Joe Batista and Commoditization

Well, I had the most interesting morning with Joe Batista, the "chief creatologist" of Hewlett Packard. A quick bio :

Joseph (Joe) Batista, Director & Chief Creatologist at Hewlett Packard (HP) Corporation, is responsible for building new business realties leveraging HP’s portfolio of assets, and driving new growth, strategy and implementation agendas that deliver real business results.

As you might know, I'm a former chairman of the Cape Cod Technology Council, which sort of sounds like "President of the Orleans Kiwanis". In a way, it is, but with a twist. Tons of successful Boston area executives and engineers have houses down here on the Cape, Nantucket or Martha's Vineyard, and they all have a vested interest in seeing high tech on the Cape flourish. So, we tend to have excellent speakers come to our breakfasts. As an example, we had the director of NASA's Institute for Advanced Concepts (NIAC), who has a house here, speak to us about all the neat 10 to 40 year projects that NASA is working on, including anti-matter drives and hopper bots. And yes, it does sound like Star Trek. That's because the producers of Star Trek make regular visits to NIAC for TV show fodder. Yes, anti-matter drives are a real project, ableit nascent, at NASA. Cool, huh? But, I digress.

Joe was speaking to us about the new economy, where the real asset is ideas. As part of this, he spoke about commoditization, and used as real world examples Clorox and coffee beans. Now, here's an excellent take away based on coffee beans. It doesn't take a creatologist to relate this to today's world of telephony:

Commodity == coffee beans, 1-2 cents per pound
Product == Maxwell house coffee, $1.25 per pound
Service == Dunkin Donuts Coffee, $1.25 per cup
Experience == Starbucks Coffee, $2-$5 per cup

I'll leave you with a quote from Pulp Fiction :

                                 BUDDY
                     How 'bout you, Peggy Sue?

                                MIA
                     I'll have the Durwood Kirby burger
                     -- bloody -- and a five-dollar
                     shake.

                                BUDDY
                     How d'ya want that shake, Martin
                     and Lewis, or Amos and Andy?

                                MIA
                     Martin and Lewis.

                                VINCENT
                     Did you just order a five-dollar
                     shake?

                                MIA
                     Sure did.

                                VINCENT
                     A shake?  Milk and ice cream?

                                MIA
                     Uh-huh.

                                VINCENT
                     It costs five dollars?

                                BUDDY
                     Yep.

                                VINCENT
                     You don't put bourbon in it or
                     anything?

                                BUDDY
                     Nope.

                                VINCENT
                     Just checking.



Later...
                            VINCENT
                     Can I have a sip of that?  I'd like
                     to know what a five-dollar shake
                     tastes like.

                                MIA
                     Be my guest.

      She slides the shake over to him.

                                MIA
                     You can use my straw, I don't have
                     kooties.

      Vincent smiles.

                                VINCENT
                     Yeah, but maybe I do.

                                MIA
                     Kooties I can handle.

      He takes a sip.

                                VINCENT
                    Goddamn!  That's a pretty fuckin'
                    good milk shake.

                                MIA
                    Told ya.

                                VINCENT
                    I don't know if it's worth five
                    dollars, but it's pretty fuckin'
                    good.

      He slides the shake back.