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Marketing Myopia and Other Ted Levitt Classics: Paying Homage To A Prodigious Thinker

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Recently, I was in Hyderabad, India, teaching a course on Customer-Focused Marketing Strategy at the Indian School of Business.  As a pre-reading for the course, I recommended Ted Levitt’s classic article Marketing Myopia – classics do have their place, even in an age of bulimic sound bytes! 

Even though I have read Marketing Myopia several times, I favored discretion over valor and decided to read it one more time, just in case somebody was hell bent on peppering me with tough questions. 

Reading the article again was more than just a born again experience.  It was a lesson in humility.  Here was an article, first written in 1960, that had nailed several things we are still wrestling with today.  Little wonder that the late Ted Levitt is regarded as one of the most widely respected thinkers in the field of marketing and management. His work and writings have changed the way companies think about their businesses, organize for innovation and creativity, and market their products and services. 

A homage to some of Ted Levitt’s best thinking follows:


Marketing Myopia


The article that gave rise to the famous aphorism – “Customers don’t buy 1/4″ drills, they buy 1/4″ holes.”  It still provokes serious thinking.  The big idea – get companies to think of their businesses in terms of customers needs, not in terms of the physical products and services they produce.  Levitt asserted that all companies and industries were once growth industries.  If they have stopped growing it is not because markets are saturated, but because management failed to correctly grasp what business the company was in.  Invariably, companies that run into growth problems suffer from one overarching weakness; they are overly focused on physical products and services – credit cards, cell phones, mortgages, HDTV – and less on customers and their needs.

After the Sale is Over  – – –

Long before there was CRM and Relationship Marketing, Ted Levitt was discussing the importance of cultivating relationships with customers.  The big idea – a sale signals the end of courtship and the beginning of a marriage with the customer.  The quality of the marriage determines whether there will be continued or expanded business, or troubles and divorce.  Levitt considered relationships with customers as an asset.  The more complex the product and service, the more salient the customers’ needs, the more critical and valuable is this asset.  He advised companies to manage and continually invest in this asset, since over time relationships would trump all other aspects of the marketing system, including technology. 

Marketing Success Through Differentiation – of Anything

The big idea – every company should resist the push towards becoming a commodity, by attempting to differentiate not only their products and services, but by differentiating their whole business, in terms of what they offer and how they operate.  What we call reinventing business models today.    To elaborate, the basics of checking and savings accounts at Citi, Bank of America, Chase, and HSBC may be identical, but how these banks do business and the resultant customer experience may be wholly different/differentiated, and hence a non-commodity.

Moral of the story – knowing the catch phrases from the most recent NY Times best seller list may get you attention at cocktail parties.  But knowing the essence of classical marketing and business writings will get you the promotion you desire and significantly add to your bank balance!  Not a bad thing in any age, especially in today’s recessionary times.