Industry Convergence: Avoid Copy-Cat Strategy by Innovating

copycat Industry Convergence: Avoid Copy Cat Strategy by Innovating

Convergence in industry has led to many false dawns, but has also offered benefits such as convenience, innovation and increased choice. Which applies to you will be determined by how innovative you can be. Take these examples of convergence which display the positive and negative results that can result: the latter first.

The Australian Wine Industry

At one time the Australian wine industry was respected as providing quality products, but these products are now marketed as promotional items. Practically every Australian wine industry has being doing this for the last 10 years and, because of the demand for their inexpensive products, have fooled themselves into believing they have been pursuing a winning strategy. In fact, what this strategy convergence has resulted in is a product regarded as a commodity, with a reducing demand and a lack of investment in brand. As a result, industry margins are under almost intolerable pressure because they can no longer command the quality prices they once did.

The Music Industry and CDs

The same thing happened with strategy convergence with CDs, and they too are a commodity, generally available free as a promotional item. However, unlike the wine industry, the music industry has recognized this and musicians now sell concerts. It won’t be long till they follow Pearl Jam’s initiative of selling recordings of their live concerts, and allowing people to relive the experience. Innovation is taking them out of the commodity trap.

Information Products

It has been known for years by consultants and speakers that info-products rarely sell in isolation, but disappear rapidly at presentations and similar events. You can approach this in one of two ways: wait for such an event before promoting your information products, or organize such an event in order to promote them. Which is the more proactive? Which strategy will win?

There is something in common with each of these latter two examples. A market was created by seeking associated products or generating marketing opportunities for existing products that would not otherwise sell.

What is to be learned from these cases? Keep your eyes open and avoid the commodity trap through innovation in your marketing. Look for the spin-off and that might be your next major product. It could certainly be the saving of your business.

Industry Convergence: Avoid Copy Cat Strategy by Innovating