Category Innovation

Ken Kusunoki () and Satoshi Akutsu
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Ken Kusunoki: Hitotsubashi University
Satoshi Akutsu: Hitotsubashi University

Chapter Chapter 8 in Dynamics of Knowledge, Corporate Systems and Innovation, 2010, pp 191-208 from Springer

Abstract: Abstract The essence of commoditization lies in the reduction of the value of a product or service to the single, most visible dimension through competition; namely, that of price. We assume that commoditization can be controlled by intentionally lowering the visibility of the value dimension and configuring conditions under which is difficult to make comparisons with competing products. Such an assumption emphasizes the importance of “invisible differentiation”, differentiation in invisible value dimensions, as an effective strategy for de-commoditization. In practice, however, it is difficult for companies to realize such invisible differentiation. There is a natural tendency to direct efforts and resource allocation toward innovation in dimensions with great visibility, which drives companies to the ironic paradox that the very effort to overcome commoditization through innovation instead actually promotes commoditization. This chapter calls it the “visibility trap”, and examines the consequence where “innovative” and “differentiated” products rather intensify commoditization. We will also discuss some implications for de-commoditization strategies through invisible differentiation.

Keywords: Visible Dimension; Sound Quality; High Visibility; External Context; Dominant Design (search for similar items in EconPapers)
Date: 2010
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-642-04480-9_8

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DOI: 10.1007/978-3-642-04480-9_8

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