Marketing Myopia

What is Marketing Myopia? Myopia literally means short-sightedness. Marketing Myopia is the inefficiency of the Top Management to broadly define its business and meet customer needs resulting to the decline of the product.

Examples from the real world Daewoo Motors Hindustan Motors Kinetic Honda Pager Industry

Factors responsible for Marketing Myopia- by Theodore Levitt The belief of the companies that as more and more of the population becomes affluent, the market expands and more and more people buy the goods. The belief that there are no substitutes for the industry’s major products. Emphasis on mass production and in economies of scale i.e. being product oriented rather then being customer oriented. Lack of experimentation, improvement, and manufacturing cost reduction.

CASE: Ambassador Struggle for Survival

OVERVIEW HM an Indian automobile manufacturer is a part of Birla group of Industries. The company was the largest car manufacturer in India before the rise of Maruti Udyog Ltd. (MUL) Ambassador launched in 1958 was known as the first Indian car, owes its design and technology to British car model Morris Oxford built by Morris Motor Co at Oxford, U.K. Ambassador quickly occupied and ruled Indian markets from 1958-1980.

Ambassador- SUCCESS STORY Ambassador was widely used as a taxicab and as a government limousine. It was the only car with Diesel option. A sturdy car, ideal for Indian markets. Perception of being less expensive to maintain. Large Spaced. Over 16% of brand sales came from the Indian Government.

Reasons for the Brand Failure HM never knew where they fit in the existing economy. Ambassador never changed with times. It focussed on only one segment till 1997 and within that time MUL was able to bring out brands for each segment within the nation. HM did try to make some changes and upgrades but overall the look and built-in quality remained the same. Ambassador sales dipped badly in the year 2000 but HM never bothered to rationalize the price of the brand. Even today it costs over Rs. 400000

Contd. Indica took away the taxi car market and the customers got a new option for diesel car with modern technology. Immense competition from other major dealers like MUL, Hyundai etc.. In the year 2002, Mr. Atal Bihari Vajpai replaced Ambassador with a BMW Limo, from then on it lost the position of being the first politicians’ choice. The car lacked the quality and refinement. Rattling sound and rustling were some of the common complaints.

Possible Learnings A brand exists in the market till it becomes dated, after that it is virtually impossible to rejuvenate the brand. Brand must go to the customers for new ideas. Rationalize the price in the light of emerging market. Changes in product along with the change in market can sustain the brand even in emerging market. Best example is MARUTI 800, the brand is still surviving because it made changes along with changing consumer values and demands.