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Commodity can be defined as anything that is subject to trade or something that can be demanded by buyers, has some economic value and be both tangible and non-tangible.. Consumers demand goods and services which are provided by the sellers and it is these that constitute a commodity. Concept of commodity in the business sense simply means something unique that differentiates itself from others. With the unique features the commodity is able to meet and satisfy consumers’ needs.
The concept of commodity is a recent one which is coming in to replace the concept of power brands (http://www.coolavenues.com/know/mktg/arunashish tanuj 1.php3).
Brands have been used to differentiate and create value for the product. Brand used to give customers assurance of quality, dependability as well as value. With well established brands customers are able to know from which products to choose in order to achieve maximum value for their money. Several examples of power brands can be given to include Coca-cola, Gillette, and Rothman among others.
The new concept of commodity is more likely to bring about more challenges to the present day business management world.
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Challenges that are likely to be witnessed include how to deal with cost leadership, differentiation and price sensitivity driven in the direction of ensuring that commodity is made a brand.
Companies in the effort to make commodity a brand have always and continue to face problems or barriers which are associated with little ability and willingness to pay, lack of sufficient customer knowledge, as well as unclear and latent customer wants.
Marketers often draw strategies that are used to counter these challenges. These include creating awareness on product features, doing enough research to unearth hidden potential wants of customers, and reducing prices so as to accommodate those who are unable to afford high prices.
Faber Castell is moving pencils which are one of its products from the category of “commodity” in order to market this part of their products in a different way. By treating pencils as anon-commodity Faber Castell is trying to create the impression that pencils are not just a commodity but very essential goods that some things or work can not be done without.
Faber Castell is marketing pencils as basic goods and not mere commodities. The main strategy of achieving this removing of pencils from the category of commodity, is by considering consumer behavior and designing pencils that are met with great demand from the customers. Another strategy is giving free samples of best quality pencils to create a good impression in the market place.
Product integrity is the ability or property of goods and services to be free from any corruption or meet fair trade standards. Product integrity therefore encompasses product quality, quantity, reliability, lifetime, and sold in fair market conditions. Product integrity is very important for companies as well as for consumers. First to the company it enhances respect for the company and leads to product loyalty by customers. This is a plus for the company because it is assured of sustained growth and earning of higher profits. To the consumers, they are always aware and expect quality goods and services which continually satisfy the value for money.
Product integrity is also important for the customer because he/ she is able to get quality goods and services consistently and reliably from the producing companies. Creating product integrity also involves keeping prices at affordable levels and avoiding participation in black market business. Product integrity also calls for companies not to participate in cartels that exploit consumers.
The strategies used by Faber Castell to achieve product integrity include research into customer requirements. This is critical as it will allow for right products to be produced for the customers. The other strategy is charging fair prices for products in order to attract many customers. Participation in anti-competition practices campaign by regulatory bodies. It is a binding rule of fair trade and competition that necessitate the importance of product integrity (http://www.sei.cmu.edu/productlines/frame_report/devel.imp.AS.htm).
The above mentioned strategies have worked wonders for Faber Castell as it commands a great part of the market share where it operates. Product loyalty is high among its customers because of the strategies laid down to protect and enhance product integrity. To fully embrace the concept of “commodity” organizations integrity, marketers have to understand how this fits in the modern day business and strategize on how to frame it to receive maximum acceptance from the consumers. The other thing in this process is to adhere to product integrity protection and enhancement to create customer loyalty for the new concept of “commodity”. This calls for a clear understanding of the changing needs of customers and coming up with the right products that are sold in the market using the right trade practices.
Commodity Requirements at Faber Castell Company. (2020, Jun 01). Retrieved from https://studymoose.com/commodity-requirements-at-faber-castell-company-essay
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