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n 1960, Theodore Levitt in his classic article in the Harvard Business Review, Marketing Myopia, warned businesses that they should not define their business too narrowly, merely on the basis of the product they produced or the service they provided.

Levitt argues that a company’s business should be defined by consumers’ needs.

To support this argument, Levitt uses the railway industry in the US as an example.

This industry experienced a slow down due to defining its business as a railway company (product-orientation).

Levitt argues that if the railway companies saw themselves as transportation companies (consumer-orientation) they would be able to adapt to new technologies (automotive and airplanes) that served the same needs.

Even though Levitt’s concept of marketing myopia explains how companies can grow in a competitive environment, the concept can also be used to define where the competition is coming from.

By focusing on consumers’ needs, a company will come to know from where the competition can come from. Different products satisfying the same need are of course in competition with each other.

Competition would not be limited to the same product category. Similar to Levitt’s example of the
railway companies facing competition from automotive vehicles and airline services as they all satisfy the same consumer need; many industries are facing challenges from various industries that are serving the same needs.

As an illustration, for more than two decades, the Aqua brand has been the leading bottled drinking water brand in Indonesia. This brand name is so strong that to a certain extent it is synonymous with bottled drinking water.

Numerous brands have tried to challenge Aqua’s market leader position, but up until now it is still the market leader in the Indonesian bottled drinking water market.

In the last few months, however, a new water purifier product named Pureit was introduced to the Indonesian market.

This water purifier product represents a low cost solution to drinking water, as it does not require electricity or fuel.

In other words, one just has to pour water into this water purifier and clean drinkable water will be ready to be consumed.

This water purifier product that was first introduced in India and Bangladesh, is manufactured by Unilever, the largest consumer product company in Indonesia.

Based on the same need served by the two different product categories above, it can be said that Pureit is a competitor to Aqua.

Whether Pureit will be successful or not in challenging Aqua is still a question.

However, the fact that the two different product categories are in competition with each other is not in question.

Since the introduction of Pureit, the Aqua brand has been strengthening its positioning as high quality bottled drinking water by stressing the importance of its source of water, namely from pure and healthy springs in the mountains.

Pureit water purifier, on the other hand, is stressing the easiness of usage and low cost of providing drinking water. Competition between the two brands is definite.

Both brands are providing different reasons for purchase (differentiation) for the same need; consumers’ need of clean, healthy and affordable drinking water.

The above illustration is again similar to Levitt’s comparison of the railway service with the automotive vehicles and airline services.

Business history shows many instances where companies that were not able to define their businesses according to customer needs paid a high price for this failure.

A number of examples are: the minicomputers decline due to personal computers, the postal (mail service) companies that are facing challenges from Internet providers (emails or social media sites), the encyclopedia companies decline due to the Internet, the photography film companies losing to digital photography companies; this list is still very long.

Interestingly, the examples above also show that the importance of technology in changing consumer perception on how needs can be satisfied.

So important is technology, most marketing textbooks stress the importance of this factor as one of the macro-environment forces that can change the fate of a company’s offer to the market.

As long as technology can provide consumers with better products that serve their needs, consumers will happily move to these new products.

In conclusion, technological development, especially in relation to a similar need a company’s current product is serving, is really a factor that every company has to carefully watch if they do no want to fall into the marketing myopia trap.