You are on page 1of 7

AN INTEGRATED VIEW OF

MARKETING MYOPIA
Michael D.Richard
JamesA. Womack
Arthur W.Allaway

Since its introduction, much has been writ- The proposed analysis is also intended to
ten on t h e various aspects of Marketing enrich rather than replace the existing expla-
Myopia. It appears that Marketing Myopia per- nations. Thus, the integrated analysis will
tains to seveml types of narrow-mindedness. serve to clarify and reinforce the caveat pro-
The purpose of this article is to organize the posed 30 years ago. The indicants of Marketing
fypes of Marketing Myopia in a classification Myopia include a lack of vision and self-
scheme. The analysis suggests a new perspec- imposed strategic limitations on the part of the
tive, which can result in cross-fertilization of firm.
ideas and, in turn, produce innovative market- Finally, the analysis suggests a new perspec-
ing strategies. This article will briefly review tive for the firm;a recommendation for seeking
the different explanations of Marketing innovative marketing strategies in order to
Myopia and then classify the types along two remdve some of the myopia-caused restrictions
dimensions. on the mnge of stmtegic options.

Michael D. Richard is Assistant Professor of Marketing at Mississippi State University. He received his Ph.D. hom the
University of Alabama Dr.Richard's research and publication interests include choice models, market share models, and
marketing strategy.
Jamas A. Womack is a graduate student at Auburn University. Mr. Womack's research interests include marketing
strategy and personal selling.
Arthur W.Allaway is Associate Professor of Marketing at the University of Alabama. He received his Ph.D. from the
University of Texas. Dr. Allaway's research and publication interests include choice models, market share models, and
optimal control models.

Vol. 9 No.3 Summer 1992 65

- - __ .- -
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
THE JOURNAL OF CONSUMER M . ” G

Foundations of Murketing duced. Such firms are inward-oriented toward


the firm. For example, a firm can be defined as
Myopic a cold breakfast cereal firm.
Marketing Myopia was initially described as
a firm’s shortsightedness or narrowness when Firms with a single-industry per-
it is attempting to define its business.4
Marketing Myopia is analogous to a product spective are preoccupied with the
orientation, whereby the firm defines itself as a actions and reactions of immediate
product-producer. One alternative is a cus- competitors.
tomer orientation (i.e., the Marketing Concept),
whereby the firm defines itself as a satisfier of Firms can be more broadly defined by the
customer wants and needs; that is, the cus- nature of the customer wants and needs satis-
tomer orientation helps the firm to anticipate fied. These firms are outward-oriented toward
and adapt to changes in customer demand.4 the market. Thus a firm can be more broadly
defined as a breakfast foods firm.
The customer orientation has also been con-
sidered as a type of Marketing Myopia, Firms The second dimension concerns the firm’s
overemphasize the satisfaction of customer business environment perspective. In essence,
wants and needs8 and, as a result, have ignored these firms have an inward orientation toward
competition. A competitor orientation has been that industry. Firms with a single-industry per-
proposed as a replacement for the customer ori- spective are preoccupied with the actions and
entation: with this orientation, a firm’s strategy reactions of immediate competitors. In addition,
is influenced by its competitors.8 they are considered to have inbred manage-
ment. Some managers have spent the majority
Manager tenure has also created a type of of their professional careers in one industry.
Marketing Myopia. Some marketing managers Inbred management is not necessarily undesir-
possess too narrow a perspective as a result of able, but it is potentially detrimental when it
spending their entire career in a single indus- fosters the contention that it can learn nothing
try.’ This myopia fosters the erroneous mind- horn firms in other industries, and it keeps its
set that each industry is unique. It restricts the firm perceptually insulated from such other
firm’s ability to learn from the experiences of firms.For example, managers of the cold break-
firms in other industries facing parallel prob- fast cereal firm may be concerned only with the
lems and opportunities. actions and reactions of other cold cereal firms.
hh#Marketing strategies transcend industry Firms with a multi-industry perspective, on
boundaries.’ Finns can solve marketing prob- the other hand, have a broader outlook of the
lems and exploit opportunities by looking market. While they are concerned with immedi-
beyond immediate competitors €or strategies. A ate competitors, they also realize that firms in
broader perspective can result in cross-fertil- other industries can serve as sources of innova-
ization of ideas and, in turn, produce innova- tive strategies as well as being potential competi-
tive marketing strategies? tors. Such management is said to be cross-bred,
in that managers may have experience in a broad
Dimensions of Marketing range of industries or they are willing to learn
from firms facing similar situations in other
Myopia industries. Firms with a multi-industry perspec-
The preceding discussion suggests the need
for a systematic way to classify the types of tive are outward-oriented and not perceptually
Marketing Myopia. The types can be classified insulated from other industries.
along two dimensions. The first concerns man- These dimensions provide the manager with
agement’s definition of the firm. Firms can be a way to consider systematically the types of
narrowly defined by the type of product pro- Marketing Myopia.

66

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
AN INTEGRATED VIEW OF -GMYOmA

The combination of the two dimensions pro- organization by the type of products sold (gro-
duces a matrix with four scenarios: (I)Classic ceries). This definition led to the decision not
Myopic firm,with a product definitiodsingle- to add highly profitable non-grocery items as
industry perspective, (2) Competitive Myopic competitors did. The wants and needs of the
firm,with a customer definition/single-indus- consumer were also ignored. Consumers
try perspective, (3) Efficiency Myopic firm, increasingly desired such features as national
with a product definition/multi-industry per- brand merchandise, a deli, a seafood section,
spective, and (4) Innovative firm,with a cus- and extended hours. While A&P resisted these
tomer definition/multi-industry perspective. changes, other grocers were pleased to offer
While the dimensions are depicted as dichoto- these features. In essence, A&P failed to prac-
mous, they are actually continuous. A given tice the Marketing Concept.
firm may not always fall clearly in the center
A&P also had a single-industry perspective.
of any scenario, but may be positioned
throughout the matrix depending on the degree While other grocers looked to different indus-
of commitment to any of the dimensions. tries for distribution expertise (e.g., computer-
These scenarios are presented in Figure 1. ized warehousing), A&P adhered to outdated
methods of distribution. When faced with
Classic Myopic Firm extinction, A&P applied “grocery solutions” to
the problem: it engaged in aggressive price-cut-
The Classic Myopic firms are those associ-
ting to attract customers. However, this strate-
ated with a product definitiodsingle-industry
gy proved unsuccessful.
perspective. These firms are narrowly defined
by their product and so do not practice the Elgin Watch is a another example of the
Marketing Concept. They possess a single- Classic Myopic firm. Elgin defined itself as a
industry perspective, being concerned only producer of fine, traditionally styled, manual-
with the actions and reactions of immediate ly-wound watches. Elgin was not aware of the
competitors. Management is inbred, and since changing consumer tastes for watches, the fact
managers consider their industry unique, they that consumers increasingly desired low-
are unwilling to learn from firms in other priced and convenient (i.e,, self-winding)
industries. Because of the lack of cross-fertil- watches.
ization of ideas, firms with this type of Elgin Watch also had a single-industry per-
Marketing Myopia are limited in strategic spective. It was taken by surprise by a new
a1ternatives.
class of competitors entering the market. The
ALP serves as a prime example of the Classic semi-conductor manufacturers were seeking
Myopic firm. A&P’s management defined the applications for digital watches. They captured

67

- -- . - ____-. __-
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
THE JOURNAL OF CONSUMER h ” G

a large share of the market by offering the con- industry perspective, did not adopt the sophisti-
sumer low-priced, self-winding watches. In cated marketing techniques and, as a result, its
addition, they employed new channels of dis- market share was cut in half within five years.
tribution [mass merchandisers and discoun-
ters) which had been overlooked by Elgin. Effidmcy Myopic Firm
Competitive Myopic Firm The EfficiencyMyopic firms only partially
embrace the innovative firm idea.’ The
The Competitive Myopic firm is analogous
Efficiency Myopic firms are those associated
tb a compromise between the customer and
with a product definition/multi-industry per-
competitor orientations. These firms are asso-
spective. These firms are defined by the prod-
ciated with a customer definition/single-indus-
uct and so do not practice the Marketing
try perspective. They are defined by the
Concept. Since they have a multi-industry per-
customer wants and needs satisfied, and so
spective, they do look to other industries as
they practice the Marketing Concept. In addi-
potential competitors and as sources of solu-
tion, they have a single-industry perspective,
tions to problems. Managers are crossbred,
being concerned only with the actions and
and their experience in other industries, or
reactions of immediate competitors. Managers
their acceptance of the notion of similarities
are also inbred, adhering to the notion of the
between industries, contributes to their will-
uniqueness of their industry. Therefore they
ingness to learn from firms in other industries.
are not willing to learn from firms facing paral-
As a result of cross-fertilization of ideas, these
lel situations in other industries. As a result,
firms have somewhat more strategic alterna-
there is no cross-fertilization of ideas.
tives than the previous two myopic types.
While these firms practice the Marketing However, rather than looking to other indus-
Concept, they lack creativity in strategy. tries for marketing solutions, these firms, con-
Therefore, such firms are limited in their cerned with improvements in production
strategic alternatives. They tend to think in efficiency, borrow only technological innova-
terms of acceptable businesses or expansions tions. Their marketing managers assume that
for the industry they are in, and they are likely consumers desire less expensive and/or more
to mimic similar firms’ marketing actions. Line efficient versions of existing products, and so
extensions and “me-too” products are popular are apt to introduce new and improved ver-
strategies for this type of firm. sions of existing products.
Schlitz Brewing is an example of the General Foods serves as a prime example of
Competitive Myopic firm. It did practice the an Efficiency Myopic firm. While very success-
Marketing Concept with its customer defini- ful in food processing, General Foods did not
tion, as is evidenced by the introduction of a achieve success in the fast-food restaurant
myriad of product extensions (e.g., light beer business with its purchase of Burger Chef.
and premium priced beer). Management defined Burger Chef as a fast-food
hamburger restaurant. As a result of this prod-
When Philip Morris purchased Miller
Brewing, tobacco executives were brought in to uct definition, Burger Chef lost market share to
run the ailing brewing company. This infusion competitors that introduced such items as fish
sandwiches, chicken products, and a salad bar.
of talent was responsible for the introduction of
a host of marketing strategies to the brewing General Foods did possess a multi-industry
industry [e.g., product segmentation, target mar- perspective and attempted to apply food-pro-
ket advertising, and efficient distribution]. cessing skills to fast-food restaurants.
These ideas were also embraced by Anheuser- Unfortunately, the multi-industry perspective
Busch. As a result, the market share of both did not offset the problems associated with
soared. In contrast, Schlitz, which had a single- product definition.

68

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
AN INTEGRATED VIEW OF MARKETING MYOPIA

Recent woes at IBM demonstrates the prob- PC industry. Since Sculley became CEO of
lems associated with an Efficiency Myopic Apple, revenues have quadrupled and return
firm.6 IBM has defined itself by its product on shareholders’ equity is the highest in the
(computers). While Japanese computer firms industry.3 Much of this success is attributed to
deployed systems engineers to assist customers Apple’s new low-priced PC, the MacIntosh
in developing software (and gained valuable Classic. Some of the marketing strategies of the
customer information in the process), IBM soft drink industry appear applicable in the PC
declined to provide this service. The Japanese industry. Even the name MacIntosh Classic has
have used their knowledge of customer needs a cola counterpart (Coke Classic).
to capture market share in the mainframe com- In 1989 Xerox won the prestigious Malcolm
puter market. Baldridge National Quality Award while
regaining much of its lost market share.9 Much
Firms with a multi-industry per- of the Xerox success is attributed to its embrac-
spective have a broader outlook of ing of benchmarking. Xerox monitors perfor-
the market. mance in several product and service areas,
and the ultimate goal for each area is the level
While IBM’s expertise was in the mainframe of performance achieved by the world leader,
computer market, it proved that it had a multi- regardless of industry. For example, the bench-
industry perspective. As a late entrant to the mark is L.L. Bean for distribution and
PC market, IBM proved that it could produce American Express for billing.9 In that sense,
and market a new product. However, the Xerox epitomizes the multi-industry perspec-
multi-industry perspective has not enabled the tive. As a result, Xerox’s market share and cus-
company to capture lost share. tomer satisfaction have soared.

InnwcrtiveFirIxl The Innovative firm is associated


The Innovative firm is associated with a cus- with a customer definitiodmulti-
tomer definition/multi-industry perspective, It
possesses none of the narrowness of the previ-
industrv nerspective.
ous firms. These firms, being defined by the Wal-Mart Stores is still another Innovative
customer wants and needs satisfied, practice firm.1 Wal-Mart provides a variety of merchan-
the Marketing Concept. They also possess a dise at low prices to small towns in the United
multi-industry perspective, looking to other States, markets that have been ignored by other
industries as potential competitors as well as retailers. While many retailers subordinate dis-
sources for solutions to problems, and so they tribution to merchandising, Wal-Mart has bor-
apply innovative strategies borrowed from rowed sophisticated distribution practices
those firms. Management is cross-bred and from other industries. Such innovations as the
willing to apply new strategies to marketing handling of palletized quantities and a state-of-
problems and opportunities. the-art warehouse scanning system have low-
As a result of cross-fertilization of ideas, ered costs for Wal-Mart.1 Even the practice of
these firms enjoy a wide range of strategic greeting all customers as they enter the store is
alternatives. They are farsighted or flexible a borrowed strategy from the hotelhestaurant
enough to apply unique solutions to problems industry. Wal-Mart has enjoyed a meteoric rise
and opportunities. in the field of retailing.
One Innovative firm appears to be Apple The Innovative category implies a new per-
Computer.3 The hiring of John Sculley from spective on the part of the firm. First, the firm
Pepsico reveals Apple’s willingness to apply should seek to satisfy customer wants and
marketing strategies from the soft drink to the needs. Second, the firm should realize that

69

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.

~ ~ ~~~
THE JOURNAL OF CONSUMER MARKETING

other industries can be sources of innovative 2. Monitor other industries. You should be
strategies for reaching the consumer. Both aware of marketing strategies in a wide range
strategies are important in order to achieve of industries. These industries can serve as
performance objectives. Of course, the sources of innovative strategies for satisfying
Innovative firm will provide little benefit existing consumers as well as attracting new
without effective leadership to implement consumers. You might scan business publica-
these strategies. tions, as well as attend seminars where you
will be exposed to marketing people from
Marketing strategies transcend other industries.
industry boundaries. 3. Engage in benchmarking to determine the
objectives for relevant areas of marketing. Once
The Innovative firm is not intended as a cure you determine the objectives, you can develop
for Marketing Myopia, just as the Marketing a list of firms to emulate. Finally, analyze inno-
Concept was not meant as a cure.5 The vative strategies of the benchmark firms for
Marketing Concept has, in some cases, been possible adoption. The second recommenda-
carried to an unproductive extreme.5 The same tion above can help in benchmarking.
is possible with the Innovative firm perspec- 4. Recruit marketing people, Marketing man-
tive. However, what is important in this per- agers hired away from other industries can
spective is to not overlook other industries and bring new perspectives and solutions to mar-
thereby to remove some of the restrictions on keting problems. In essence, these people can
the range of strategic options. be “debriefed” when added to the management
team. In addition, brainstorming sessions
Managezlal - between these new and existing managers can
Recommendations yield new strategies.
For marketing managers who consider the 5. Be flexible enough to apply unique solu-
Innovative firm orientation desirable, the obvi- tions to problems. Also be flexible enough to
ous question is how to achieve it, Five recom- change unsuccessful strategies. Flexibility can
mendations are offered here. be fostered by upper management’s commit-
1. Take a generic view of your firm/industry. ment to flexibility and innovation. Manage-
Determine how the firm/industry has been ment must encourage marketing managers to
defined and consider a broader definition. A try new strategies without fear of reprimand.
firm’s statement of Corporate Mission can help In this era of global competition, the stakes
a firm define itself through examination of are enormous. Companies affiliated with
needs satisfied, lines of business engaged in, Marketing Myopia lack vision and impose
products sold, and so on. Rather than focusing strategic limitations on themselves. To remain
on the products produced, examine the needs competitive and survive into the twenty-first
satisfied as well as potential product substi- century, companies can combine the Marketing
tutes for those needs. The result should be a Concept and cross-fertilization of ideas for
broader definition of your firm and industry. innovative strategies.

End Notes
1. Bergmann, Joan,“The Saga of Sam Walton,”Ston?s, 70 (1988),129-142.
2. Houston, Franklin S.,“The Marketing Concept: What It Is and What It Is Not,” Journal of
Marketing, 50 (1986),81-87.
3. “John Sculley on Sabbatical,”Fortune, 119 (March 27,1989),79-80.

70

- - --
Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.
AN INTEGRATED VIEW OF MARKFXNGMYOPIA

4. Levitt, Theodore, “Marketing Myopia,” Hurvurd Business Review, 38 (1960),45-56.


5.Levitt, Theodore, “Marketing Myopia,” Harvurd Business Review, 53 (1975),26-44and 173-
181.
6.Loomis, Carol,“Can JohnAkers Save IBM?” Fortune, 123 (July15,1991),40-56.
7. Lovelock, Christopher H., “Classifying Services to Gain Strategic Marketing Insights,’’Journal
ofMarkefhg, 47 (1983],9-20.
8.Oxenfeldt, Alfred R., and William L. Moore, “Customer or Competitor: Which Guideline for
Marketing?”Management Review, 67 (1978).43-48.
9. “Pushing to Improve Quality,”Research TechnologyManagement, 33 (1990), 19-22.

71

- - - ___ .-
-

Reproduced with permission of the copyright owner. Further reproduction prohibited without permission.