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Industrial Sales: Service Commoditization

Improving Your Margin

Find out what to do when your Industrial product or service becomes Commoditized.  We expand on the two options available: 1. Innovate and 2. Develop your Know/Like/Trust/Caring/Friendship.

Industrial Sales Resources:

ActiveCampaign

BombBomb

Industrial Academy

Industrial Dojo

Industrial Talk

Podcast Transcript:

[00:01]                                     The industrial talk podcast go big in just six minutes a day. Building a legacy of success in a rapidly changing industrial market. Well, hi there. Thank you very much for joining the industrial talk podcast. My name is Scott McKenzie and I'm so glad that you are here. Let's get the show on the road. We're going to talk about service, commoditization, service, commoditization.

[00:22]                                     Commoditization is not a word, but it's a word for us to talk about today. So that's where we're going to go through. And if you're in Louisiana, it is Mardi Gras and if you're not in Louisiana, you need to put that on your bucket list of things to do. Come to a parade, two, three, four, whatever you want to and you will not be disappointed and it will be a memory that will last forever. So that's all good. Now we are here at industrial talk, um, dedicated to your success, your industrial success. 100% of what we produce is definitely geared toward you and your Success. And as such, I've got some resources that you once again need to look into. Just look into them. And one of them is ActiveCampaign. And when I talk about ActiveCampaign, that's the CRM system that I use.

[01:09]                                     That creates a lot of ability to be able to understand your market and communicate with your market in a very systematic and automated way. So it's a very powerful tool and it's a must. It's a must tool to use to take you to the next level in your industrial sales, industrial marketing and industrial branding. So that's active campaign. The second one is of course a BombBomb. Now BombBomb is a tool. It's a video email tool that allows you to communicate with your customers and your prospects, your human element. It is very powerful. I use it daily and it has a lot of tools associated with it and you need to look into it as well. Very good people, incredible company, wonderful product. And then go to industrialtalk.com find Industrial Academy. Look around. There's some classes that are courses that are out there that are geared to your success.

[02:11]                                     And, and we're not doing our job if we're not providing content that helps you become a success. And then the last one of course is the Industrial Dojo where all of these ones are going to be located as you. And you can just sort of rifle through all of these podcasts that are dedicated to Industrial Marketing, Industrial Sales, Industrial Branding, and your Success. That's it. I got rid of that. A whole business stuff. We're going to be talking about service commoditization and I'm going to ask this question, ask this question. Um, do you feel in your business, do you feel that you're racing to the bottom? And when I say racing to the bottom, when you have that conversation with your prospect or your customer and you've got a service or a product and you're constantly having to sort of whittle it down your margin, because acme over here has a product that looks similar, smells similar, tastes similar, yet they're going to constantly push down that price of the product.

[03:11]                                     That's a commoditization. And you've got to recognize that if that, if you find yourself in that business, which I have, the Labor business is strictly commoditized and it is a challenging market to make money in. So you've got to figure out whether your services, your products are truly commoditized. Do they separate themselves? Are they innovative? Do you have to have that conversation of, Hey, acne has got the same thing, which I know they do, but how do you take it and go to the next level of innovation? Because once you've figured that out, you've got to have that, that candid conversation is, is our product commoditized and does it, does it solve the problem of our customer? Because the customer's all about, hey, bottom line, I gotta I gotta make sure that I hit my budget and my targets, whatever it might be. They're always going to look at the price.

[04:10]                                     The second thing that you need to consider after, after the, the innovation part is you do, do you find yourself that, are you different? We've been talking specifically about, uh, they're developing that, that marketing sales, industrial persona. We've talked about how to align yourself with customers. How do you align yourself with prospects and, and, and take pride in the fact that you're, you're doing something pretty special in the industrial world because the industrial market is an innovative market. And it, because it's innovative, it's because of the people within the, the market. Now we've talked about that. That's what you bring to the table. You bring the fact that, okay, maybe our product and our services commoditized, but they don't get me, they don't get my passion about your success customer. They don't, you know, they will not bring that to the table. Commoditization is very challenging, but I want to make sure you understand it happens.

[05:18]                                     Does that make sense? Because I've lived it and it's, it's, it's challenging. It's a very difficult struggle and you just gotta be able to say, okay, can I be innovative in my products and solutions? How can I be innovative? How do I change it ever so slightly so that I'm not racing to the bottom and getting the contract knowing full well that I have no margin does that. And so you don't want to be in that. So there are two things, once again, to figure out how to innovate, change it, have that conversation. How much does it cost? How much does it change? You got to do it or you're gonna, you know you're going to go by the wayside. And then two, you need to really embrace what we've been talking about here at the industrial

[06:08]                                     podcasts in this series of go big because bottom line, they know like, and trust you and they care about you, care about them and their friends. They're going to want to do business with you no matter how commoditize your product is. Thank you very much for joining the industrial talk podcast. You can get a hold of me industrialtalk.com period. No more than that. Get in contact with me. I'm here to help and I want to be able to help you. So have a wonderful day. Be Safe as always because we work in, in the industrial market. Thank you. And Happy Mardi Gras.

About the author, Scott

I am Scott MacKenzie, husband, father, and passionate industry educator. From humble beginnings as a lathing contractor and certified journeyman/lineman to an Undergraduate and Master’s Degree in Business Administration, I have applied every aspect of my education and training to lead and influence. I believe in serving and adding value wherever I am called.

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