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In business literature, commoditization is defined as the process by which goods that have economic value and are distinguishable in terms of attributes (uniqueness or brand) end up becoming simple commodities in the eyes of the market or consumers. It is the movement of a market from differentiated to undifferentiated price competition and from monopolistic competition to perfect competition. Hence, the key effect of commoditization is that the pricing power of the manufacturer or brand owner is weakened: when products become more similar from a buyer's point of view, they will tend to buy the cheapest.
This is not to be confused with commodification, which is the concept of objects or services being assigned an exchange value which they did not previously possess by their being produced and presented for sale, as opposed to personal use. One way to summarize the difference is that commoditization is about proprietary things becoming generic, whereas commodification is about nonsaleable things becoming saleable. In social sciences, particularly anthropology, the term is used interchangeably with commodification to describe the process of making commodities out of anything that was not available for trade previously.[1][2]
Commoditization can be the desired outcome of an entity in the market, or it can be an unintentional outcome that no party actively sought to achieve. (For example, see Xerox#Trademark.)
According to Neo-classical economic theory, consumers can benefit from commoditization, since perfect competition usually leads to lower prices. Branded producers often suffer under commoditization, since the value of the brand (and ability to command price premiums) can be weakened.
However, false commoditization can create substantial risk when premier products do have substantial value to offer, particularly in health, safety and security.
See also
[edit]References
[edit]- ^ Appadurai, Arjun, ed. (1986). The Social Life of Things: Commodities in a Cultural Perspective. Cambridge UP, Cambridge.
- ^ Greenwood, D.J. (1977). "'Culture by the Pound: An Anthropological Perspective on Tourism as Cultural Commoditization". In Hosts and Guests, ed. V. L. Smith, pp. 129-139. Philadelphia: University of Pennsylvania Press.
Well, that’s interesting to know that Psilotum nudum are known as whisk ferns. Psilotum nudum is the commoner species of the two. While the P. flaccidum is a rare species and is found in the tropical islands. Both the species are usually epiphytic in habit and grow upon tree ferns. These species may also be terrestrial and grow in humus or in the crevices of the rocks.
View the detailed Guide of Psilotum nudum: Detailed Study Of Psilotum Nudum (Whisk Fern), Classification, Anatomy, Reproduction