relationships go to hell...somewhere...sometime...

This subject seems to come up again and again: Low Cost companies vs. Differentiation.
this time at Harvard Business Review

Says Prof. Kumar: My research suggests that if a business gets a customer to buy its products or services on the basis of price, it will lose the customer only if a rival offers a lower price.

Well, you gotta be a prof to write this. LOL.

Further: ...Many companies find it tough to persuade consumers to pay for additional benefits. A small premium for greater services or benefits is a powerful defense...

I am not sure, what is new...? As soon as markets are getting mature, the products become more and more 'commodity-like'. The more commodity-like the market is, the less tools are available to make the customer to pay for the additional services. In some cases, the customer might not even need these extra's. Other point is that in commodity like market, the consumers don't really need a relationship. Why do they need it? Relationships help when there is uncertainty, which is in a greater degree presented in the new and emerging markets.

The same topic was discussed at Shop Talk.


low cost differentiation strategy