Beating the Commodity Magnet

Case Solution

V. Kasturi Rangan, George Bowman
Harvard Business School ()

All markets follow a cycle of growth and maturity, after commodification and decline. This note argues that while the commodification of an industry seems inevitable, the best-run companies find a way to make money in the commodity cycle. These companies know how and when to differentiate their products through innovation, service and alliances with customers; and how and when to offer a “nofrills” product and strive for cost leadership. Four of these strategic options are described and discussed in detail. A rewritten version of a previous note.

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