Every Business Is on a Journey
No company stays in the same place forever. Markets shift, competitors evolve, and customer expectations change. Whether you realize it or not, your business sits somewhere on a continuum—a sliding scale from extinction to distinction.
On one end lies extinction: irrelevance, commoditization, and decline. On the other lies distinction: unique value, customer loyalty, and resilience. The question every leader must ask is: Where are we today—and where are we headed?
The Danger of Commoditization
Harvard professor Theodore Levitt once noted: “There is no such thing as a commodity. All goods and services can be differentiated.” Yet too many companies drift toward commoditization because they fail to invest in distinction.
- Commodities Compete on Price
If your product or service feels interchangeable, customers will choose the cheapest option.
- Commodities Breed Irrelevance
Without differentiation, you disappear in a crowded marketplace.
- Commodities Slide Toward Extinction
History is full of brands that were once leaders but failed to evolve: Borders, BlackBerry, Toys “R” Us.
Why Distinction Matters
Distinct businesses don’t just survive—they thrive. Distinction means:
- Unique Value: Offering something customers can’t get elsewhere.
- Emotional Connection: Customers feel loyalty beyond price.
- Market Leadership: Competitors chase you, not the other way around.
- Resilience: Distinct brands adapt faster during disruption.
Research from Deloitte shows that brands perceived as distinct outperform peers by 3x in customer loyalty and revenue growth.
The Continuum Explained
Think of the continuum as a sliding scale:
- Extinction – Businesses that fail to innovate, adapt, or respond to change.
- Commodity – Businesses offering interchangeable products or services, competing primarily on price.
- Good Enough – Businesses surviving but not thriving, with limited differentiation.
- Distinct – Businesses that stand out through innovation, brand, and customer experience.
Where a company lands depends largely on leadership’s commitment to uncovering new value and creating uniqueness.
Case in Point: Amazon vs. Borders
Borders once dominated bookstores. But while Amazon innovated—first with online shopping, then with e-books—Borders doubled down on physical retail. Within years, Borders was extinct. Amazon, by contrast, became one of the world’s most distinct companies.
Case in Point: Southwest Airlines
In a crowded industry where most carriers felt interchangeable, Southwest Airlines distinguished itself with low-cost fares, a fun culture, and operational efficiency. Customers didn’t just buy flights—they bought into the experience. That distinction built loyalty that still fuels the brand.
How to Move Toward Distinction
- Reframe Problems
Don’t settle for solving surface issues. Ask, “How might we create more value and uniqueness for our customers?”
- Listen to Customers Differently
Customers rarely say, “We want innovation.” They express problems. Distinct businesses uncover those problems and solve them creatively.
- Embrace Innovation as a Discipline
Innovation isn’t luck—it’s a structured process of uncovering value.
- Differentiate Beyond Product
Distinction can come from service, customer experience, brand personality, or business model.
- Avoid the Comfort of “Good Enough”
Good is the enemy of great. Staying comfortable in the middle of the continuum is the fastest way to slide toward extinction.
The CEO’s Role in Driving Distinction
CEOs must recognize that the purpose of business is innovation and marketing (Drucker). Without both, organizations lose relevance. Leadership must:
- Protect resources for long-term innovation.
- Model curiosity and openness to new ideas.
- Reward risk-taking and experimentation.
- Keep asking: “Are we creating distinction—or drifting into commodity?”
The Business Benefits of Distinction
- Pricing Power:Â Customers pay more for unique value.
- Loyalty:Â Distinct brands create emotional bonds.
- Market Leadership:Â Distinct companies set the agenda.
- Sustainability: Distinct businesses endure through disruption.
Actionable Takeaways
- Identify where your business sits today on the extinction-to-distinction continuum.
- Challenge assumptions that your industry is “commoditized.” Differentiation is always possible.
- Use structured innovation to uncover unique value.
- Remember that “good enough” is not a safe place—it’s a dangerous middle ground.
- Build distinction not only in products, but in customer experience and culture.
FAQs
What if our industry is already commoditized?
That’s exactly when innovation matters most. Distinction comes from redefining value in the eyes of the customer.
Can small businesses achieve distinction?
Yes—sometimes more easily. Smaller companies can be nimble, take risks, and deliver personalized experiences.
How do I know if we’re drifting toward extinction?
If customers choose you primarily on price, or if you struggle to explain what makes you unique, you’re sliding toward commodity.
Conclusion
Every business sits somewhere on the continuum from extinction to distinction. The difference lies in whether leaders choose to embrace innovation, create uniqueness, and deliver value that competitors can’t replicate.
Extinction is the risk. Distinction is the opportunity. The choice is yours.
