9 MM MKT Myopia

Marketing
Management
C-8 / MKT Myopia/

PGDM-2018 /RCM A publication of
Dr. Rajesh K Satpathy

Volvo Trucks Corporation Volvo FE Series of Trucks
What is Marketing Myopia?
Marketing Myopia refers to the phenomenon of not being able to see a
long term and more sustainable goal for an organization.
For decades, the term Myopia is being used in human sciences referring to
Nearsightedness – the ability to see near objects clearly but inability to see
the far off objects.
Marketing Myopia, as a term, makes it very clear the inability of the

company to be able to identify the actual business in which they are.
What is Marketing Myopia?
Defn: “Marketing Myopia refers to the phenomenon where the

Company focuses more on the product (development) instead
of focusing more on the benefits of the product to the
customers”.
Marketing Myopia- Cases
Marketing Myopia in the Transportation Business…
A lot of companies operating globally in the railroads business have faced

stagnation of growth in their line of business. What they have failed to
realize is that they are not merely in the railways or railroads business. They
are actually in the business of transportation and at a time where there are
more and more newer ways to commute… their railroads business will
definitely take a hit.
So basically while crafting their diversification plans the companies should
consider a holistic picture of transportation as a business and not just
railways or railroads.
This stands to be a classic example of Marketing Myopia.

Power Watch from Matrix Industries
Power Watch from Matrix Industries

Marketing Myopia in Entertainment Business:
Hollywood had a narrow escape few years ago when the leading
production houses faced a financial crunch. Almost all of them underwent
major restructuring. Why all of this happened? Simply because Hollywood
assume that they are in the business of making films and did not consider
TV as a threat.
What they didn’t realize was the simple fact that they are not in the
business of just movies but entertainment as a whole and tomorrow if the
consumer has different sources of entertainment their product i.e. movies,
will definitely take a hit.
However, Hollywood managed to escape this Marketing Myopia, as they
sooner realized TV as a potential growth opportunity for them… It was
then when 21st Century Fox, Buena Vista etc. entered into TV production as
well and had survived.
Marketing Myopia in British Apparels Business:
Decades ago, Dry Cleaning was one of the most sought after line of
business. Worldwide increasing number of wool products led to this ‘then’
very lucrative business. However, what the dry cleaning firms didn’t realize
was the fact that they were not merely in the dry cleaning business but
were in the business of apparels.
As new fabrics arrived, the market share of wool products started going
down. Synthetic fibers started gaining more popularity and thereby dry
cleaning business suffered.
Marketing Myopia in Indian Retail Stores:
Once considered to be the bread and butter of many households, now

retails stores face a threat from a supermarkets, online shopping etc. What
these households running Mom & Pop Shops do not realize is that they
are not merely in the business of selling their products to nearby areas,
they are in the business of quick & easy access of groceries.
Supermarkets came into the picture because of convenience.

Marketing Myopia- Conclusion
Overseeing a broader holistic picture in business makes it more
sustainable. Organisations should not only take care of their own product
into account while gauging competition but also factor in other threats
which might pop up because of being in that business.
We should not fall a prey of myths like – population will grow so, our sales
will grow.
The 80:20 Rule / Pareto Principle
The 80:20 rules, equally well known as the Pareto Principle, is widely used
and abused in business… but how does it apply to marketing?
Pareto Principle is named after Italian Economist Vilfredo Pareto, who
noted in 1906 that 80% of the land in Italy was owned by 20% of the
population.
Apparently Pareto developed what would later be known as his principle

by observing that 20% of the pea pods in his garden contained 80% of the
peas! Although there is some doubt whether he mentioned the 80:20
principle as such.
Applying the Pareto’s principle to marketing…
• 80% of profits come from 20% of customers
• 80% of product sales from 20% of products
• 80% of sales from 20% of advertising
• 80% of customer complaints from 20% of customers
• 80% of sales from 20% of the sales team

Customer Pyramid
The customer pyramid approach is a way to expand on the Pareto Principle
and further break down your customer base for business efficiency. At the
top of your pyramid is the platinum level, or the top 20 percent of
customers.
Just below are the gold customers. In a highly profitable company, gold
customers also contribute to profits and might eventually become part of
the core group. Getting them engaged in loyalty programs is helpful.
Customer Pyramid
The next tier, the silver group, may or may not include profit-generating
customers. These are more cost-conscious customers, so the key to
retaining them is to provide basic services at minimal costs.
The bottom of your pyramid are the lead weight customers. These
customers are typically unprofitable. They demand time, resources and
services, but are unwilling to pay for them!!!
So at a simple level, the Pareto principle should remind us about our time management when
managing marketing. We should focus our time on our main customer segments, most popular
products and the biggest causes of customer dissatisfaction.
The 80:20 Rule / Pareto Principle
Pareto’s Principle is useful in managing marketing to prompt us to think
where we should put our focus…
We can generalize that:
• 20% of inputs creates 80% of the outputs…
• 20% of effort leads to 80% of the results…
• 20% of causes lead to 80% of the consequences…

Thank You !!

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Marketing

C-8 / MKT Myopia/

Dr. Rajesh K Satpathy

Marketing Myopia, as a term, makes it very clear the inability of the

Defn: “Marketing Myopia refers to the phenomenon where the

A lot of companies operating globally in the railroads business have faced

This stands to be a classic example of Marketing Myopia.

Power Watch from Matrix Industries

Once considered to be the bread and butter of many households, now

Supermarkets came into the picture because of convenience.

Apparently Pareto developed what would later be known as his principle

• 80% of profits come from 20% of customers

• 80% of product sales from 20% of products

• 80% of sales from 20% of advertising

• 80% of customer complaints from 20% of customers

• 80% of sales from 20% of the sales team

We can generalize that:

• 20% of inputs creates 80% of the outputs…

• 20% of effort leads to 80% of the results…

• 20% of causes lead to 80% of the consequences…

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