MARKETING MYOPIA

1. MARKETING MYOPIA
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Course: MBA-I
Subject: MARKETING MANAGEMENT - 1
Unit: 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 will 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 competition.

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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 ultimate 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 first 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 ability 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 competition, 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 Myopia
1. classic myopia, with a product-
definition/single-industry perspective,
2. competitive myopia, with a
customer-definition/single-industry
perspective,
3. efficiency 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.

30. 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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