Strategic Marketing

Assignment No 1

Summary of the Article

Marketing Myopia

Submit to: Dr. Ali Raza

Marketing Myopia, described in detail in Harvard Business Review by Theodore Levitt, is a short-
sighted and inward-looking attitude to marketing that emphasizes on serving the company's basic
needs instead of concentrating on marketing from a customer viewpoint. The main purpose of
author in this article is that company should do more than simply sell their goods. His key point
was that the marketer would always concentrate on the needs & happiness of consumers and not
on selling and filling buyers with their goods. In short, marketing myopia is a theory that states
business has a limited-minded marketing strategy and it relies primarily on just one feature out of
several different marketing characteristics.
In this article, the author shares his thoughts about how companies have struggled to carry on
through due to a lack of understanding of the need to broaden into sectors adjacent to which they
currently operate. Levitt argues that while they would be consumer focused, the big errors of the
companies were being made or service driven.

Fateful purposes
According to this article businesses went into recession because they could not properly describe
their sector industries. Levitt focused on examples of several productive and failed businesses
which were product-oriented and not customer-oriented and these industries are like Railroad
Industry (moving products vs. transport industry), Hollywood (movies vs. entertainment) and
Petroleum (oil vs. electricity business).
Error of analysis
In the article the author goes on to discuss the error of analysis through defining the scope of
businesses inaccurately and unable to expand due to its limitation. He followed this with an
explanation of the failing railroads as they were oriented to the train rather than to the transport;
they were oriented to the commodity rather than the consumer. They refuse not from vehicles,
buses, aircraft, and telephones, but from their own myopia. The Hollywood industry had
deteriorated in a related case, as they concentrated on films and not the movie business. Thus, a
company is best prepared for success if it focuses on fulfilling the wants and desires of the
consumer rather than industrial manufacturing and distribution strategies of its product.
Shadow of obsolesce
In the shadow of obsolesce, Levitt focused on why firms avoid through as their goods risk their
existence due to over dated or quickly replicated rivalry out time. He provides the illustration of
the dry-cleaning industry seeing any obsolescence threat due to modern technologies and solutions
that satisfy the needs of consumers. It used to be a vibrant business that offered an easy way to
clean wool clothing, but over time the emergence of simpler to clean synthetic fabrics may not
involve dry cleaning facilities and inventions like washing machines rendered the industry
redundant.
Other reasons he goes over are the power utilities: electric motors substitute combustion turbines
and incandescent lamps substitute kerosene lighting and furthermore, massive retail outlets
replacing the grocery stores.
Self-deceiving cycle
Firms suffering from myopia are often exposed to a self-deceiving loop as they feel there is nothing
wrong in their method, even if it does occur. The repetitive existence, since most businesses make
the mistake of concentrating on development and revenue and not giving adequate attention to
consumer needs. The self-deceiving process has four conditions;
• The assumption that the growing and wealthier population guarantees production.
• Pretending to believe that there is no viable alternative for the main commodity of the
market.
• Too much confidence in industrial manufacturing and the profit of quickly declining unit
costs as demand rises.
• Care for a substance that contributes itself to carefully controlled scientific
experimentation, innovation and cost savings in production.
Population myth
Levitt addresses the demographic hypothesis fallacy, whereby businesses believe a growing
population is equivalent to a growing demand on the sector. Companies say they are guaranteed
income dependent on population growth. This mythos restricts the idea and image of company.
“the absence of a problem leads to the absence of thinking.”
Asking for trouble
The author used petroleum industry as an example and indicating that, they concentrated more on
enhancing the quality of importing and manufacturing and not developing the branded commodity
or its promotion. Levitt claims that the commodity is described in the narrowest terms in that field,
namely gasoline and not electricity or transportation. This has encouraged developments to emerge
beyond the oil business, such as new companies developing multi-pump gas stations with an
emphasis on broad formats, quick and reliable driveway operation, and fuel quality at reasonable
rates.
Idea of indispensability
The principle of indispensability is that businesses believe their commodity is irreplaceable since
they are free from competition. Because of its popularity in its existence, Levitt chose the
petroleum business as an illustration, because it had to change emphasis many times owing to
innovations emerging from outside the sector. Through its policy, the petroleum industry has been
satisfied and expects that as the population of the planet continues to expand that its consumer
base can still increasing. It adds to the sector becoming myopic towards the reality that now
consumers are increasingly socially aware and engaging in many renewable sources of energy
minimizing greenhouse gas emissions.
Uncertain future
The author argues in the article that an organization can not merely depend on a complacent
approach and method, it must grow into new markets and deliver customer-oriented goods or
services or its rivals would.
Production pressure
Large processing companies concentrate on generating all they can and are involved in achieving
the development targets without neglecting promotion of such goods. John Kenneth Galbraith
claims the contrary, the plan to 'push' the company is now under way. Levitt illustrates how
companies have so much confidence in industrial manufacturing to taking advantage of fast-
decreasing unit costs as demand increases.
Lag in Detroit
Levitt cites Detroit as an indicator of how the car sector has embraced the pattern towards industrial
manufacturing. Researchers at Detroit have struggled to understand what their clients desire.
Detroit claimed that consumers would not like something more than what they already had before
it lost millions of their buyers to other small car manufacturers. Detroit studied only the needs of
the consumer for the goods which it had already agreed to sell. Detroit has not concentrated on
selecting the client.
What Ford put first
Levitt criticizes Ford's idea of innovation in engineering. Ford has developed the production line
to produce thousands of vehicles and transport them. He correctly projected he will market millions
of cars to buyers for a moderate amount. It's how he sold out and not what buyers ordered. Levitt
considers the meeting an experiment in publicity.
Creative destruction
As for the fuel industry through consumer heads, consumers at the gas pump will not purchase
gasoline for their taste, color or scent, they purchase the freedom to operate their vehicles.
Answering the wishes of the customer will mean granting them the freedom to indefinitely operate
their vehicles, and the prospect of gasoline is a product that avoids regular refueling. Any
company's vision is not a more advanced one but a company that fulfills the desires of a customer.
Companies will respond by responding to consumer needs, knowing their buyers' interests, why
they bought, what they purchased, and whether they would buy again. Successful businesses are
not ashamed to dump one company to produce the next, or ruin everything they've created to satisfy
the consumer better. Because of the historical fate of every development industry it is the required
"creative destruction" process; "provincialism of the commodity."
Dangers of R&D
Electronic companies are in danger of paying too much attention to research and development.
They evolve with the idea that they are offering themselves a better product as they have produced
a good product.
Possible explanations for this belief: a prejudice in the promotion against the sophisticated
products; scientists seem not to concern about consumer needs. Even when companies focus on
marketing, they are more concerned with ads and product promotions than with finding out the
customers' needs.
Stepchild treatment
In certain sectors, such as the petroleum sector, this occurs when both practices are more associated
with sourcing / searching and processes, and less associated with selling. Customer and industry
enquiries are not addressed. The interests of the consumers are not taken into consideration-"
Marketing is a stepchild.
Beginning and end
Consumer satisfying mechanism is crucial in a company, however by identifying the issue,
proposing a theory to address the question, and not recognizing customer satisfaction as the issue,
experimental approaches violate this law. Industries ought to be mindful of the very diverse
advertising and marketing methods. An industry's principal roles would be;
1) Marketing (satisfying the customer’s needs)
2) Delivering
3) Selling
4) Production
5) Research and development
Visceral Feel of Greatness
Leaders require a dream that will put out devoted followers, the followers are the consumers.
Management does not manufacture goods but deliver service fulfillment to customers; understand
the desires of the buying consumer. The leader always has to have a goal to realize where they are
headed. "A passionate leader powered on by a pulsating desire to be effective." This article
suggests an organization to be;
➢ consumer focused
➢ constantly innovative
➢ in a position of control
➢ Capable of responding to new marketing strategies, based on consumer input.
To be able to cater to a company's market demands, it has to be not only technically sound but also
customer-oriented. To keep the attention of the consumer for as long as possible, it should conduct
research on a regular basis and figure out different ways to improve the goods. To survive the
increasing competition, the company should indeed keep adjusting to the ever-changing market
conditions and demands.
Examples of Marketing Myopia
Marketing myopia has real implications in business. If the businesses not aware of it then a slow
decline can set in right under their nose. Knowing it exists is not enough though. It’s important to
act to prevent it from affecting the bottom line. Therefore, the following examples
Kodak

There was a period when Kodak's cameras were at the top of the industry, they proceeded
through the years to manufacture the same styles of cameras. Sony's cameras were a huge
success when it introduced its digital cameras into the market. Kodak's cameras had been kicked
out of the market.

Nokia

Back in early 2000-2006; Nokia's pad-button phones were at the peak of the industry and Nokia
held all market share. Despite the growing technologies Nokia has not updated its offering.
Nokia's products were not to be seen on the market in 2016, nearly 10 years later. Samsung and
the iPhones won the whole market share that was once Nokia's.

Entertainment

Nowadays computer games, TV shows, film, showbiz, etc, all fall under the entertainment
umbrella. It's because they are all addressing the same market, rather than differentiating
themselves from each other, they have agreed to settle to one aspect and it is to impress their fans
and function together.

Yahoo

Yahoo (worth $100 billion dollars in 2000) lost to Google and was bought by Verizon at
approximately $5 billion (2016).