A Superior Customer Experience beats the Vortex of Commoditization

“Across industries we’re approaching the ‘Vortex,’ a feature horizon whereby winning customers and growing business is no longer a function of new features but something else entirely. Filled with accessible and thought-provoking examples, The Customer Experience Revolution demonstrates how organizations both large and small must engage with their customers to prevent commoditization and sustain a healthy bottom line.”

—Darryl Kuhn, Chief Technology Officer, Skinit

The Vortex is the strong current in a market that demands that competitors add more features and capabili­ties while profit margins shrink. The Vortex is efficient at making commodities of anything it can pull in. The strong current of the Vortex demands that changes in products or services occur more often and in smaller time periods. The distinctions between competitors’ prod­ucts in the minds of customers are rapidly erased along with the participating com­panies’ profitability. Frequently, compa­nies see no other way to compete and pre­serve value than to out-feature the com­petition. They may call it an “upgrade,” but often the profits from the product go everywhere except up.

Developing and delivering a superior customer experience is a key way for a company to stay out of the Vortex. In their 1999 book, The Experience Economy: Work Is Theater & Every Business a Stage, B. Joseph Pine II and James H. Gilmore predicted the importance of customer experience to today’s economy:

“In an age of commoditization where most products and services are undifferentiated, consumers shift their focus from prod­uct and service attributes to the experience obtained while using the product or service. The more relevant and memorable the experience, the higher the value, the higher the worth, the higher the price that can be charged.”

When a product becomes commoditized, re-thinking the customer experience with the product will be far more valuable for retaining and building new customers than adding expensive new features.