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I am a porridge man, and I’m fussy. Instant mixes are not for me. I want properly cooked porridge made from mabela (sorghum), oatmeal (rolled oats is best) or maize meal. Coarse yellow maize meal is a delicacy in our household!
I recently had the pleasure of visiting an old friend, a maize farmer, whom I have not seen for some years. On bidding him farewell, for old times’ sake, he gave me a special gift, a 5kg pack of 50% white and 50% coarse yellow maize meal produced on his farm. He knew I was a porridge lover!
His gift got me thinking about product differentiation, and how any farmer could get their product into the hands of the customer in a manner that set them apart from the crowd and extracted most value.
Back in my office, I searched the Internet for other producers of a similar maize product and found none.
But to my great surprise, I did learn that there are about 20 different maize products on the market in South Africa, including ‘super maize meal’, ‘special maize meal’, ‘braaipap’, ‘samp’, ‘maize rice’, ‘maize grits’, ‘maize flour’, ‘super-fine maize meal’ and ‘sifted maize meal’.
So, here we have what is classed as a ‘commodity’, which I have been told is impossible for the farmer to differentiate, when in fact it’s offered in a wide array of products, even before we get to the range of packing, brands and prices, of which there are many.
If this could be achieved with the humble mielie, I wondered about all the other so-called ‘commodity’ products. Could they too be differentiated?
I was inspired to head into town to look through a few supermarkets. I started with the product I’ve farmed for many years, sugar. Here surely is a product that doesn’t readily lend itself to differentiation.
Sure enough, at first sight I found standard white and brown sugar in an assortment of pack sizes, brands and prices.
A little further down the aisle I found castor sugar, dark brown sugar, light brown sugar, muscovado sugar, demerara sugar, chunky brown coffee sugar, multi-coloured sugar, and even organic sugar. Here too there were three brands and a wide range of pack sizes.
I wandered through the fresh produce section and my eye fell on a standard 10kg paper pocket of potatoes. A quick survey turned up 27 different ways in which potatoes were being offered for sale.
There were small, medium and large potatoes in 11 different package sizes, four different ready-to-cook potato packs and six different frozen potato products, not to mention a plethora of potato-chip types.
Quite clearly, the belief that it’s impossible to differentiate commodity products is a myth. It might not always make economic sense, but with some creativity it is always possible.
With fruit, the sky is the limit. See the pictures of two huge success stories in product differentiation when presenting avocados to consumers.
Peter Hughes is a business and management consultant.
