Taming the beast of marketing myopia

Marketing myopia definition

Marketing myopia is a much-used word nowadays between marketing management academics, as well as professional marketers who work freelance or in a company’s marketing department.

The deeper concept and meaning of this marketing buzzword is increasingly felt in the business world, as its consequences have affected and continue to affect a large number of enterprises.

Although its extensive scale as a unique business phenomenon would justify its thorough analysis, in order for marketing researchers to discover, and for businesses to apply standard and effective measures to face the problem, contemporary analysis on marketing myopia seems to have stopped back in 1960, when Theodore Levitt published the original article in Harvard Business Review and set the theoretical framework for this new marketing term at the time.

The basic theory behind marketing myopia, and which serves as its definition, is that, a customer buys a product or a service in order to satisfy one or more of his/her needs or tastes, and not just for buying the product itself, for its own sake. Any product or service features, advantages and extras should serve the customer, and become a valid and strong reason and motive for the customer to purchase that product or service. Otherwise, the customer would not be interested in buying the product or service at all, and those special product or service features would be considered unnecessary adornments to blind the customer. Although they could possibly persuade the customer buy the product or service, they would prove to be an ineffective marketing tool in the long run.

Comparing marketing myopia with physical myopia

In many ways, marketing myopia has many similarities with physical myopia. The main similarity is due to the fact that both types of myopia are caused by loss of focus.

Therefore, in physical myopia, the eye fails to focus an image on the retina, while in marketing myopia, a company fails to focus its marketing efforts on a profitable area of activity, and instead, it orients its efforts and vision on irrelevant, unprofitable, and even loss-generating products, market segments, promotional methods and approaches, etc.

Similarly to physical myopia, where, although a patient can see objects that are near to him or her, he or she finds it difficult to see and recognize things in a distance, companies suffering from marketing myopia literally can’t see the wood for the trees. As a result, these companies make a huge waste of effort, missing other more profitable opportunities that may exist, at the same time.

In spite of the fact that, in a number of cases, physical myopia is due to specific genes, it can be the result of a living style that favors stay-at-home activities, such as reading, using the computer, etc., rather than activities that take place outdoors. Likewise, when a company adopts an introvert approach, it loses contact with consumers and also risks losing its actual customer base, developing a myopic approach, at the same time.

When physical myopia is not due to genetic factors, it results from a way of living that puts stress on the eye over time. Similarly, and in contrast to what is commonly held, marketing myopia does not happen overnight. On the contrary, it is a process of small failing signs that are ignored and slowly accumulate with time, leading to the point where no action can be taken to resolve the problem, because it’s too late.

Undoubtedly, medicine is a constantly evolving science, and the same applies to business management. As a result, a company that has a marketing myopia problem is not very different to an actual patient with physical myopia, and since the best course of action that the latter can take is to visit a specialist eye doctor, the same should be done by a company, in order to get advice and help on how to correct the problem, i.e. its myopic vision.

Certain types of corrective measures can and should be taken at an early stage. Similarly to physical myopia, the sooner is marketing myopia diagnosed in a company, the sooner and more effectively it can be treated and cured, through the assistance of marketing and management professionals, helping the company to take its destiny in its hands and adopt a different approach that will save it from going down.

Another point that should be stressed is the level and effectiveness of communication that is implemented in a specific company, and it would not be an exaggeration to say that an effective network of internal communication within a company can help it in keeping any marketing myopia issues at bay. The role played by internal communication within a company is similar to the role played by the nervous system in transmitting the signal from the retina, where the eye focuses the image, to the brain, in order for it to be processed. Therefore, if problems, even minor ones, are not reported as early as possible and are kept ignored, chronic and uncured marketing myopia will develop sooner or later, with devastating and irreparable effects.

Not to say that, similarly to diseases that are concomitant or subsequent to physical myopia, such as glaucoma and cataract, marketing myopia is not free of side effects, as well, since it can cause major disruption to the company’s overall operation and the activities that are carried out by the company’s various departments.

Sadly, in an era of such a tremendous and instant availability of a wealth of information, marketing myopia is still a real issue that occurs in the business world, perhaps due to the fact that many companies insist on adopting old-fashioned and outdated marketing approaches that are actually based on myopic vision.

The opportunity cost of marketing myopia

Since marketing myopia is a chronic disease, as is physical myopia, its impact on a company is not limited to a specific period of time, but it is rather spread over the entire lifecycle of a company’s operation. As a result, its cost is very high in the long run, to the point that it can cripple down a business.

It could be argued that this type of cost is the result of a company’s faulty, inefficient, and unprofitable operation, which is, of course, true, although this simplification fails to provide a more insightful explanation of why a company operates at a high cost and generates losses.

The concept of opportunity cost could provide a deeper explanation in that direction. Opportunity cost is a “hidden” cost, in the sense that it is not readily evident, as is the cost of purchase of raw materials, for example. On the contrary, opportunity cost can be estimated on the basis of making a comparison between employing different types of production resources and methods to attempt to exploit different market opportunities. Directing a company’s full efforts and resources towards the production of a specific product or service for a specific market, can deprive a company of the opportunity to use its resources and efforts more effectively and efficiently, by trying to launch a different product or service, or penetrate a different market.

This type of cost, although “hidden”, is very real, and actually, this analysis shares many common things with the analysis of the marketing myopia phenomenon.

Therefore, the damage that a company does to itself, as a result of its myopic approach to the market, is not very different to the damage that is caused, when a company continues to ignore the opportunity cost that it pays in the long run.

I believe that this argument is also in line with the critical question that was asked by Theodore Levitt in his seminal article: “What business are you in?”, which was published in Harvard Business Review, when he taught at Harvard Business School back in 1960.

An entrepreneur’s ignorance of the business that he or she is in also implies his or her ignorance of how else he or she could better use his or her company’s resources to attempt to sell products or services to a different market, that his or her company could have the ability and capacity to serve profitably.

In other words, if an entrepreneur lacks or ignores the required knowledge to estimate the relevant opportunity cost that is involved in the conduct of his or her business, he or she is prone to develop a myopic vision of the market.

How marketing myopia can be identified in cases of “green business” failure

Once upon a time, anything ecological or “green” was generally accepted as a good thing for society, so businesses thought that they wouldn’t be too wrong if they added “green” features to their products or services. They probably thought that they had discovered an unbeatable marketing competitive advantage, and that customers would buy those “green” novelty products whatever the price.

How wrong they were!

Huge corporations like Philips, Whirlpool and Mobil learnt their lessons the hard way, when they had to face massive marketing failures, because they misinterpreted the motives behind the consumer decision-making process that affected the purchase of their “green” products. Other companies, as diverse as Toyota and Tide were smart enough to learn from the mistakes of other companies and not repeat them.

Is green marketing myopia a paradox?

According to an article written by Jacquelyn Ottman, with the title: "Avoiding green marketing myopia: Ways to improve consumer appeal for environmentally preferable products", green products failed because their producers were unable to identify correctly the specific needs that consumers wanted to satisfy by purchasing them. The author argued that companies failed to recognize the real demand drivers, which were mainly based on common-sense factors, such as convenience and suitability of use and trust in the perceived benefits.

However, the same author, in her article: "Avoiding green marketing myopia and the Sunchips Snacklash", acknowledged the fact that consumer decisions are not always based completely on common sense.

Who could have predicted that a pack of crisps would become a market failure just because the wrap material was too noisy, despite the fact that, overall, it was a green product and it would be expected that consumers would be motivated to buy it.

On the contrary, as it was later shown, consumers have a very sensitive taste, and they can vote for or against a product, with their buying decision being totally unpredictable on many occasions.

Consumer is still king. It doesn't matter, for example, if it is recommended by wine experts to drink red wine in room temperature, because, in different circumstances, and depending on individual taste, anyone has the right-and nobody can take this right from the consumer-to drink cold, frozen or even hot red wine!

So what do marketing departments have to say on this type of attitude?

Nothing really…

They have to follow consumer tastes and demand and adapt to them, as these apply to their existing customer base and prospective customers. Otherwise, they will simply cease to exist.

Ethical aspects of sustainability marketing myopia

Business management gurus and analysts in the caliber of Levitt and Ottman have contributed a lot to the definition, interpretation and analysis of marketing myopia. Although this "marketing disease" was first identified and defined in the 1960s, it still remains an unpredictable problem for many companies.

It would not be an exaggeration to compare marketing myopia to a modern-day multi-headed monster that threatens businesses; just like the Hydra beast, every time a heroic “Hercules” (CEO) cuts one of the beast’s heads, a new head grows in its place! Marketing myopia can take numerous different faces, and its unpredictable nature is the reason why so many well-established companies have become its victims.

When companies are affected by marketing myopia, it finally becomes clear that it is due to their own misjudgment. The customer is always right and they should never get the blame.

This is true, with the exception of one particular case, i.e. sustainability marketing myopia.

In the history of capitalism it is very rare for a company (with the exception of non-profit organizations, of course) to develop and promote products and services just for the sake of ethics. Profit has always been the name of the game, and since profit is generated by sales, the final goal is to get a share of what is inside consumers' pockets and wallets (bank accounts and cards nowadays) by selling them whatever suits consumer needs.

So, in the case of sustainability marketing myopia, can the application of "green ethics" to products and services motivate consumers to buy specific products and services?

The answer is partially yes, when those products and services offer higher or at least equal value to consumers than non-green product and services do.

In other words, consumers would prefer an environmentally harmful product or service, if it is, for example, cheaper to them than other similar environmentally friendly products or services that are sold at a higher price. A number of companies have learnt hard lessons from this consumer attitude.

Companies, as they attempt to attract customers by stimulating the environmental awareness of the latter, throw green products and services in the market.

However, saving the environment on their own expense does not seem to be a priority for the majority of consumers, especially in the absence of other benefits. This micro behavior that develops on an individual level grows into a macro-trend that is reflected in the market, and is expressed as a rejection of green products, implicitly declaring that “environmental friendliness”, in its own right, is not enough to attract customers.

Sustainability marketing myopia is one of the cases where companies should not be blamed (or at least they should be blamed only for their own failure to produce sales and profit!).

Going green is an ethical and rational decision practice, which, however, is not shared by consumers in many cases.

While there is so much public protest against companies' acts against the environment, there is not a single voice to point out the fact that consumers are as ethically responsible towards the environment as companies are.

Some examples of marketing myopia in the UK supermarket industry

In recent years, a major characteristic of the supermarket industry has been the advent of discount chains, such as Lidl and Aldi, which has brought about a strong shift in the market.

Long-established supermarket chains have faced fierce competition from those “super discounters” to the point that the former’s very existence is threatened, with many big names in the supermarket sector disappearing from the market, as a result of their inability to cope with such a strong competition.

However, in this case, as well, the mere fact that these well-established familiar names in the supermarket industry didn’t see disaster coming is just another case of marketing myopia.

Because, not that long ago, in the UK, for example, supermarket giants, such as Tesco, Asda, Morrisons, and Sainsbury’s (maybe I miss a name or two) were engaged in a price war, as a result of their narrow-sighted approach, which was based on the assumption that consumers considered price as the only factor when doing their shopping.

In this way, they failed to recognize the existence of potential opportunities that waited to be discovered by those brave, adventurous, and risk-taking supermarket bosses and managers who could adopt an innovative and differentiated approach that would not rely solely on price.

After all, the supermarket chains that now complain about the dominance of the market by hard discounters were the same ones that actually introduced price-cutting strategies to dominate the market just a few decades ago. However, it looks like their long-term planning didn’t stand the test of time, perhaps, due to the fact that cutting their prices and offering discounts was not the result of real innovation in their supply chain, for example, which has been an area of major focus for firms like Aldi and Lidl.

Therefore, it is doubtful whether those “traditional” supermarket chains have actually managed to answer effectively and efficiently the all-important question that was asked by Levitt in 1960, i.e. “What business are we in?”, because if they had successfully done so, they wouldn’t have been defeated by Lidl and Aldi in their own ground. On top of that, it should be stressed that this question could be answered differently, let’s say, in the 1980s or 1990s, than in 2019.

It wouldn’t be an overstatement to say that supermarket chains like Tesco and Asda were hit by the same form of marketing myopia that caused the demise of the old grocer’s shop and the corner shop; now, it was Lidl and Aldi that paid them back with same coin. However, and don’t get me wrong, the market constantly evolves and changes, and Lidl and Aldi should not rest on their laurels, otherwise they would face the same risk and become the next victim of marketing myopia.

Even hard discounters make mistakes and their methods and techniques are not perfect, and the fact that they have found the right mix to offer their products to consumers at unbeatable prices, while they still manage to make a profit, may not prove to be an equally successful strategy, let’s say, in ten years’ time; marketing myopia is lurking around the corner, and they should always keep an open eye due to unexpected market shifts.

Perhaps, the size of a company plays a key role regarding whether that specific company will develop marketing myopia, or not, and the numerous examples of companies across various industries and sectors, which fell victims of marketing myopia, support this assumption.

Therefore, when a company is still small, it can focus its efforts better, in order to serve its market efficiently, which means that it can identify more accurately the area of its business, i.e. it can answer Theodore Levitt’s critical question much more effectively and with more confidence.

On the other hand, an increase in the size of a company may have certain benefits, such as enabling the company to take advantage of economies of scale; however, it can also hide other risks, one of which is the danger of developing a myopic marketing approach.

Growing in size almost inevitably means the applying control to the company’s operations becomes a more challenging task for its managers, which may result in a loss of focus and direction.

Similarly, appealing to a larger market may also cause loss of focus, since it becomes increasingly difficult to accurately identify consumer needs and serve them efficiently.

Personally, and although we currently live in the era of globalization that favors large-scale business, both horizontally and vertically, I believe that a single-product producer or retailer could prove to be a more efficient economic model in the long run, and I can testify to that, because I know of a local patisserie (a traditional family business) that has kept making and selling exactly the same product and using the same recipe for many decades, with unprecedented success, which has much to do with their insistence to focus and serve well a small and loyal market. In exchange, this small patisserie has never suffered from marketing myopia, and it never will, because it knows its limits, it is not greedy, and leaves room for other patisseries to sell their own products and make a living in a sustainable market, as well.

How to diagnose marketing myopia

When you have reached the top of the mountain, then the only way is going downhill.

The same statement applies to companies. After they have reached success, the countdown starts right away, and they will have to fight really hard to stay on top and don't let themselves go downhill.

Maintaining success requires a high level of organization and discipline. By repeating the good habits that led a company to the top and aborting all kinds of negative and counter-productive behavior and mentality, it will be able to enjoy sustainable success.

Innovation also requires a high level of sound organizational structure. Research should be focused and targeted and not be left to fate.

Since innovation is the most important factor in preventing and fighting marketing myopia, it is understood that companies should adopt a more open-minded approach in assessing market trends.

At the same time, all efforts for company growth should be clear and easily audited, in terms of effectiveness and efficiency.

The process of the diagnosis and prevention of marketing myopia is a continuous one. Success and failure are the opposite sides of the same coin. In order for a company to remain profitable and successful, it should review its already winning strategy and challenge it within an ever-changing market environment. It should also check whether the current strategy is consistent to what consumers really want, and to what extent, the company has the ability to offer them.

When a company has reached the peak of success, it should immediately perform a diagnosis test to check if it suffers from marketing myopia, because, when marketing myopia finally shows its ugly face, it is usually too late to change outdated and ineffective marketing practices.

How to overcome marketing myopia

As it has already been mentioned, much discussion has been raised on marketing myopia since Theodore Levitt literally discovered the term back in 1960.

In spite of this, there are many companies that have failed to successfully deal with this issue, resulting in them suffering from this “illness” over the years.

Actually, the examples of those companies served as marketing myopia case studies to avoid.

Nevertheless, there still seems to be a high level of ignorance among enterprises, especially when it comes to finding ways to overcome marketing myopia.

Identification of a company’s customer base

The correct identification of a company’s customer base can help any company to keep marketing myopia at bay.

A company’s failure to correctly identify its customers will ultimately restrict the company’s ability to serve the needs of those customers effectively.

In an era when consumers are bombarded with information from companies wishing to sell to them, they finally manage to rise as “kings”, and they are literally spoilt for choice.

Therefore, one way for companies to avoid any marketing myopia problems is by identifying and focusing on serving the needs of a specific niche market, rather than being a jack of all trades.

Conduct effective market research

Market research, when performed effectively, can prove to be a major weapon in the fight against marketing myopia.

On the other hand, a company should be very careful during the evaluation of results of market research that it has conducted, about, for example the launch of a new product.

If market research is based on false or unrealistic assumptions, there will be a high risk for it to result in marketing myopia. In this way, marketing research can do more harm than good.

Thus, the key purpose of marketing research should be to provide well-grounded market information and data, through the effective use of which, a company can be protected against marketing myopia.

Create realistic market expectations

It is argued that, by adopting a more long-term approach, companies have more chances to prevent marketing myopia from happening.

Although this can be true in some cases, avoiding a myopic marketing approach has to do more with setting realistic goals regarding a company’s market, rather than choosing long-term over short-term goals.

If a company only cares about its long-term strategy but forgets to equally pursue its day-to-day goals, such as maintaining a healthy cash flow on a daily basis by serving current consumer needs and market trends, it may be suffering from marketing myopia, as well, in spite of the fact that the horizon of its goals is set in the long run.

In this line, market expectations should be set neither too high nor too low, but rather on a realistic level, and first of all, according to the company’s current production potential and capacity.

Unless a company can have at least some income from current rather than future sales, it won’t be able to go too far.

Sources and further reading:

Marketing myopia, by Theodore Levitt, as published in Harvard Business Review

“Marketing myopia” myopia

Sustainability marketing myopia

Avoiding green marketing myopia: Ways to improve consumer appeal for environmentally preferable products

Avoiding green marketing myopia and the Sunchips Snacklash

What is marketing myopia – Definition

Facts about myopia

Marketing myopia: Consumer needs, organizational restructuring and recovery

Marketing Myopia: Causes, Examples, and Solutions

"Marketing Myopia: The Companies That Failed and the Ones That Survived"​