Why is it that a Starbucks cup of coffee always tastes better than coffee at home? Or, that a 911 Porsche suits my personal style more than a KIA? Coffee is coffee, right? And, isn’t the point of a vehicle to get you from one place to another?Yeah, right!

Okay, what we are talking about here is the perception of value. Value and worth are not necessarily interchangeable. Value is actually a very emotional response to a product or service. Would I spend more on something unique, than something that I can get everywhere…absolutely! Electricity is a commodity. I really don’t care who sells it, I just want it at the lowest price. Gas for my car is another commodity. From one gas station to the next, they pretty much sell the same thing. Give it to me cheap and I’m a happy camper.

Products and services tend to become commodities in mature markets that are flooded with people selling the same thing. To a consumer, there is little difference between one provider and another. Once a product or service loses it’s uniqueness in the eyes of the consumer, price is the only differentiator.

Peter Drucker got it right when he said, “In a commodity market, you can only be as good as your dumbest competitor.” I’d hate to think that my only business edge is a dumb competitor. Although, I have to admit to thinking that my competitor is an idiot on more than one occasion.

While I don’t think that commoditization is running rampant throughout the photography industry, I do see hints of it creeping into some areas. Take the stock image market for example. Every soccer mom with a digital camera thinks she can shoot stock these days. The tremendous volume of images flooding the market has created a lot of price pressure for the guys who have been making a good living at this for a number of years. When you consider the amount stock agencies are willing to pay for an image and the cost of getting to the location, the equipment, lodging, assistants, etc., you have to wonder whether it is worth it. Read More→