The Business Book

(Joyce) #1

248


serious endeavor worthy of
management attention; instead
it was a formulaic task left to the
sales or production departments.
But “Marketing Myopia” prompted
both the corporate and academic
worlds to start thinking differently.


Taking marketing seriously
Around the same time that Levitt
was writing that pivotal article, he
inspired a student, Philip Kotler,
who would take his proposition
further to cement a fundamental
change in the way managers
approached business. Kotler
studied at Harvard in 1960 for his
postdoctoral work in mathematics,
having already completed a PhD in
economics at the Massachusetts
Institute of Technology (MIT).
Exposed firsthand to the ideas of
Levitt and other marketing
professors, he began to develop a
rigorous outline for the role of
marketing in any organization. The
result was published in 1964, and
Marketing Management is still
regarded as the seminal textbook on
the subject. It is credited with being


the first book to take a scholarly and
scientific approach to marketing.
Kotler’s key teachings are that the
customer should be at the center of
any business, and that profit is
derived not merely from selling but
from delivering satisfaction to
customers: thinking which is still at
the core of most MBA programs.
The effect of Levitt and Kotler’s
ideas on the corporate world was
almost immediate. In 1962,
executive Robert Townsend had
just been lured from American

MARKETING MYOPIA


Express to take up the position
of CEO at struggling car rental
company Avis. He rebuilt the
business by focusing on two
interdependent principles: put
customers first; and create a
working environment in which
employees love what they do. For
the first time the business began to
make a profit.

Customer service
By 1964 Avis was expanding. The
man appointed as manager of
operations in Europe, Africa, and
the Middle East, Colin Marshall,
was another believer in Levitt’s
customer-centered approach, and
deployed it with great success.
Within ten years he was running
the entire company from New York,
overseeing innovations that gave
customers better service, and
making Avis the market leader. In
1981, when he was recruited to help
save British Airways (BA), he
turned around the fortunes of the
airline in a tough environment,
creating a successful model of
service-oriented business. His

Farsighted marketing is adaptable,
allowing businesses to shift their focus
to reach a wider range of consumers
with a broader product offering. Returns
can then be much greater.


Shortsighted marketing focuses on
current customers and their needs but
overlooks potential new markets,
leading to missed opportunities and
more modest profits.


The entire corporation must
be viewed as a customer-
creating and customer-
satisfying organism.
Theodore Levitt
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