The Rise of Commoditization

How do we overcome the trend of commoditization and build a base of new customers in the process? Learn specific tips from our upcoming, free eBook ‘How to Differentiate Yourself from this Commoditization.'

There’s good news on the horizon for the U.S. professional pest control industry. In a recent report, it’s estimated that the market for services should reach $10 Billion in revenue by 2020. It’s predicted that the industry will grow at a compound annual growth rate (CAGR) of 4.6% over the next 5 years.

This growth is driven by increased economic activity, demand due to rising awareness, middle-class populations, more stringent regulations in sanitation and hygiene, along with a rise in government spending on health related issues.

This is all great economic news, but as the future for pest control looks bright, another trend in the industry could have a negative effect on small to medium size operators. The commoditization of the pest control industry is one of the looming realities that you need to understand today in order to mitigate the risks associated with your business tomorrow.

Examples of this trend are in industries all around you: airlines, hospitality, telecommunications and so on. Consolidation and commoditization are common issues for growing a small to medium size business, and in competing with the larger companies that are all around you.

In this age of online search, consumers can easily shop companies offering the same or similar services looking for the best deal. Companies end up undercutting competitors on price alone, cannibalizing the market in a race to the bottom - where small to medium size businesses get squeezed out by larger companies with the ability to maintain profit margins on volume.

While many things have changed in the pest control industry, a few things haven’t. Although the industry is predicted to grow, market penetration has remained almost constant at around 22% according to some industry reports. This means there’s a large percentage of potential new users of pest control services that could be acquired and additional significant revenues generated for your business.

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