Applications in brand strategy
Welcome to the Sociology of Business. If you are not subscribed, join the community by subscribing below and joining the Sociology of Business Discord. You find my book, The Business of Aspiration on Amazon and you can find me on Instagram and Twitter. For those new here, in my last analysis, Taxonomy of Value, I explored different ways of making things valuable and how brands can capitalize on all of them.
Com·mer·cial·i·za·tion /kəmərSHələˈzāSH(ə)n/ is “the process of managing or running something principally for financial gain.” Related is com·mod·i·fi·ca·tion /kəˌmädəfəˈkāSH(ə)n/, “the transformation of things into objects of trade.”
Commercialization started with industrialization, when products were mass produced instead of being handmade in small batches by the craftsmen. Commercialization turned all sorts of previous luxuries into mass-produced objects (e.g. automobiles, IKEA’s modern, affordable furniture; airplane travel; tourism; fast fashion). The trend spread to art, which largely switched from being social commentator and a critic to an economic investment. It also spread to the accessibility of luxury fashion, to “content” (anything that is posted on social media to be consumed), to movies (we are now on the 55th Avenger sequel), to ourselves (social commerce, creators). Majority of the contemporary cultural, social, economic and even environmental output is a commodity (one can buy carbon-neutral points when flying. Or a Tesla).
De-commercialization is a reverse process. It’s a mechanism of making objects non-tradable. Recently, we have seen a shift in appreciation (of desirability and value) of artisanal items like cookware and homeware, antique furniture and vintage fashion, and hand-crafted objects like kitchen knives. Related is the rise in secondary marketplaces, where the story around an item, item rarity and the high of the hunt is deemed more valuable in value than its price. Creator economy also brought forward the value (and monetization) of individual output. Web3 and non-fungible tokens expanded non-tradable nature of goods, as anything associated with an NFT is one-of-a-kind by default. The consequence is that the value is set based on the social consensus rather than the market place. Alternative models of economic exchange surround non-tradable objects, such is tipping of creators or directly funding creators for their output.
There are several ways of to decommercialize products:
Auctions. By their very format, auctions sell unique items. Even if an item has originally been made as part of a collection or a series (which both influence its price), the value of an item is intangible, defined by social and cultural criteria (desirability, significance) and the auction context.
Resale marketplaces. Who is selling is often more important than what they are selling. What’s on sale in this scenario is a personal style or one’s look; items are a mere way of delivering it.
Myth. Before 1999, the “Centurion Amex” was just an urban legend. An invitation-only card with no credit limit didn’t exist. But when American Express launched its Black Card, myth become reality and the company’s best brand ambassador.
Provenance. Consumers are buying a product due to its provenance. “Made in California” holds greater weight than “Designed in California.” The provenance appeal is furthered by the real or perceived heritage of craftsmanship that a location has: e.g. New York City’s Garment District still has a know-how that a lot of out-sourced factories do not.
Story. Häagen-Dazs was launched in the 1960s by two Polish-Jewish immigrants living in the Bronx. The words don’t mean anything, in any language, but the European-sounding name gave cultural biography to a brand trying to stand out in the saturated ice-cream market. It also turned a mundane product into an aspirational one, linking consumers interested in old-world artisanship and sophistication.
“Artification.” One of the main pillars of brand-building in aspirational markets is to turn brand founders into artists and/or messianic visionaries destined for greatness and glory. In many cases, this link is invented and a brand creator - who may have been a luggage maker like many others - becomes a superb craftsman thanks to the marketing machinery.
Collaborations. Done right, collaborations generate collectibles, justify high prices, create cult objects, and initiate brands in the domain of intangibles. They transform non-culture into culture. When someone buys a Nike x Off-White, they aren’t actually buying a bag or a t-shirt; they’re buying a legit work of art. When they wear it, a person shows off their knowledge and cultural awareness. They also see themselves through a new lens: not as mere consumers, but as collectors.
Collections. Through cultural associations, collections accumulate social and economic capital that is used by collectors to convey their status and taste. Once an item is part of a collection, it accrues capital in context of its secondary market value. A pair of Air Jordans that belong to Nigo’s collection are more valuable than the same pair sold by an anonymous seller on Grailed. Nigo’s sneaker collection reflects his taste, creative identity and curatorial sensibility and this gives all the items in this collection an aura and halo of Nigo’s cultural influence.
Semantic invariants. Double “C” logo, quotation marks, or Tiffany blue are stylistic innovations that are invariants of the brand universe.
History. A real or invented history contextualizes products and gives them a precedent: a product becomes the latest iteration of a long tradition rather than a mass-produced object. Popularity of archival revivals and vintage is linked to giving the current brand products historical significance and heritage of creativity.
Barter. TikTok has recently introduced ways for users to provide gifts and tips to favored creators, bartering non-monetary rewards for creators’ fresh material.
C2M. Customer-to-manufacturer format takes advantage of big data and AI to identify shopping trends and deliver on customer interest/need as it is emerging. The outcome are hyper-targeted specialized products (and less excess inventory and improved margins).
De-commercialization is relevant as a competitive advantage, builder of brand equity and price protector. In today’s economy, everything is a commodity - art, content, a personal creative expression, spirituality, neighborhoods, regions, heritage or history. True differentiation is in offering the opposite, and - more importantly - building a business model around it. This new business modeling is based on value versus volume dynamic (less, but better), higher margins, niche-ification and willingness to sacrifice mass growth and the mass market appeal. It also seems like the increasingly only viable model in the mature markets where mass brands are increasingly unable to meet fragmented demand.
Sam Valenti of Ghostly put it best: “In music two of the greatest stories (one big and one small) are bands who got ‘less’ popular but achieved immortality, Radiohead and Talk Talk.
In the late 80s talk talk abandoned synth pop and made two of the most astonishing records ever, much to their label's chagrin. It gave them immortality for music fans whereas their synth pop cohort became novelty acts.
Radiohead became progressively ‘weirder’ after their massive debut and became immortal by losing mainstream fans.
Maybe similar for the Grateful Dead and Phish type bands too, they leave money on the table (like supreme has done) and let the fans make money on them (proto-web3).”
I recently spoke with Martin Raymond, the founder of The Future Laboratory for their new podcast, Back to the F**kture. More about the podcast here: “Our Back to the F**kture series asks renowned thinkers to put foresight predictions under the hindsight spotlight.” We covered the role that culture, as well as commerce, plays in defining a brand’s ethos and how and why certain kinds of GMO (genetically modified) brands have become overgrown, monstrous and tasteless. You can listen to our conversation here.