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Problem

Many companies, including GE, Quaker Oats, and United Technologies, report millions of dollars of savings from using reverse auctions rather than traditional purchasing methods. Of course, business marketing strategists fear that these auctions will transform their products and services into commodities. Propose particular strategies that marketing managers might follow to deal with this challenging situation.

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Step 1/3

In today’s scenario most of the USA based companies use reverse auction of raw material rather than using traditional method of purchasing. In this process companies save million of dollar every year.

Business marketing strategists have often expressed their fear and concerns that these auction practices can transform their product and services into commodities.

Step 2/3

Following strategies should be used by marketing managers in order to deal with such situation:

• Change the raw material in the form of a differentiation product (with different special characteristics) so that the fear of being treated as a commodity is foregone.

• Companies should develop special professional ways of alternative of auctions. In that way strategists can remove the fear of products being treated as commodities.

Step 3/3

Thus, following are the given ways in which a company can work so that the products and services are not treated as commodities.