One more time – what is marketing? 5
self-interest. Given the enormity and self-evi-
dent nature of unsatisfied demand and the
distribution of purchasing power, it is unsur-
prising that most managers concentrated on
making more for less and that to do so they
pursued vigorously policies of standardization
and mass production. Thus the first half of the
twentieth century was characterized in the
advanced industrialized economies of the West
by mass production and mass consumption –
usually described as a production orientation
and a consumer society. But changes were
occurring in both.
On the supply side the enormous concen-
tration of wealth and power in super-corpora-
tions had led to legislation to limit the
influence of cartels and monopolies. An obvi-
ous consequence of this was to encourage
diversification. Second, the accelerating pace
of technological and organizational innovation
began to catch up with and even overtake the
natural growth in demand due to population
increases. Faced with stagnant markets and
the spectre of price competition, producers
sought to stimulate demand through increased
selling efforts. To succeed, however, one must
be able to offer some tangible benefit which
will distinguish one supplier’s product from
another’s. If all products are perceived as
being the same then price becomes the distin-
guishing feature and the supplier becomes a
price taker, thus having to relinquish the
important managerial function of exercising
control. Faced with such an impasse the real
manager recognizes that salvation (and con-
trol) will be achieved through a policy of
product differentiation. Preferably this will be
achieved through the manufacture of a prod-
uct which is physically different in some
objective way from competitive offerings but,
if this is not possible, then subjective benefits
must be created through service, advertising
and promotional efforts.
With the growth of product differentiation
and promotional activity social commentators
began to complain about the materialistic nature
of society and question its value. Perhaps the
earliest manifestation of the consumerist move-
ment of the 1950s and 1960s is to be found in
Edwin Chamberlin and Joan Robinson’s articu-
lation of the concept of imperfect competition
in the 1930s. Hitherto, economists had argued
that economic welfare would be maximized
through perfect competition in which supply
and demand would be brought into equilib-
rium through the price mechanism. Clearly, as
producers struggled to avoid becoming vir-
tually passive pawns of market forces they
declined to accept the ‘rules’ of perfect competi-
tion and it was this behaviour which was
described by Chamberlin and Robinson under
the pejorative title of ‘imperfect’ competition.
Shades of the ‘hidden persuaders’ and ‘waste
makers’ to come.
The outbreak of war and the reconstruction
which followed delayed the first clear state-
ment of the managerial approach which was to
displace the production orientation. It was not
to be selling and a sales orientation, for these
can only be a temporary and transitional
strategy in which one buys time in which to
disengage from past practices, reform and
regroup and then move on to the offensive
again. The Americans appreciated this in the
1950s, the West Germans and Japanese in the
1960s, the British, belatedly in the late 1970s
(until the mid-1970s nearly all our commercial
heroes were sales people, not marketers – hence
their problems – Stokes, Bloom, Laker). The real
solution is marketing.Marketing myopia – a watershed
If one had to pick a single event which marked
the watershed between the production/sales
approach to business and the emergence of a
marketing orientation then most marketing
scholars would probably choose the publica-
tion of Theodore Levitt’s article entitled ‘Mar-
keting myopia’ in the July–August 1960 issue
of the Harvard Business Review.