MARKETING MYOPIA

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Course: MBA-ISubject: MARKETING MANAGEMENT - 1Unit: I

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The Marketing Myopia In 1960, Theodore Levitt wrote

"Marketing Myopia," a widely quoted and frequently reprinted Harvard Business Review article.

Chapter eight in Theodore Levitt's book - The Marketing Imagination (New York: The Free Press, 1986).

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The Marketing Myopia What does the term marketing myopia

means? What were the evidence and examples

used to illustrate the notion of marketing myopia?

How is the self-deceiving cycle related to marketing myopia?

Is this notion of marketing myopia still valid today, and explain?

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The Marketing Myopia Marketing myopia was initially

described as a firm's shortsightedness or narrowness when attempting to define its business.

The key question – “what business are you in?”

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The Marketing Myopia Levitt cites the railroads and

Hollywood as examples of "industries that have been and are now endangering their futures by improperly defining their purposes." Their problem, he says, is they were "product-oriented instead of customer-oriented.“

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The Marketing Myopia Warning of the dangers of being

product-oriented rather than customer-oriented - creating the Ford Edsel, New Coke or smokeless cigarettes, as it were, rather than products consumers wanted.

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The Marketing Myopia According to Levitt, "the

organization must learn to think of itself not as producing goods or services but as buying customers, as doing the things that wil l make people want to do business with it ."

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The Marketing Myopia Since its publication, corporate leaders

have moved from product-orientation toward market-orientation.

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The Marketing Myopia

Customer orientation has also been

considered as a type of marketing myopia.

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The Marketing Myopia Firms overemphasize the satisfaction of

customer wants and needs and as a result ignore competit ion.

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The Marketing Myopia Competitor orientation has been

proposed as a replacement for the customer orientation; with this orientation, a firm's strategy is influenced by its competitors (Oxenfeldt and Moore, 1978).

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The Marketing Myopia

The marketing myopia described by Levitt

has also evolved into a planning myopia…

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The Marketing Myopia Businesses need to take

Levitt 's idea to its ult imate end – do not just sell a product, sell the

solution to a problem.

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The Marketing Myopia Oil companies have followed that strategy by

developing minimarts in service stations. Digital Equipment Corp. earned one-third of its $7

billion in revenue from computer maintenance services.

General Motors Acceptance Corp. financial services accounted for $1 billion of the automaker's $4 billion in 1985 revenues, and

Gerber Products is opening day care centers as well as acquiring baby-related product companies.

By recognizing customer needs, these companies have used available corporate resources to enter nonmanufacturing segments of the market.

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The Marketing Myopia

The marketing myopia to the world market

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The Marketing Myopia Yves Doz, Jose Santos and Peter J.

Williamson draw on some examples of companies that are major successes because they sought knowledge in other countries, such as

Shiseido, the Japanese cosmetic company that looked to France to become once again a leading player.

Little Scandinavian Nokia overtook Motorola in the early days of the mobile wars simply by monitoring the radar for emerging phenomena in markets around the world.

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The Marketing Myopia Innovating using local knowledge,

perfecting your product and service to meet the needs of customers in your home market, and benchmarking yourself against domestic competitors-each of these has become a high risk strategy.

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The Marketing Myopia After all, cellular telephony had been invented in

America-at Bell Laboratories, and Motorola was among the first to massproduce mobile telephones.

So then, how did Nokia, a little-known upstart from the edge of the Arctic Circle leave Motorola behind and manage to become the global leader in mobile telephony?

Nokia was the f irst to see the potential of a cellphone as a fashion accessory from observations of its customers in Asia .

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The Marketing Myopia Nokia has the abil i ty to plug into knowledge about

new technologies and emerging customer needs from every corner of the world .

It understood the need for customised handsets from its experience in Europe, where it first became apparent that there were different segments of users.

Observing pilot users across Scandinavia, it was among the first to recognise that digital technology could dramatically improve the functionality of mobile phones.

And in China, India and Africa, it saw that mobile phones could potentially become substitute for wire-line phones.

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The Marketing Myopia While Nokia prospected the world for

insight about promising technologies, diverse customer behavior and new ways to use mobile phones, Motorola continued to develop its products based on its knowledge of the customers and technologies in its U.S. backyard.

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The Marketing Myopia The result : Motorola missed the shift to digital

mobile telephony and the growing strength of the European GSM standard. It didn't see the potential to turn the phone into a fashion icon; it was slow to take on board the new ways mobiles were being used and to recognise that a broader, but more fragmented user base would spell the end of "one-size-fits-all" products.

This myopic approach to competit ion, and the failure to engage fully with the rest of the world and capture the potential of global markets and the innovative ideas in them, would cost Motorola dearly.

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The Marketing Myopia

The types of marketing myopia can be classified along two dimensions:

1. the management's definition of the firm, and 2. the firm's business environment perspective.

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The Marketing Myopia The second dimension concerns the firm's

business environment perspective. In essence, these firms have an inward orientation toward that industry.

Firms with a single-industry perspective are preoccupied with the actions and reactions of immediate competitors.

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The Marketing Myopia In addition, they are considered to have inbred

management. Some managers have spent the greater part of their professional careers in one industry.

Inbred management is not necessarily undesirable, but it is potentially detrimental when it fosters the contention that it can learn nothing from firms in other industries, and it keeps its firm perceptually insulated from such other firms.

For example, managers of the cold breakfast cereal firm may be concerned only with the actions and reactions of other cold cereal firms.

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The Marketing Myopia Firms with a multi-industry perspective,

on the other hand, have a broader view of the market.

While they are concerned with immediate competitors, they also realize that firms in other industries can serve as sources of innovative strategies as well as being potential competitors.

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The Marketing Myopia Such management is said to be cross-bred, in

that managers may have experience in a broad range of industries or they are willing to learn from firms facing similar situations in other industries.

Firms with a multi-industry perspective are outwardly oriented and not perceptually insulted from other industries.

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The Marketing Myopia The combination of the two

dimensions produces a matrix with four types of firms:

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The Marketing Myopia1. classic myopia, with a product-

definition/single-industry perspective, 2. competit ive myopia, with a

customer-definition/single-industry perspective,

3. eff iciency myopia, with a product-definition/multi-industry perspective,

4. innovative myopia, with a customer-definition/multi-industry perspective.

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The Marketing Myopia Marketing managers who wish to

achieve the innovative firm orientation should:

1. take a generic view of their firm or industry, 2. monitor other industries, 3. engage in benchmarking to determine the

objectives for relevant areas of marketing, 4. recruit marketing people, and 5. be flexible enough to apply unique solutions to

problems.

REFERENCES & SOURCES en.wikipedia.org/wiki/Marketing_myopia www.businessdictionary.com/definition/mar

keting-myopia.html www.wisegeek.org/what-is-marketing-

myopia.htm

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