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A product has become ordinary when a rival sells the same thing, to the same customer, at a price you cannot match on cost, and the customer knows it. It is not a judgment on the product. What has changed is that the thing you charge for no longer carries the price, and by the time it reaches an agenda the product has usually been reclassified in the room from the business into a cost problem. The conversation becomes how to defend the premium, because at the ordinary price the product loses money on every unit. That is not the comparison. Holding the premium loses customers, and every customer who leaves takes whatever they bought beyond the product with them: the service, the consumables, the software, the financing, the cash left on account. This pack turns it into three answers and one division. Hold the premium, and a share of customers leave with the product's margin and their share of the complement. Price the product at the ordinary price, and every customer stays. Let the product go, and you keep only what survives without it. The point where holding and giving away are equal is the break-even complement, what a customer must earn you beyond the product before giving it away pays, and the distance from it to the complement you actually earn is what a board can watch. It stops on six conditions: no price per customer, no product cost, no ordinary price, no complement costed on its own, no figure for how much of it leaves with the product, and no share of customers who would leave if the premium were held.
What is the Commoditization Strategy Pack
The Commoditization Strategy Pack is a complete decision-support kit for one question: what you charge for has become ordinary, so what is left that is not? It is built around one organizing claim: the product's price is not the decision, what the customer still pays you for beyond the product is, and whether that leaves when the product does. Sixteen files carry it: the foundations, a concept deck, a scored decision wizard, a differentiation model blank and worked, the moves at each reading, nine sourced responses, a fit worksheet, a roadmap template, a practitioner manual, a field checklist, and an orientation page.
The test that runs through every file
The product has become ordinary, so the question is what a customer still pays you for beyond it, whether that is worth more than the premium, and whether it leaves when the product does. It is the argument in the deck, it becomes the wizard’s axes, it drives the model’s inputs, and it reappears as lines on the checklist. That is what makes 16 files a product rather than 16 documents.
The model resolves to one number you can negotiate with: The break-even complement — what a customer must earn you beyond the product before giving it away pays. It ships blank and worked, and every input is a named cell rather than a figure buried inside a formula, so the number arrives with its assumptions attached rather than on its own authority.
Why a commoditization strategy starts with the customer, not the price
A product has become ordinary when a rival sells the same thing, to the same customer, at a price you cannot match on cost, and the customer knows it. It is not a judgment on the product. What has changed is that the thing you charge for no longer carries the price. A room notices that at the ordinary price the product loses money on every unit, and the conversation becomes how to defend the premium.
That is not the comparison. Holding the premium loses customers, and every customer who leaves takes whatever they bought beyond the product with them. What a customer earns you beyond the product is reported inside the product's line or across several others, so no one has a per-customer figure. Whether it leaves with the product is a fact about the customer that no one has asked. So the room compares the product's margin to nothing, and defends the price.
This pack turns that into arithmetic. Hold the premium, and a share of customers leave with the product's margin and their share of the complement. Price the product at the ordinary price, and every customer stays. Let the product go, and you keep only what survives without it. Then the whole decision reduces to one figure: the break-even complement, which is what a customer must earn you beyond the product before giving it away pays.
What to do when your product becomes a commodity
| The reading | What it means | The first move |
|---|---|---|
| The product still earns its premium | Few enough leave, or what surrounds the product is thin. | Say how far the distance is, put the ordinary price in the pricing review with a date, and re-run it when the price moves. |
| The product is worth giving away | The customer is worth more than the premium, and most of that leaves with the product. | Price the product at the ordinary price on a date, and move the incentive and the reporting to what surrounds it. |
| The product is worth letting go | What surrounds it does not need it, and it loses money at any price it can charge. | Separate it in the accounts before selling it, and decide the structure of the exit rather than the price. |
| Nothing is left that is not ordinary | A commodity producer, whatever the brand says. | Build a complement, buy one, make the product un-ordinary, or sell the line while it earns. |
Five of the nine sourced cases held, one reversed, one was taken apart, and three have no outcome yet. Only one of the nine defended the product's price, and it did so by changing everything around the product rather than the product.
What is in the Commoditization Strategy Pack
- Foundations. The framework: why ordinary is a price and not a quality, the three answers and one division, the responses on the record, and the six halts.
- Concept deck. Twenty-three slides for a board or a pricing review, with nine sourced responses and what each does not establish.
- Decision wizard. Eight scored questions returning the band, the weakest answer, and either of the two halt conditions.
- Differentiation model. Eleven candidate shares of customers leaving across the columns, the three answers priced, and the break-even complement that decides it.
- Strategies and tactics. The moves at each of the four readings, what to do when the model halts, and four ways to make the next commoditization cheaper to judge.
- Case studies. Nine sourced responses — five held, one reversed, one was taken apart, and three have no outcome yet.
- Fit worksheet. The single page of record: the ordinary price, what the product earns at both prices, the complement, how much of it leaves, and which answer pays.
- Roadmap template. Five phases with gates and owners, the assumptions register, a reporting change and a periodic review line.
- Practitioner manual. The ordinary price, the product's own margin, costing the complement, the leaving file, the board paper, six failure modes.
- Field checklist. The one-pager that survives outside the binder.
- About the package. What each file does and the order in which to run them.
Who the Commoditization Strategy Pack is for
A chief executive whose product has been described as a cost problem for two quarters and costed against the customer for none of them; a chief financial officer being asked to defend a premium against a number no one has produced; a chief commercial officer who knows the rival's price is quoted from memory; a product leader paid on units while the customer's worth sits in three other lines; a board member reading a product margin with nothing beside it; a private equity operating partner underwriting a business whose product is converging on a price it did not set; and the adviser who would otherwise start from a blank page. It is worth buying when a real decision is in front of you. It is not worth buying to read.
An honest note on fit
This is a kit for running a decision, not a research report and not a forecast. Worked examples use an explicitly fictional company with numbers tuned to teach rather than to flatter. In the worked case a device that is two-thirds of revenue loses $4,000 a customer at the ordinary price, which is the fact that gets it onto an agenda. It is not the decision: the customer is worth $30,000 a year beyond the device, 85 percent of that leaves with it, and pricing the device at the ordinary price beats holding the premium by $7.9m a year: the break-even complement is $23,957 a customer against the $30,000 earned. The case rests on two numbers no one has measured, and the Sensitivity tab says in which column it stops holding.
The framework content is the larger share of the pack, and each page marks which is which. Four limits are stated on the page rather than worked around. The model applies the share of customers who leave from the first year of the term, which overstates the loss early and understates it late. It does not forecast the ordinary price, which in the cases only ever fell. It does not price the multiple the market puts on a company that has let its ordinary business go. And it treats the complement as a fixed figure per customer, when in Schwab's case it swung with interest rates by a third in one year. The cases hold no example from steel, memory, airlines, or telecommunications, and nothing is asserted about them.
Questions about the Commoditization Strategy Pack
- What numbers does the model produce?
- One headline and thirteen supporting rows. The break-even complement, which is what a customer must earn you beyond the product before giving it away pays, and the distance from it to the complement you actually earn. Around them: the premium over the ordinary price, what the product earns at your price and at the ordinary price, the complement as a share of what a customer earns you, the three answers priced a year and over the term, which of them pays most, how much of the complement would have to leave with the product for the answer to change, and the premium at stake as a share of revenue and in years of profit. The Model tab sweeps the share of customers who leave, and one row turns from No to Yes at the point where giving the product away pays.
- Our product loses money at the competitor's price. Should we cut?
- Not on that fact alone, and that is the whole point of the pack. The product's margin and the customer's worth are different questions. In the worked case a device that loses $4,000 a customer at the ordinary price is still worth selling at that price by $7.9m a year, because the customer is worth $30,000 a year beyond the device and 85 percent of that leaves with it.
- We don't know what our customers buy beyond the product.
- Most companies do not, because it is reported inside the product's line and the manual sets out the five places it hides. It is a week with the sales ledger, and until it exists the room is defending a margin that has nothing beside it.
- Does this only apply to hardware?
- No. It applies wherever a product has become ordinary and something surrounds it: a trade and the cash on account, a machine and the data platform, a model and the tooling that adapts it, a medicine and its patent, a can and the meaning around it. Four of the nine cases are services or software rather than things.
- Are the case studies real companies?
- Yes. Nine sourced responses: Charles Schwab, IBM, Dow, Robinhood, Thinking Machines Lab, John Deere, Pfizer, HP, and Red Bull. Each is dated and read through what became ordinary and what the company did, and each states what its evidence does not establish. Three have no outcome yet, and the pages that use them say so. The worked model, wizard, and worksheet use an explicitly fictional company, labeled as such on every file.
- Is this a subscription?
- No. One payment, one download, sixteen files, yours to keep and to use inside your organization under the license included in the pack.
- What is the Commoditization Strategy Pack?
- The Commoditization Strategy Pack is a decision-support kit for one question: What you charge for has become ordinary; what is left that is not? It contains 16 files — foundations, concept deck, decision wizard, differentiation model, strategies and tactics, case studies, fit worksheet, roadmap template, practitioner manual, field checklist, about the package — built around a single organizing test: the product has become ordinary, so the question is what a customer still pays you for beyond it, whether that is worth more than the premium, and whether it leaves when the product does. It is what a leadership team uses to run the decision and leave a record of what they assumed, rather than a report about the topic.
- Who is the Commoditization Strategy Pack for?
- Anyone who has to make this call and answer for it: an operator or owner facing the decision, the executive team running it, the board or investor testing the reasoning, or an adviser who would otherwise build the framework from a blank page. It is worth buying when a real decision is in front of you. It is not worth buying to read.
- What is in the Commoditization Strategy Pack?
- 16 files in Word, PDF, PowerPoint and Excel: Foundations (Word + PDF) — The framework: why ordinary is a price and not a quality, the three answers and one division, the responses on the record, and the six halts. Concept deck (PowerPoint + PDF) — Twenty-three slides for a board or a pricing review, with nine sourced responses and what each does not establish. Decision wizard (Excel) — Eight scored questions returning the band, the weakest answer, and either of the two halt conditions. Differentiation model (Excel, blank and worked) — Eleven candidate shares of customers leaving across the columns, the three answers priced, and the break-even complement that decides it. Strategies and tactics (Word) — The moves at each of the four readings, what to do when the model halts, and four ways to make the next commoditization cheaper to judge. Case studies (Word) — Nine sourced responses — five held, one reversed, one was taken apart, and three have no outcome yet. Fit worksheet (Word, blank and worked) — The single page of record: the ordinary price, what the product earns at both prices, the complement, how much of it leaves, and which answer pays. Roadmap template (Word) — Five phases with gates and owners, the assumptions register, a reporting change and a periodic review line. Practitioner manual (Word + PDF) — The ordinary price, the product's own margin, costing the complement, the leaving file, the board paper, six failure modes. Field checklist (PDF) — The one-pager that survives outside the binder. About the package (PDF) — What each file does and the order in which to run them.
- How is the Commoditization Strategy Pack delivered?
- As a single download of all 16 files, immediately after payment, with the same link sent by email. It can be downloaded 3 times and the link is valid for 30 days. There is nothing to install and no account to keep.