Marketing Myopia

1
Marketing Myopia

• What is Marketing Myopia?
• failure to see customer-need-oriented business
  (vs product/service-oriented business)
• Every major business was once a boom business
• There is no such thing as a growth business
  (perpetually)

2
Railroad Story

• Railroad business
• WAS
• Early 90s speed, flexibility, durability,
  economy, full of growth
• Many royal customers. Investors rush to invest
  its stocks
• A tradition, code of honor, source of poetry,
  most solemn machine.
• Declining is unthinkable.
• IS
• Overtaken by planes, bus (?)/taxi/own car.
  Rapidly shrinking industry.
• Low-class riders shabby machine/vehicle
• Great operation loss.
• WHY ???
• in rail business instead of in transportation
  business

3
Oil Industry Story

• Thought ever-growing population guarantees
  growth. (???????????. ?? / ??)
• Narrowly defined as oils industry.
• Providing crude oil and gas. RD on oil
  exploration and refinery efficiency. (Not on
  improv. Generic product market)
• Episodes
• Kerosene -gt electric lamps ltspace heater (oil)
  to rescuegt
• Space heating -gt central heating (coal) ltintern.
  comb. Eng (ICE). To rescuegt
• ICE -gt Car gas level off ltaviation fuelgt
• Central heating -gt Natural gas.
• Oil co. own gas but resist the dev of gas usage.
  Lost business to a new industry. gt narrowly
  perceived self as oil producer not energy
  provider.
• ALL substitutes are from outside the industry.
  ltlost oppr.gt
• Moral(??) (cf morale)
• Seemingly evergreen yet was of luck
• Decline is unavoidable - indeed.
• Product-oriented vs market need - oriented
  (substitute energy needs)
• Missed opportunities to others. (eg.
  Natural gas)

4
?? case

• Taisil company (??)?? Hughes lt German company
• What steel company has to do with semiconductor?
• Commodity product vs Custom-made product
• Aggregate MKT driven vs individual customer
  driven.
• 0.9999 purity control vs 0.999999999999 purity
  contr.
• Millions of tons vs millions of grams
• Tech. turnover 20 30 yrs vs 23 yrs.
• A steel producer gt material component provider
• Satisfying material needs for downstream
  industries.
• Core competence material science.

5
Product vs Market vs Sales Oriented

• Product-oriented vs Market-oriented
• Company tends to be product-oriented.
• Demise of a major typewriter company. (30 -gt
  5000 -gt 0)
• If you do not obsolesce yourself, others will do.
• (Continuous product improvement change product
  CATEGORY to satisfy customer needs.)
• Consider yourself as serving a more generic
  customer needs
• using your core competency to serve a need
  provide a value
• Not just providing a specific product - even
  continue to improve on that prod.may not be
  enough. lttypewritergt
• Sales vs Marketing
• Sales getting the product out of the door.
  (seller needs)
• Marketing satisfying customers needs.

6
Ford Production Philosophy

• Traditional
• Mass production to get cost down. Sales to get
  the product out.
• Price is determined by how much can the
  production/engr. lower the cost. Customer to
  choose from what are produced.
• Manufacturing oriented
• Ford 500 car. (500 salary level will suffice
  to buy a car.)
• Find what price level intended customer will buy
  the car.
• Trace backward to force engr/mfg to reduce cost
  or rearrange features of product.
• Market oriented.

7
Principles

• Mgmt think of itself not as producing products
  but as providing customer satisfaction creating
  customer value. ltUsing core competencegt
• Internalize the idea to the whole organization.
• Stimulate/excite employees. (??, ????)
• Continuously reminding.
• These principles are the same for pushing IT or
  any major ideas w/i the company.