IDEAS home Printed from https://ideas.repec.org/a/eee/ijrema/v27y2010i2p188-197.html
   My bibliography  Save this article

Toward an understanding of industry commoditization: Its nature and role in evolving marketing competition

Author

Listed:
  • Reimann, Martin
  • Schilke, Oliver
  • Thomas, Jacquelyn S.

Abstract

This paper aims to improve current knowledge on the commoditization of industries, a unique phenomenon of evolving marketing competition characterized by increasing homogeneity of products, higher price sensitivity among customers, lower switching costs, and greater industry stability. As commoditization is relevant to an ever-greater number of diverse industries, this research addresses two main questions: (1) How can managers assess their industry's level of commoditization to be better informed about their firm's competitive environment? and (2) How does the level of commoditization in an industry affect the effectiveness of marketing strategies? Initially, in-depth field interviews identified the characteristics of the commoditization phenomenon. Subsequently, a survey study among 141 companies from ten industries applied a measure to assess an industry's commoditization level. The results showed significant differences between high and low commodity markets in terms of the impact of three different strategic orientations on firm performance. The application of the value disciplines framework revealed that as commoditization increases, operational excellence and product leadership lose impact, while customer intimacy becomes a more vital performance driver. The results indicate that commoditization assessment may become a vital part of a firm's strategic efforts to address evolving marketing competition.

Suggested Citation

  • Reimann, Martin & Schilke, Oliver & Thomas, Jacquelyn S., 2010. "Toward an understanding of industry commoditization: Its nature and role in evolving marketing competition," International Journal of Research in Marketing, Elsevier, vol. 27(2), pages 188-197.
    • Handle: RePEc:eee:ijrema:v:27:y:2010:i:2:p:188-197
    DOI: 10.1016/j.ijresmar.2009.10.001
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0167811609000858
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.ijresmar.2009.10.001?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Suresh Kotha & Bhatt L. Vadlamani, 1995. "Assessing generic strategies: An empirical investigation of two competing typologies in discrete manufacturing industries," Strategic Management Journal, Wiley Blackwell, vol. 16(1), pages 75-83.
    2. Leeflang, P.S.H. & Wittink, Dick R., 2000. "Building models for marketing decisions: past, present and future," Research Report 00F20, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
    3. Lichtenstein, Donald R & Bloch, Peter H & Black, William C, 1988. "Correlates of Price Acceptability," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 15(2), pages 243-252, September.
    4. repec:dgr:rugsom:00f20 is not listed on IDEAS
    5. Armstrong, J. Scott & Overton, Terry S., 1977. "Estimating Nonresponse Bias in Mail Surveys," MPRA Paper 81694, University Library of Munich, Germany.
    6. Wolfgang Ulaga, 2001. "Customer Value in Business Markets: An Agenda for Inquiry," Post-Print hal-00485122, HAL.
    7. John Hulland, 1999. "Use of partial least squares (PLS) in strategic management research: a review of four recent studies," Strategic Management Journal, Wiley Blackwell, vol. 20(2), pages 195-204, February.
    8. Wolfgang Ulaga & Samir Chacour, 2001. "Measuring Customer-Perceived Value in Business Markets: A Prerequisite for Marketing Strategy Development and Implementation," Post-Print hal-00485109, HAL.
    9. Becker, Jan U. & Greve, Goetz & Albers, Sönke, 2009. "The impact of technological and organizational implementation of CRM on customer acquisition, maintenance, and retention," International Journal of Research in Marketing, Elsevier, vol. 26(3), pages 207-215.
    10. Wynne W. Chin & Barbara L. Marcolin & Peter R. Newsted, 2003. "A Partial Least Squares Latent Variable Modeling Approach for Measuring Interaction Effects: Results from a Monte Carlo Simulation Study and an Electronic-Mail Emotion/Adoption Study," Information Systems Research, INFORMS, vol. 14(2), pages 189-217, June.
    11. Davis, Peter S. & Schul, Patrick L., 1993. "Addressing the contingent effects of business unit strategic orientation on relationships between organizational context and business unit performance," Journal of Business Research, Elsevier, vol. 27(3), pages 183-200, July.
    12. Slater, Stanley F. & Olson, Eric M. & Reddy, Venkateshwar K., 1997. "Strategy-based performance measurement," Business Horizons, Elsevier, vol. 40(4), pages 37-44.
    13. J. Yannis Bakos, 1997. "Reducing Buyer Search Costs: Implications for Electronic Marketplaces," Management Science, INFORMS, vol. 43(12), pages 1676-1692, December.
    14. Sharma, Arun & Sheth, Jagdish N., 2004. "Web-based marketing: The coming revolution in marketing thought and strategy," Journal of Business Research, Elsevier, vol. 57(7), pages 696-702, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sakiyama, Ryo & Dony Dahana, Wirawan & Baumann, Chris & Ye, Mingqi, 2023. "Cross-industrial study on satisfaction-commitment-PWOM linkage: The role of competition, consumption visibility, and service relationship," Journal of Business Research, Elsevier, vol. 160(C).
    2. Worm, Stefan & Srivastava, Rajendra K., 2014. "Impact of component supplier branding on profitability," International Journal of Research in Marketing, Elsevier, vol. 31(4), pages 409-424.
    3. Arjen van Witteloostuijn & Nele Cannaerts & Wim Coreynen & Zainab Noor el Hejazi & Joeri van Hugten & Ellen Loots & Hendrik Slabbinck & Johanna Vanderstraeten, 2020. "Co-Creative Action Research Experiments—A Careful Method for Causal Inference and Societal Impact," Social Sciences, MDPI, vol. 9(10), pages 1-28, September.
    4. Roelen-Blasberg, Tobias & Habel, Johannes & Klarmann, Martin, 2023. "Automated inference of product attributes and their importance from user-generated content: Can we replace traditional market research?," International Journal of Research in Marketing, Elsevier, vol. 40(1), pages 164-188.
    5. Anes Hrnjic, 2016. "The transformation of higher education: evaluation of CRM concept application and its impact on student satisfaction," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 6(1), pages 53-77, April.
    6. Ryari, Hanaa & Alavi, Sascha & Wieseke, Jan, 2021. "Drown or Blossom? The Impact of Perceived Chronic Time Pressure on Retail Salespeople's Performance and Customer–Salesperson Relationships," Journal of Retailing, Elsevier, vol. 97(2), pages 217-237.
    7. Balci, Gökcay & Cetin, Ismail Bilge & Tanyeri, Mustafa, 2018. "Differentiation of container shipping services in Turkey," Transport Policy, Elsevier, vol. 61(C), pages 26-35.
    8. Ilse Svensson de Jong, 2021. "Misfit? The Use of Metrics in Innovation," JRFM, MDPI, vol. 14(8), pages 1-20, August.
    9. Pierre-Jean Benghozi & Elisa Salvador, 2015. "Technological competition: a path towards commoditization or differentiation? Some evidence from a comparison of e-book readers," Post-Print hal-02080207, HAL.
    10. Dmytro Osiichuk & Paweł Wnuczak, 2023. "Do Corporate Consolidations Affect the Competitive Positioning of Non-Financial Firms in China?," SAGE Open, , vol. 13(4), pages 21582440231, December.
    11. Hinterhuber, Andreas, 2016. "The six pricing myths that kill profits," Business Horizons, Elsevier, vol. 59(1), pages 71-83.
    12. Morimura, Fumikazu & Sakagawa, Yuji, 2018. "Information technology use in retail chains: Impact on the standardisation of pricing and promotion strategies and performance," Journal of Retailing and Consumer Services, Elsevier, vol. 45(C), pages 81-91.
    13. Antje S. J. Hütten & Torsten Oliver Salge & Thomas Niemand & Florian U. Siems, 2018. "Advancing relationship marketing theory: exploring customer relationships through a process-centric framework," AMS Review, Springer;Academy of Marketing Science, vol. 8(1), pages 39-57, June.
    14. Coreynen, Wim & Vanderstraeten, Johanna & van Witteloostuijn, Arjen & Cannaerts, Nele & Loots, Ellen & Slabbinck, Hendrik, 2020. "What drives product-service integration? An abductive study of decision-makers’ motives and value strategies," Journal of Business Research, Elsevier, vol. 117(C), pages 189-200.
    15. Mohammed Alamgir & Mohammad Shamsuddoha, 2015. "Customer Relationship Management (Crm) Success Factors: An Exploratory Study," EcoForum, "Stefan cel Mare" University of Suceava, Romania, Faculty of Economics and Public Administration - Economy, Business Administration and Tourism Department., vol. 4(1), pages 1-7, January.
    16. Zhong, Huiling & Zhang, Fa & Gu, Yimiao, 2021. "A Stackelberg game based two-stage framework to make decisions of freight rate for container shipping lines in the emerging blockchain-based market," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 149(C).
    17. Ivens, Björn & Kasper-Brauer, Kati & Leischnig, Alexander & Thornton, Sabrina C., 2024. "Implementing customer relationship management successfully: A configurational perspective," Technological Forecasting and Social Change, Elsevier, vol. 199(C).
    18. Wim Coreynen & Arjen van Witteloostuijn & Johanna Vanderstraeten, 2021. "Toward Servitized Research: An Integrated Approach for Sustainable Product-Service Innovation," Sustainability, MDPI, vol. 13(15), pages 1-21, July.
    19. Elen Riot & Cécile Chamaret & Emmanuelle Rigaud, 2013. "Murakami on the bag: Louis Vuitton's decommoditization strategy [Murakami sur le sac]," Post-Print hal-02883097, HAL.
    20. Vomfell, Lara & Stahl, Florian & Schomm, Fabian & Vossen, Gottfried, 2015. "A classification framework for data marketplaces," ERCIS Working Papers 23, University of Münster, European Research Center for Information Systems (ERCIS).
    21. Laurent Tournois, 2016. "A Manager-Customer Empirical Investigation Of The Subjective Performance Of Proactive Market-Oriented Consumer Goods Companies: Testing A Double-Mediation Model," Post-Print hal-04477573, HAL.
    22. Sebastian Brenk & Dirk Lüttgens & Kathleen Diener & Frank Piller, 2019. "Learning from failures in business model innovation: solving decision-making logic conflicts through intrapreneurial effectuation," Journal of Business Economics, Springer, vol. 89(8), pages 1097-1147, December.
    23. Singh, Neeraj & Kumar, Niraj & Kapoor, Sanjeev, 2022. "Consumer multihoming predisposition on food platforms: Does gender matter?," Journal of Retailing and Consumer Services, Elsevier, vol. 67(C).
    24. Reinhardt, Ronny & Gurtner, Sebastian, 2018. "The overlooked role of embeddedness in disruptive innovation theory," Technological Forecasting and Social Change, Elsevier, vol. 132(C), pages 268-283.
    25. Leischnig, Alexander & Kasper-Brauer, Kati, 2016. "How to sell in diverse markets? A two-level approach to industry factors and selling factors for explaining firm profitability," Journal of Business Research, Elsevier, vol. 69(4), pages 1307-1313.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kawai, Norifumi & Chung, Chul, 2019. "Expatriate utilization, subsidiary knowledge creation and performance: The moderating role of subsidiary strategic context," Journal of World Business, Elsevier, vol. 54(1), pages 24-36.
    2. Wu, Jen-Her & Kao, Hao-Yun & Sambamurthy, Vallabh, 2016. "The integration effort and E-health compatibility effect and the mediating role of E-health synergy on hospital performance," International Journal of Information Management, Elsevier, vol. 36(6), pages 1288-1300.
    3. Arnold Kamis & Tziporah Stern & Daniel M. Ladik, 2010. "A flow-based model of web site intentions when users customize products in business-to-consumer electronic commerce," Information Systems Frontiers, Springer, vol. 12(2), pages 157-168, April.
    4. Maiga, Adam S. & Nilsson, Anders & Ax, Christian, 2015. "Relationships between internal and external information systems integration, cost and quality performance, and firm profitability," International Journal of Production Economics, Elsevier, vol. 169(C), pages 422-434.
    5. Richard, James E. & Purnell, Fruen, 2017. "Rethinking Catalogue and Online B2B Buyer Channel Preferences in the Education Supplies Market," Journal of Interactive Marketing, Elsevier, vol. 37(C), pages 1-15.
    6. Ismael Barros-Contreras & Héctor Pérez-Fernández & Natalia Martín-Cruz & Juan Hernangómez B., 2023. "Can we make family social capital flourish? The moderating role of generational involvement," Journal of Family and Economic Issues, Springer, vol. 44(3), pages 655-673, September.
    7. Arumugam Seetharaman & Saurabh Singhal & Pankaj Galdhar & John Rudolph Raj & A. S. Saravanan, 2016. "Customers’ Expectations for Next Generation Internet Banking," Journal of Information & Knowledge Management (JIKM), World Scientific Publishing Co. Pte. Ltd., vol. 15(01), pages 1-28, March.
    8. Pablo Ruiz-Palomino & Ricardo Martinez-Cañas, 2011. "Supervisor Role Modeling, Ethics-Related Organizational Policies, and Employee Ethical Intention: The Moderating Impact of Moral Ideology," Journal of Business Ethics, Springer, vol. 102(4), pages 653-668, September.
    9. Zhang, Man & Hartley, Janet L., 2018. "Guanxi, IT systems, and innovation capability: The moderating role of proactiveness," Journal of Business Research, Elsevier, vol. 90(C), pages 75-86.
    10. Malte Brettel & Andreas Engelen & Thomas Müller & Oliver Schilke, 2011. "Distribution Channel Choice of New Entrepreneurial Ventures," Entrepreneurship Theory and Practice, , vol. 35(4), pages 683-708, July.
    11. García-Villaverde, Pedro M. & Ruiz-Ortega, María J. & Parra-Requena, Gloria, 2012. "Towards a comprehensive model of entry timing in the ICT industry: Direct and indirect effects," Journal of World Business, Elsevier, vol. 47(2), pages 297-310.
    12. Mareike Bergmann & Christian Brück & Thorsten Knauer & Anja Schwering, 2020. "Digitization of the budgeting process: determinants of the use of business analytics and its effect on satisfaction with the budgeting process," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 31(1), pages 25-54, April.
    13. Hanna Krasnova & Natasha Veltri & Klaus Spengler & Oliver Günther, 2013. "“Deal of the Day” Platforms: What Drives Consumer Loyalty?," Business & Information Systems Engineering: The International Journal of WIRTSCHAFTSINFORMATIK, Springer;Gesellschaft für Informatik e.V. (GI), vol. 5(3), pages 165-177, June.
    14. Chai, Sangmi & Kim, Minkyun, 2012. "A socio-technical approach to knowledge contribution behavior: An empirical investigation of social networking sites users," International Journal of Information Management, Elsevier, vol. 32(2), pages 118-126.
    15. Wen-Lung Shiau & Yogesh K. Dwivedi, 2013. "Citation and co-citation analysis to identify core and emerging knowledge in electronic commerce research," Scientometrics, Springer;Akadémiai Kiadó, vol. 94(3), pages 1317-1337, March.
    16. Man Zhang & Qian Gao & Hyuk-Soo Cho, 2017. "The effect of sub-national institutions and international entrepreneurial capability on international performance of export-focused SMEs: Evidence from China and South Korea," Journal of International Entrepreneurship, Springer, vol. 15(1), pages 85-110, March.
    17. Oliver Schilke & Bernd W. Wirtz, 2008. "Allianzfähigkeit — Eine Analyse zur Operationalisierung und Erfolgswirkung im Kontext von F&E-Allianzen," Schmalenbach Journal of Business Research, Springer, vol. 60(5), pages 479-516, August.
    18. Asiaei, Kaveh & Jusoh, Ruzita, 2017. "Using a robust performance measurement system to illuminate intellectual capital," International Journal of Accounting Information Systems, Elsevier, vol. 26(C), pages 1-19.
    19. Sirén, Charlotta & Kohtamäki, Marko, 2016. "Stretching strategic learning to the limit: The interaction between strategic planning and learning," Journal of Business Research, Elsevier, vol. 69(2), pages 653-663.
    20. Gupta, Prashant & Seetharaman, A. & Raj, John Rudolph, 2013. "The usage and adoption of cloud computing by small and medium businesses," International Journal of Information Management, Elsevier, vol. 33(5), pages 861-874.

    More about this item

    Keywords

    Marketing strategy; Survey research;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ijrema:v:27:y:2010:i:2:p:188-197. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: https://www.journals.elsevier.com/international-journal-of-research-in-marketing/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.