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Jul 20, 2018

Smart Companies Try To Commoditize Their Products’ Complements

Joel Sposky quoted in the paper // Commmoditize your complement

All else being equal, demand for a product increases when the prices of its complements decrease.

…In general, a company’s strategic interest is going to be to get the price of their complements as low as possible. The lowest theoretically sustainable price would be the commodity price - the price that arises when you have a bunch of competitors offering indistinguishable goods.

So: Smart companies try to commoditize their products’ complements. If you can do this, demand for your product will increase and you will be able to charge more and make more.

Up next Create a Desert of Profitability Around You ucaetano on Hacker News: I once had a strategy professor define the Google business model somewhat like that, where “Google tries to make every

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