Commodities are a brand’s best friend
Given that we now live in a global economy increasingly rich in commodity-level products, this might be a good time to reassess the relationship between brands and commodities. Although it’s popular to paint brands and commodities as polar opposites, if not mortal enemies, that hardly seems the case if you examine their relationship. Great brands are built on the shoulders of commodities. There’s actually a strong dialectic between the two that can lead to better brands, and better profits.
Instead of condemning commodities as the scourge of brands, brand builders should treat commodities as a brand’s best friend. Stand the conventional assumption on its head. The trick is knowing how to use commodities to create winning forms of brand value.
There’s nothing wrong with commodities
There’s nothing inherently wrong with commodities. Rich, ripe, rampant commodities are a foundation of global wealth. Thanks to commodities, the world is infinitely better off. Commodities are the grains of silica morphed into $2000 designer chips, or the $2 chips that run our toys. They’re the Arabica beans that power your espresso. They’re the junk cars shipped to Asia that return as a mini-fridge for your daughter at college. They’re also new digital technologies that collapse the barriers between companies and their customers—at a rock-bottom cost inconceivable to brand builders a decade ago.
Commodities frame the brand challenge
The essential brand challenge is to deliver more customer value than mere commodities can provide. To do so, brands must make deep customer connections and actively advance customers to new ways of being and doing—things that commodities alone cannot accomplish.
There are three keys to this process:
- Your ability to see commodities as opportunities
- Your ability to innovate on customer value
- Your ability to create customers with lives too deep for “commodity thinking.”
This is a task for brand platforms and programs, rather than brand campaigns.
Commodities are the building blocks of brands
In the hands of a smart brand builder, commodities are the building blocks of brands. Commodity elements are especially 
useful in building brand platforms. Just as cheap gasoline made possible the mass market auto industry (and also made markets for suburbs, shopping malls, fast food, etc.) there are
thousands of forms of commodity value just waiting to be wrapped in brand imagination, and made into customers.
Ikea is a good example of a brand built from commodity components. When you visit an Ikea store, Ikea’s thoughtful supply of free (commodity) pencils helps make your shopping more efficient—and more pleasurable.
Brand builders, commodities and customers
As I see it, here is how brand builders fit into the big picture of commodity value:
- Give a capitalist a commodity and you’ll get a market.
- Give a businessman a commodity and you’ll get a product.
- Give a brand builder a commodity and you’ll get a customer.
Commodities are brand opportunities
What separates the brand builder from the first two is that the brand builder works through the customer to create value. A brand builder views commodities as brand opportunities. He or she will use commodity elements to make his or her customers more capable and more complete, with greater freedoms, creating market headroom for products now in the pipeline.
Brand builders understand that your customers are your best defense against commodities. Keep your customers moving forward, and commodity-level competitors will never catch up.
For some examples of how innovating on value and creating customers can make use of commodity elements, check out these links for Starbucks, “soft brand indie hotels,” and the origin of the iPod.
Look behind the “commodity threat”
Brands that feel “threatened by commodities” are often more threatened by their own lack of imagination. Companies that innovate in their products, and in their brands, rarely find themselves in commodity traps.