Got a little time over the Memorial Day weekend to do some reading. I’m not too far into the book “Linchpin” by Seth Godin but I found this passage interesting:
“Consumers are not loyal to cheap commodities. They crave the unique, the remarkable, and the human. Sure you can always succeed for a while with the cheapest, but you earn your place in the market with humanity and leadership. It’s certainly possible for a shopper to buy food more cheaply than they sell it at Trader Joe’s. But Trader’s keeps growing, because the combination of engaged employees, cutting-edge products, and fun brings people back. Even people trying to save a buck.
The cheap strategy doesn’t scale very well, so the only way to succeed is to add value by amplifying the network and giving workers a platform, not by forcing them to pretend to be machines. The fickle nature of price-shopping consumers is bad new for many companies, the companies that tried to be cheap at all costs, because now they must figure out how to make a profit from expensive, unique, disobedient employees.
Those are the only two choices. Win by being more ordinary, more standard, and cheaper. Or win by being faster, more remarkable, and more human.”
I’ve heard the expression, “the person who owns the relationship owns the business”. Do you think this holds true in the fastener industry?
Which companies in the fastener industry are trying to win by “being faster, more remarkable, and more human”?
Great insights, T.S. I have been following Seth Godin since before I even knew it. I started reading his blog and buying his books years ago, and later realized he co-authored some of the Guerrilla Marketing books with the late great Jay Conrad Levinson I read many years earlier. I highly recommend his blog (easy to find, just google “seth”). Every day he posts succinctly about something that can be applied to just about every industry or organization.
Interestingly enough, today he posts about how many of us are “Wasting our technology surplus”. A subject our industry needs to think more about.
As for your current topic from Linchpin, I believe there will always be room for non-price value in any business. Yes, in the fastener business that room is shrinking every year, thanks in part to our technology surplus. The good news is that (until computers become self-aware and take over very function), there will always be room for “being faster, more remarkable, and more human”. And we can do that better every day – also thanks in part to our technology surplus.
The OP and headline should be updated to correct the name of the author from Grodin to Godin. Not trying to be the grammar police but as one who is frequently called Grodin, Golden, Goodwin, etc. it jumped out at me 🙂
Thank you sir. An embarrassing mistake on my part but it is now corrected. The least I could do for the gentleman as I’m using his work!
TS-
Consumer buying habits cross over to present-day business purchasing only for big ticket items. For a commodity such as fasteners in this world of consensus standards, the power of persuasion gets pushed to the back of the line. Fit, form and function, dimensional conformance and mechanical performance are baseline requirements. Availability is key. Price is the tie-breaker. Twenty years ago, a personal preference to do business with this someone rather than that someone might fly, but not anymore. That kind of individualized purchasing parameter is viewed as worthless to the bottom line nowadays and is liable to get a buyer canned. Marketing to business has transcended humanity and gone digital, and it won’t be returning to Earth in our lifetime.
The interesting, and confusing thing for a buyer is that the guy with the lowest price changes. Especially for commodities. For a few months, one company’s prices will be the lowest and then there will be a subtle change. And distributors (at least those paying attention) notice. They’ll tell you…”that guy is killing that guy on Grade 5’s”. As Seth Godin suggested, there is no ability to rest when you are selling on price. The fastener market place notices quickly. I guess you acknowledged that when you called price the “tie breaker”. And availability. Buyers notice “holes in inventory” pretty quickly too.