Theodore (Ted) Levitt (1925-2006)
American Harvard Business School professor (pictured right), world authority on marketing and creator of the
Key books and
Marketing Myopia (1960 Harvard Business
Don’t define your business too narrowly, because this will give a better idea of any potential diversification
opportunities and who your competitors are.
• a railroad company is in the transport, not the railroad, business.
• an oil company is in energy not oil.
• Hollywood is in entertainment not movies (this realization would
have turned the threat of television into an opportunity).
An organization and any of its activities (like production, R&D and selling) must aim to satisfy and
create customers (the true purpose of marketing).
Key quotes on customer
The organization must learn to think of itself not as producing goods and services but as buying customers, as
doing the things that will make people want to do business with it.
The entire corporation must be viewed as a customer-creating and customer-satisfying organism.
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Selling... is not marketing.
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A leader has to have a vision of grandeur, a vision that can produce eager followers in vast numbers. In
business, the followers are the customers.
Unless a leader knows where he is going, any road will take him there (on effectively communicating a purpose
that drives the whole organization).
Innovation in Marketing
To be successful an organization must put customers, not products, first.
This philosophy is at the heart of marketing, management and strategy, and the whole organization must be
totally committed to it.
This marketing philosophy requires:
1. Customer driven objectives
An organization must:
- aim “to get and keep customers”.
- be clear about what business it’s in (see Marketing Myopia above).
- implement “centripetal marketing” (where every organizational activity is customer
2. Customer driven leaders, managers and employees
An organization’s strategy must adapt to changing customer needs (for example, speed of service and
4. Product differentiation
A product should be seen as a bundle of tangible and intangible customer benefits (or
“value satisfactions”) which are superior and entirely different from those of competitors.
5. Creating the future through creativity and innovation
Creating new customers with new products through customer focused research and development (“marketing
Key quotes on organizational objectives
The primary business of every business is to stay in business.
Key quotes on marketing and customer satisfaction
Companies lyrically proclaim their marketing orientation, but for most of them it exists only on the verbal
Marketing is where the customer is, and it is the customer who in the end decides the fate of a business.
The Marketing Imagination
(see for more detail The Marketing
Imagination in the Business Books section).
A successful organization provides solutions to customers’ problems better than anybody
Strategy, employees and activities must be driven by customers’ needs and rising
expectations, because without them an organization will cease to exist.
Successful long-term relationships must be developed with customers through:
Using imagination and creativity to find new customer solutions.
2. Providing customer benefits
- tangible (e.g. the actual product).
- intangible (e.g. service and brand image).
The most important thing to remember about intangibles is that “the customer usually doesn’t know
what he’s getting until he doesn’t”.
3. The total product concept
This divides a product into four parts:
- Generic product - the basic product e.g. steel for a steel producer.
- Expected product - the customer’s “minimal
expectations” (including the generic product).
- Augmented product - giving a customer “what he
thinks he needs or has become accustomed to expect”.
- Potential product - possible ways of attracting
and keeping customers.
Key quote on products
People don’t buy things but buy solutions to problems.
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The sale merely consummates the courtship. Then the marriage begins. How good the marriage is depends on how
well the relationship is managed by the seller.
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Nothing drives progress like the imagination.
Key quotes on organizational
The purpose of a business is to create and keep a customer.
Good work in pursuit of wrong purposes is more damaging than bad work in pursuit of right purposes.
The Globalization of Markets (1983 Harvard
Business Review article)
The needs and behaviour of customers worldwide are becoming similar due to:
- global economies which lower prices.
This customer similarity is leading to
- the “globalization of markets” (the same product being sold worldwide).
- global competition between global companies.
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The global corporation... sells the same thing in the same way everywhere.
All I’m trying to do is stress the need for companies to examine the similarities between consumer preferences
as well as the differences which still persist (Levitt’s post-article comment warning of over-exaggerating global