commandments for staying out of commodity market quicksand. They form the epilogue of my book about business model innovation, Beyond Price: Differentiate Your Company in Ways that Really Matter.
Practice these behaviors in the next year and you’ll better fulfill your unique and highest value role as a leader: innovating your business model.
- You must change the rules for how your market works, because if you don’t, a smarter competitor will.
- Never forget that all purchase decisions are based on perceived value. Being differentiated in ways that offer customers benefits and reduce their indirect costs increases your perceived value.
- Build your market understanding process into a strategic advantage.
- Build a core competency that is hard to replicate or a market position that is hard for others to enter. Being first into a new category and succeeding from the start is a good indicator that you have accomplished just this.
- Focus on the real competition—the marketplace—not your peers.
- Honor your strategic customers and build your company around them. Not all customers or market segments are strategic.
- Never conduct your strategic assessment at the start of budget cycle.
- Invest in your personal growth as a leader and as a leadership team. The capacity of your company to change will depend on it.
- Live your purpose, vision and guiding principles. They determine whether people show up every day with passion or in pursuit of a paycheck.
- Keep improving your value proposition and aligning everything to it. At the same time, be ready to create an entirely different business model before the current one is copied by your competition.
I look forward to another year of bringing fresh business model strategy insights and examples to my readers. Happy New Year!