Welcome to Commodity Hell: The Perils of the Copycat Economy

I'm currently working on a project for Nokia looking at approaches to identify and communicate services.

It's a complicated topic — within Nokia as we have three separate operating systems and nine layers of management between me and the CEO! — and I believe must be treated as a brand architecture challenge not a services and user interface issue which is where ownership currently resides. Why? In my personal opinion the service space is fast becoming commodity hell, the need for a common and identifiable architecture to brand services has become mission critical.

The effects of imitation and commoditization are happening so quickly that we have started taking them for granted. To demonstrate this the issues I'm currently developing a series of short case studies, one of which compares the commoditized wine industry to mobile services and it's making fascinating work.

From a consumer perspective, consumers now feel the same sense of bewilderment felt amongst rows of comparable wine when visiting app stores with hundreds of thousands of apps with incremental differences. Observing brands visual identity design strategies within this space has been really insightful.

Apple iTunes is the service equivalent of 'two buck chuck'

From an innovation perspective commoditised markets have a history of being disrupted by radical new offerings. Oren Harari from FT Press observed that the fastest-growing wine in the history of America's wine industry is Bronco Wine Company's Charles Shaw wine. It is sold at the upscale Trader Joe's grocery chain, its customers are affluent and trendy, and its price is $1.99—hence its affectionate nickname "Two Buck Chuck."

While Charles Shaw might not ever be confused with a vintage collector's wine, it's good enough for the discerning Trader Joe's customer seeking a casual drink. It's certainly good enough to have thoroughly cannibalized the sales of high-priced wines and skewed the industry's entire price structure. Small wonder that a Wine Observer article noted that the "terror of commoditization…is sweeping California's wine producers."

The bottom line? Imitation and commoditization are one of the most pressing strategic challenges that businesses will face for the duration of this decade. What's been useful to me is the rich learning possible by observing how other sectors have risen to meet this challenge.