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BEST OF HBR 1960 Sustained growth depends on how broadly you define your business—and how carefully you gauge your customers’ needs.

Marketing Myopia
by Theodore Levitt
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Reprint R0407L

Sustained growth depends on how broadly you define your business— and how carefully you gauge your customers’ needs.

BEST OF HBR 1960

Marketing Myopia
by Theodore LevittCOPYRIGHT © 2004 HARVARD BUSINESS SCHOOL PUBLISHING CORPORATION. ALL RIGHTS RESERVED.

We always know when an HBR article hits the big time. Journalists write about it, pundits talk about it, executives route copies of it around the organization, and its vocabulary becomes familiar to managers everywhere—sometimes to the point where they don’t even associate the words with the original article. Mostimportant, of course, managers change how they do business because the ideas in the piece helped them see issues in a new light. “Marketing Myopia” is the quintessential big hit HBR piece. In it, Theodore Levitt, who was then a lecturer in business administration at the Harvard Business School, introduced the famous question, “What business are you really in?” and with it the claim that, hadrailroad executives seen themselves as being in the transportation business rather than the railroad business, they would have continued to grow. The article is as much about strategy as it is about marketing, but it also introduced the most influential marketing idea of the past half-century: that businesses will do better in the end if they concentrate on meeting customers’ needs rather than on sellingprod-

ucts. “Marketing Myopia” won the McKinsey Award in 1960.

Every major industry was once a growth industry. But some that are now riding a wave of growth enthusiasm are very much in the shadow of decline. Others that are thought of as seasoned growth industries have actually stopped growing. In every case, the reason growth is threatened, slowed, or stopped is not because the market issaturated. It is because there has been a failure of management.

Fateful Purposes
The failure is at the top. The executives responsible for it, in the last analysis, are those who deal with broad aims and policies. Thus: • The railroads did not stop growing because the need for passenger and freight transportation declined. That grew. The railroads are in trouble today not because that needwas filled by others (cars, trucks, airplanes, and even telephones) but because it was not filled by the railroads themselves. They let others take custom-

harvard business review • top-line growth • july–august 2004

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Marketing Myopia •• •B EST OF HBR 1960

Theodore Levitt, a longtime professor of marketing at Harvard Business School in Boston, is now professor emeritus. His mostrecent books are Thinking About Management (1990) and The Marketing Imagination (1983), both from Free Press.

ers away from them because they assumed themselves to be in the railroad business rather than in the transportation business. The reason they defined their industry incorrectly was that they were railroad oriented instead of transportation oriented; they were product oriented instead ofcustomer oriented. • Hollywood barely escaped being totally ravished by television. Actually, all the established film companies went through drastic reorganizations. Some simply disappeared. All of them got into trouble not because of TV’s inroads but because of their own myopia. As with the railroads, Hollywood defined its business incorrectly. It thought it was in the movie business when it wasactually in the entertainment business. “Movies” implied a specific, limited product. This produced a fatuous contentment that from the beginning led producers to view TV as a threat. Hollywood scorned and rejected TV when it should have welcomed it as an opportunity—an opportunity to expand the entertainment business. Today, TV is a bigger business than the old narrowly defined movie business ever...