He claims that there is no such thing as a growth industry. Drucker, P. Levitt claims that every major industry was once a growth industry of its own making by creating and capitalizing on growth opportunities. And a failure of management is what leads a company to decline. He says that there is no such thing as market saturation.
However, I consider this to be an erroneous belief. Furthermore, I would challenge his description of the situation facing railroads. As competitors offering different means of long-distance transportation e. The passenger- automobile industry of the western world has been a declining industry for the last thirty or forty years.
A Summary of Marketing Myopia Essay
It was a growth industry until or perhaps By that time US, Europe and Japan had become fully motorized. Total sales of passenger cars the world over are still growing worldwide propelled by China , though only slowly. This is because they have reached near market saturation in most countries. Yet, the promise of growing demand for passenger transportation in emerging and Third World countries that had lacked the infrastructure thus far could produce a transportation boom like the one that fueled the economic expansion of the midth century. The steel industry 1 billion ton industry worldwide has been facing over-capacity for the last decade and continues to be so even today inspite of runaway demand from China.
If this is not a fully saturated industry, what is? This leads me to my next criticism of the article.
To search for opportunities of ones own making is what Levitt recommends. He upholds John D.
And yet this is exactly what he has warned against, for is not growth as assured by an expanding population and target market exactly what Rockefeller tapped into? Most multinationals that are making a beeline to China, whether in the auto, petroleum, aluminum, hardware, telecom or insurance are whipped by the excitement of the growing middle class affluence in China.
Demographics as defined in our marketing text is the study of the characteristics of a human population. These characteristics include population size, population growth rate, gender, marital status, education, age, and so forth.
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The demand for retail services to provide an affluent, aging population in the developed countries with financial products to provide retirement income has increased tremendously. The institutions that cater to these needs- mutual funds, pension- fund managers and a few, mostly new, brokerage houses-have prospered hugely, first in the United States, then in the UK, and increasingly in Continental Europe and in the Japanese markets.
As is apparent from the above example, demographic changes play a major role in determining the types of goods and services demanded by a population. If the makers of the Blueberry, the Canadian company Research in Motion RIM , defined themselves as belonging to the communication industry they would not have taken the holistic approach to the product as they did. When RIM developed the Blackberry they did not define their industry as wireless hand-held devices, nor did they define themselves broadly, as Levitt suggests, as belonging to the communications industry.
The Blackberry has replaced the Wall Street Journal for financial news headlines and stock quotes.
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It has substituted boredom with mindless single- player games or automatically downloaded Letterman-like top-ten lists, personal computers with the facility to check email, and of-course it has replaced other telephones. The makers of the Blackberry identified different needs of the consumer and strived to meet them irrespective of which industry they were crossing into.
The makers were not bound or limited to one industry.
A critical response to the Marketing Myopia article - Assignment Example
Every year, a large majority of product launches fail. Regardless of which number is right, there is no doubt that a lot of time and energy go into marketing products that will no longer exist in a year. Why is this? I talked with John Deighton, a professor at Harvard Business School and an authority on consumer behavior and marketing, to better understand this classic concept, its origins, and its relevance to organizations today.
The term was coined by the late Harvard Business School marketing professor, Theodore Levitt, in a article by the same name republished in They want a quarter-inch hole! The myopia that Levitt describes is a lack of insight into what a business is doing for its customers. Instead, there are really only companies continuously capitalizing on growth opportunities. There are several examples in the article that illustrate the main concept, that your product is not your business. Perhaps the most famous is the railroad lines, which Levitt argues fell into steep decline because they thought they were in the train business rather than the transportation business.
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Unfortunately, they let other companies seize those opportunities and steal away their passengers instead. Luckily, there is a cure for marketing myopia. Levitt suggests that leaders ask themselves: What business are we really in? Deighton says that the best way for leaders to answer that question is by asking themselves another: What are we really doing for the customer?
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