This paper examines Theodore Levitt's most lasting contributions to business and marketing practice as outlined in his 1975 Harvard Business Review essay "Marketing Myopia." It explores four key principles: the necessity of customer orientation over product focus, the myth of perpetually growing industries, the dangers of narrow product innovation, and the risks of overreliance on R&D at the expense of consumer insight. Drawing on examples such as Hollywood, Apple, GM, and the oil industry, the paper illustrates how Levitt's framework remains relevant to contemporary business strategy and consumer-centered thinking.
According to Theodore Levitt's influential essay "Marketing Myopia", first and foremost it is vital that businesses remember they are in the business of serving consumers, rather than serving their own ends. Hollywood is not in the motion picture business — it is in the entertainment business. The fact that 21st-century Hollywood understands the need to be customer-oriented is manifested in the many tie-ins it has orchestrated with DVD releases, video game adaptations, and celebrity-related promotions, all tailored to meet consumer demand and the rapidly changing media economy. Most successful companies are not known for producing a singular product; rather, they have learned to morph and adapt their offerings in response to current consumer needs.
Being product-focused means that once a product — or a specific mode of product delivery — becomes obsolete, there is no longer any need for the company's existence. Apple's shift to handheld, mobile technology away from the desktop PC focus that defined earlier computer companies has been the key to its success. Companies that remain fixated on a single product or delivery mechanism risk irrelevance the moment that product is superseded by new technology or changing consumer preferences. The lesson is clear: a customer-forward orientation, rather than a product-forward one, is what sustains long-term viability.
There is no such thing, Levitt argues, as a growth industry — or an industry with infinite potential to expand. New technology will always step in and change the marketing dynamic, as manifested in the decline of Blockbuster and the rentable movie model. Even the oil industry, Levitt counsels, is not immune to the pressures of change. Companies cannot rely upon an infinitely expanding population and mass production. Substitutes are always available, and tinkering with a product in a narrow way is not a substitute for real innovation — no amount of incremental improvement could have saved the buggy whip industry.
Although Levitt's predictions about electric cars were somewhat premature and the oil industry still remains highly profitable, it is not impossible that green energy will eventually make significant inroads on its profits. There is certainly demand to find alternatives, given that — as Levitt notes — people have no particular affection for gas stations. Gas stations are a means to an end; gasoline is not a pleasurable or differentiated product. Because it is not customer-focused in any meaningful sense, consumers wish they could avoid patronizing gas stations altogether.
"GM versus Ford on innovation and consumer focus"
"Apple's success through user-centered design"
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