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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). Railroad Story. Railroad business: WAS:

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Marketing myopia
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)

Sheu


Railroad story
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

Sheu


Oil industry story
Oil Industry Story

  • Thought ever-growing population guarantees growth. (石化工業已不若當年風光. 拜耳 / 六輕)

  • Narrowly defined as oils industry.

    • Providing: crude oil and gas. R&D on oil exploration and refinery efficiency. (Not on improv. Generic product & market)

  • Episodes:

    • Kerosene -> electric lamps <space heater (oil) to rescue>

    • Space heating -> central heating (coal) <intern. comb. Eng (ICE). To rescue>

    • ICE -> Car gas level off <aviation fuel>

    • Central heating -> Natural gas.

      • Oil co. own gas but resist the dev of gas usage. Lost business to a new industry. => narrowly perceived self as oil producer not energy provider.

  • ALL substitutes are from outside the industry. <lost oppr.>

  • Moral(寓意): (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)

  • Sheu


    中鋼 case

    • Taisil company (中德):中鋼 & Hughes <= 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 2~3 yrs.

  • A steel producer => material component provider

    • Satisfying material needs for downstream industries.

    • Core competence: material science.

  • Sheu


    Product vs market vs sales oriented
    Product vs Market vs Sales Oriented

    • Product-oriented vs Market-oriented

      • Company tends to be product-oriented.

        • Demise of a major typewriter company. (~30 -> 5000 -> 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. <typewriter>

    • Sales vs Marketing

      • Sales: getting the product out of the door. (seller needs)

      • Marketing: satisfying customers’ needs.

    Sheu


    Ford production philosophy
    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.

    Sheu


    Principles
    Principles

    • Mgmt think of itself not as producing productsbut as providing customer satisfaction creating customer value. <Using core competence>

    • Internalize the idea to the whole organization.

    • Stimulate/excite employees. (口號, 精神指標)

    • Continuously reminding.

    • These principles are the same for pushing IT or any major ideas w/i the company.

    Sheu


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