Chapter 2. How and Why Brands Become Homogenized

In every category, it's virtually inevitable that the brands (and companies that market them) will become more and more alike. In the seamlessly connected world of digital communications, this phenomenon is both accelerated and exaggerated. Studies show that an increasing number of categories are becoming more commodity-like in the eyes of consumers. In categories ranging from insurance to legal services, brands are seen as becoming less differentiated.[13]

In mature markets, competition drives up quality and convenience to a point where many brands begin to look like commodities. Products and product features are mostly copied rather than invented. Copying is perceived as less risky, and risk is what most humans strenuously seek to avoid. There is, of course, an important difference between real risk and perceived risk; in marketing the real risk is simply copying what other brands do. Copying leads to undifferentiated brands, commoditization of entire categories, and erosion of pricing power.

Copying also diverts companies and brands from doing what they do best and instead puts them on "the long road to unfocus."[14] There is no competitive advantage in doing simply what others do or, worse, attempting to do everything others do.

A general hospital that does a little bit of everything must support a huge staff of various kinds of professionals and a wide variety of equipment and supplies. The result, as Harvard's Clayton Christensen ...

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