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Marketing myopia is the tendency of businesses to define their market so narrowly as to miss opportunities for growth. It is suggested that businesses will do better in the long-term if they concentrate on improving the utility of a product or good, rather than just trying to sell their products. [1] [2] [3]
Theodore Levitt postulated that a myopic culture would lead a business to fall due to the short-sighted mindset and the illusion that a firm is in a so-called "growth industry." Such beliefs lead to complacency and losing sight of what customers want. It is said that myopic managers focus more on the original product and refuse to adapt to the needs and wants of the consumer.
To continue growing, companies must understand and act on their customers’ needs and desires instead of banking on the presumptive longevity of their products. In many cases growth is threatened, slowed or stopped not because the market is saturated but because of a failure of management.
The paper was influential. Some commentators have suggested that the publication of Levitt's book marked the beginning of the modern marketing movement. [4] Its theme is that the vision of most organizations is too constricted by a narrow understanding of what business they are in. The book exhorted CEOs to re-examine their corporate vision and redefine their markets in terms of wider perspectives. It was successful because it was, as with all of Levitt's work, essentially practical and pragmatic. Organizations found that they had been missing opportunities which were plain to see once they adopted a wider view. For example, several oil companies (which represented one of his main examples in the paper) redefined their business as energy rather than just petroleum. By contrast, when the Royal Dutch Shell embarked upon an investment program in nuclear power, it failed to demonstrate a more circumspect regard for their industry.
One reason that shortsightedness is so common is that people feel they cannot accurately predict the future. While this is a legitimate concern, it can be alleviated by prioritizing customer needs instead of focusing on the product or service. Customer needs are far more static over time. Oil company customers will always need energy, while they may not always need petroleum to fill that need.
There is no such a thing as a growth industry, according to Levitt. There are only companies organized and operated to create and capitalize on growth opportunities. Corporate self-deception revolves around four conditions:
When industries change, companies can take advantage of a greater scope of opportunities. Levitt's work teaches managers to look beyond their current business activities and think "outside the box". George Steiner (1979) is one of many in a long line of admirers who cite Levitt's famous example on transportation. If a buggy whip manufacturer in 1910 defined its business as the "transportation starter business," they might have been able to make the creative leap necessary to move into the automobile business when technological change demanded it. [6] [ clarification needed ]
People who focus on marketing strategy, various predictive techniques, and the customer's lifetime value can rise above myopia to a certain extent. This can entail the use of long-term profit objectives (sometimes at the risk of sacrificing short term objectives).
The “new marketing myopia” occurs when marketers fail to see the broader societal context of business decision making, sometimes with disastrous results for their organization and society. It stems from three related phenomena: (1) a single-minded focus on the customer to the exclusion of other stakeholders, (2) an overly narrow definition of the customer and his or her needs, and (3) a failure to recognize the changed societal context of business that necessitates addressing multiple stakeholders. In the “new marketing myopia.” customers remain a central consideration, as in the traditional “marketing myopia.” However, academics that developed the idea of the “new marketing myopia” state that it is essential to recognize that other stakeholders also require marketing attention. For business-to-consumer companies, these other stakeholders (e.g., employees) are sometimes (but not always) customers too. [7]
There are multiple examples of industries that have experienced little or severe downfall due to marketing myopia. An example of an industry that suffered from marketing myopia is the video rental industry, which was dominated by Blockbuster LLC, an American company, in the early 2000s. Blockbuster failed to adapt to the emergence and popularity of online streaming services, such as Netflix and filed for bankruptcy in 2009. [8]
Kotler and Singh (1981) coined the term marketing hyperopia, by which they mean a better vision of distant issues than of near ones. [9] Baughman (1974) uses the term marketing macropia meaning an overly broad view of your industry. [10]
Marketing is the act of satisfying and retaining customers. It is one of the primary components of business management and commerce.
Strategic planning is an organization's process of defining its strategy or direction, and making decisions on allocating its resources to attain strategic goals.
In the field of management, strategic management involves the formulation and implementation of the major goals and initiatives taken by an organization's managers on behalf of stakeholders, based on consideration of resources and an assessment of the internal and external environments in which the organization operates. Strategic management provides overall direction to an enterprise and involves specifying the organization's objectives, developing policies and plans to achieve those objectives, and then allocating resources to implement the plans. Academics and practicing managers have developed numerous models and frameworks to assist in strategic decision-making in the context of complex environments and competitive dynamics. Strategic management is not static in nature; the models can include a feedback loop to monitor execution and to inform the next round of planning.
Distribution is the process of making a product or service available for the consumer or business user who needs it, and a distributor is a business involved in the distribution stage of the value chain. Distribution can be done directly by the producer or service provider or by using indirect channels with distributors or intermediaries. Distribution is one of the four elements of the marketing mix: the other three elements being product, pricing, and promotion.
A marketing plan is a strategy or outline created to accomplish a marketing team's objectives. A marketing plan is often created together by marketing managers, product marketing managers, product managers, and sales teams. A marketing plan falls under the umbrella of the overall business plan.
Product life-cycle management (PLM) is the succession of strategies by business management as a product goes through its life-cycle. The conditions in which a product is sold changes over time and must be managed as it moves through its succession of stages.
Marketing management is the strategic organizational discipline which focuses on the practical application of marketing orientation, techniques and methods inside enterprises and organizations and on the management of a firm's marketing resources and activities.
Porter's Five Forces Framework is a method of analysing the operating environment of a competition of a business. It draws from industrial organization (IO) economics to derive five forces that determine the competitive intensity and, therefore, the attractiveness of an industry in terms of its profitability. An "unattractive" industry is one in which the effect of these five forces reduces overall profitability. The most unattractive industry would be one approaching "pure competition", in which available profits for all firms are driven to normal profit levels. The five-forces perspective is associated with its originator, Michael E. Porter of Harvard University. This framework was first published in Harvard Business Review in 1979.
Marketing strategy is an organization's promotional efforts to allocate its resources across a wide range of platforms and channels to increase its sales and achieve sustainable competitive advantage within its corresponding market.
Relationship marketing is a form of marketing developed from direct response marketing campaigns that emphasizes customer retention and satisfaction rather than sales transactions. It differentiates from other forms of marketing in that it recognises the long-term value of customer relationships and extends communication beyond intrusive advertising and sales promotional messages. With the growth of the Internet and mobile platforms, relationship marketing has continued to evolve as technology opens more collaborative and social communication channels such as tools for managing relationships with customers that go beyond demographics and customer service data collection. Relationship marketing extends to include inbound marketing, a combination of search optimization and strategic content, public relations, social media and application development.
The target audience is the intended audience or readership of a publication, advertisement, or other message catered specifically to the previously intended audience. In marketing and advertising, the target audience is a particular group of consumer within the predetermined target market, identified as the targets or recipients for a particular advertisement or message.
Theodore Levitt was a German-born American economist and a professor at the Harvard Business School. He was editor of the Harvard Business Review, noted for increasing the Review's circulation and popularizing the term globalization. In 1983, he proposed a definition for corporate purpose: "Rather than merely making money, it is to create and keep a customer".
Global marketing is defined as “marketing on a worldwide scale reconciling or taking global operational differences, similarities and opportunities in order to reach global objectives".
The following outline is provided as an overview of and topical guide to marketing:
Societal responsibility of marketing is a marketing concept that holds that a company should make marketing decisions not only by considering consumers' wants, the company's requirements, but also society's long-term interests.
Customer experience is the totality of cognitive, affective, sensory, and behavioral customer responses during all stages of the consumption process including pre-purchase, consumption, and post-purchase stages.
Multicultural marketing is the practice of marketing to one or more audiences of specific ethnicities—typically an ethnicity outside of a country's majority culture, which is sometimes called the "general market." Typically, multicultural marketing takes advantage of the ethnic group's different cultural referents—such as language, traditions, celebrations, religion and any other concepts—to communicate to and persuade that audience. Cultural as well as ethnic variations in multicultural societies such as the United States provide marketers with the opportunity to connect with consumers by developing consumer segments for targeted marketing initiatives. For example, insight into the culture and ethnicity of consumers is applied directly to consumer targeting through a variety of marketing initiatives in the U.S.
Sustainability marketing myopia is a term used in sustainability marketing referring to a distortion stemming from the overlooking of socio-environmental attributes of a sustainable product or service at the expenses of customer benefits and values. Sustainability marketing is oriented towards the whole community, its social goals and the protection of the environment. The idea of sustainability marketing myopia is rooted into conventional marketing myopia theory, as well as green marketing myopia.
Product strategy defines the high-level plan for developing and marketing a product, how the product supports the business strategy and goals, and is brought to life through product roadmaps. A product strategy describes a vision of the future with this product, the ideal customer profile and market to serve, go-to-market and positioning (marketing), thematic areas of investment, and measures of success. A product strategy sets the direction for new product development. Companies utilize the product strategy in strategic planning and marketing to set the direction of the company's activities. The product strategy is composed of a variety of sequential processes in order for the vision to be effectively achieved. The strategy must be clear in terms of the target customer and market of the product in order to plan the roadmap needed to achieve strategic goals and give customers better value.
Defensive strategy is defined as a marketing tool that helps companies to retain valuable customers that can be taken away by competitors. Competitors can be defined as other firms that are located in the same market category or sell similar products to the same segment of people. When this rivalry exist, each company must protect its brand, growth expectations, and profitability to maintain a competitive advantage and adequate reputation among other brands. To reduce the risk of financial loss, firms strive to take their competition away from the industry.
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