MKT101 IB1203 hoangnse03997 individualassignment marketingmyopia

MINISTRY OF EDUCATION AND TRAINING VIET NAM PRINCIPLE OF MARKETING – MKT101 INDIVIDUAL ASSIGNMENT Full name: Roll number: Class: Class instructor: Nguyen Hoang SE03997 IB1203 Le Pham Khanh Hoa Hanoi, February 2018 Table of Contents Problem The Production concept and Marketing Myopia 2.1 Marketing management orientations 2.2 The Product concept example 2.3 Marketing Myopia Story of Yahoo! Conclusion 11 References 12 Problem Living in the very first of the 21st century, people might witness the collapse of many reputed companies, which were at peak of victory, in the past They was sometimes undeadable in our minds and used to lead the world with billions of employees, trillions of customers, renowned high brand… However, these achievements could not help those companies to continue withstanding in the harsh market It is extremely difficult to determine what caused failures because there were many reasons for brand failures There is a brand got a hard fall that it seemed to be unable to come back ever It is Yahoo! Analysts from many fields, at that time, assumed that Yahoo! had failed because of the stronger innovation of another technology companies as Facebook and Google Nevertheless, the truth is not as simple as what we saw Yahoo! had lost power itself by rolling in the internal crisis before the rivals grew and threatened its position In fact, the seeds of collapse appeared at the time that Yahoo! was enjoying success When deeply researching about Yahoo!’s development strategies and activities, we would be surprised that one of the main reasons for the failure of this brand is “Marketing Myopia” This assignment will not only show the definition of Marketing Myopia, but also help us to understand deeply what Marketing Myopia negatively affects finance and reputation of a company based on the real story of Yahoo!’s failure Experiences gained from this case are the good lessons for those who want to avoid dreadful mistakes in marketing The Production concept and Marketing Myopia 2.1 Marketing management orientations Every company selling products or services has to determine who their target customers are Then, the Marketing manager of each company has to design strategies to build profitable relationships with these customers However, sometimes what customers need conflict with the needs of society or even with the interests of company The questions raised here are what should lead the marketing strategies and what side the company should focus to satisfy its needs To answer the questions above, Marketing management orientation is defined Marketing management orientation is the way under which organizations design and carry out their marketing strategies (Kotler & Armstrong, 2011) In other words, Marketing management orientations are different marketing concepts to create, produce and market products to customers by concentrating on diverse techniques There are five basic concepts with short descriptions below This assignment only focuses on the Product concept to clarify definition of Marketing Myopia in the next parts The Production concept is one of the oldest Marketing management orientations In this concept, customers tend to choose low cost and widely available products and services Business of the company is making units as many Figure The Production concept as possible The Product concept guides company to focus on producing products with improvements and modern technologies because consumers want high quality, high performance things with innovative features Figure The Product concept The next two orientations are the Selling concept and the Marketing concept They are compared with each other in the figures below Figure The Selling concept In the Selling concept, there is an inside-out view that companies concentrate on existing products and heavy selling It is based on the belief that consumers buy products only if companies offer aggressive selling or promotional efforts Figure The Marketing concept The Marketing concept takes an outside-in view that a path to profits is concentrating on satisfying customer needs (Kimmel, 2012) The last orientation is the Societal marketing concept It maintains or improves consumers and society well-being to deliver value to customers Interests and the needs of the targeted consumer market are what the concept aims for Figure The Societal marketing concept 2.2 The Product concept example Studying about The Product concept, organizations should make effort to innovate technology and manufacture continuous product improvements A typical example of the company that follows this concept is Apple Figure iPhone generations Looking at the evolution of iPhone, we cannot deny what Apple has been doing for providing best products for their customers Nowadays, iPhone is always on top of the highest quality brands Whether people have money to buy an iPhone or not, they still pay attention to the product and wait for what newest technologies coming in the next generations If a brand is excellent enough to build a fandom, thing they care about is not who will buy, it is how to make better products to satisfy billions of customers However, the success of Apple in the Product concept is not always the good guideline for any companies Product quality, performance and features are important elements need to be consider carefully when making any marketing strategies, but overestimating only the important of products lead to the failure called Marketing Myopia 2.3 Marketing Myopia Marketing Myopia is the term firstly created by a famous American economist and professor - Theodore Levitt In the magazine Harvard Business Review published in 1960, he mentioned Marketing Myopia by the sentence “businesses will better in the end if they concentrate on meeting customers’ needs rather than on selling product” (Levitt, 1960) This term has a great value that it is chosen to be one of the first lessons for students studying Marketing all over the world Marketing Myopia implies the companies’ strategies, which are built by limited knowledge, narrow-minded view and subjective attitude During the process of marketing a brand, the marketing-myopia-marketers see the business at the time they are currently in but business in the future They invest money and time too much to make their products extremely outstanding Most of them get bitterness because they just care about goods and services without spending time to understand or find out the future wants and needs of their customers Companies which are trapped in Marketing Myopia often think that they control all the industry they are in, they look down on their customers and focus only on sales targets, revenues, profits and other benefits Resting on their laurels for a long time, these companies would surely be defeated at once by the competitors, even newbies, if they were not cautious Who ameliorate and satisfy customers’ needs faster will achieve the leader status in the market and destroy the brands that have existed there for a long time There is a crucial question that every company must ask themselves: What business are they doing indeed? Once the answer was figured out, it would be the primary key to keep any companies far from Marketing Myopia For instance, a transportation company that provides bus services for people from city A to city B, should ask itself what business they are really in If they just think they are in the bus business, they will fail soon because people may have a bunch of choices for transporting from city A to city B besides bus If they want to go faster, they will choose airplane; if they need a safer trip, train is a good choice; or they just care about minimizing budget, there is nothing better than motorbike Their purpose is to go to the destination, not going there by what On the contrary, if the company realizes that it is in transportation business, can also enter into Taxi service business, which helps the business to sustain for a longer period They will be more flexible and sensitive to the customers’ dramatically changing preferences in modern life Adding taxi service or another transportation is an idea helping their business to stand in the market for a long time, under increasing pressure of the rivals Story of Yahoo! Yahoo! was remembered as a symbol of internet communication business The company established in 1994 created the most famous chatting tool - Yahoo! Messenger at that time and governed this modern industry with many essential online products as Yahoo! Mail, Yahoo! 3600, and Yahoo! Answers… Figure Logo of Yahoo! Yahoo! Messenger used to be the best communication tool using Internet in the world It was so popular that when people meet each other, they asked for Yahoo ID instead of phone number With a computer connecting to the Internet, people can easily sign up and get a free account to join the online network At the beginning, Yahoo! invested on Yahoo! Messenger strongly Users felt amazing with extensions attached as sending emails via the main interface of the application, using emoji when chatting or playing small games with others It was this moment that Yahoo! forgot the growth of competitors outside Facebook appeared in 2004 opening the century of social network Joining Facebook, people not only share their thoughts, their pictures public, but also chat with other in private Moreover, they can receive reactions of the friends instantly in what they shared Apple released the first iPhone in 2007, showed the world that mobile phone now becomes smartphone and help people not have to sit down in front of cumbersome computers all the time Google does not own the large amount of accounts in their social community Google+ as Facebook, but it is the giant in searching (Google Search), video publishing (YouTube), data storage (Google Drive) and so on Both of them has been developing at high speed, so what Yahoo! did that time? Yahoo nonplussed found the way to fight against these serious competitors Unfortunately, they failed because they did not know what they really needed to People still need chatting, but less manipulation, more convenience, beautiful interface and multiworking environments They have smartphone and this is what Yahoo! approach too slow Until 2010, Yahoo! released the first Yahoo! Messenger mobile application with imperfect functions, bad UI and unstable core system (Luan, 2016) Figure Yahoo! Messenger's interface on smart phone E-mail is another tool that people use daily Yahoo! e-mail system has been highly preferred for a long time because of the connection with Yahoo! Messenger When the chatting tool started weakening, Yahoo! Mail was also disclosed some problems Interface has not been changed for more than ten years, lots of useless data was still loaded when sending an e-mail Additionally, Yahoo! Mail forced users to install a download tool, which they thought it was amazing, if users wanted to download attachments from e-mails they received Once again, Yahoo! went against people needs (Loan, 2010) Figure Yahoo! Mail interface in 2008 People also need an online home space to update what they are doing Yahoo! 3600 used to cover it all, but it was such an error that Yahoo! managers focused on colorful interfaces, complicated effects and out-of-date content formats (simple text and pictures) whereas Facebook started providing friendly simple interfaces, allowing users upload text, pictures, videos, files in many formats, opening a huge games and applications store Last but not least, Facebook encourages people to interact with each other through news feed and notifications system, through which people announce others their status and know what others are doing, too Satisfying people, this is what Facebook did, Yahoo! did not As a result, Yahoo! disappears from many fields on the Internet At the moment, people use Google Search instead of Yahoo! Search; Tumblr (a microblogging that Yahoo! bought 10 in 2013) cannot grow up to be a big social network as Facebook or Twitter; Yahoo! Mail lost its entire market share into Gmail According to the research of (Taylor, 2017), Yahoo!’s statistics are all smaller than Google Yahoo! cannot define what they really are and what their mission of the Internet is Yahoo! was defeated, it is the fact that we cannot refuse The reasons for this failure are listed above, through which we realize how Marketing Myopia damages a high brand Yahoo! still exists and continues providing online services for users; however, its position hardly comes back to the peak as it did Conclusion Pioneer of users is the company that knows how to heighten customers, not company’s products or services Technologies can change a product or a service but only the anticipation of customers’ needs has power to beautify brand image and strengthen belief of customers Marketing Myopia reminds us of the dangers companies may face Today you are success; it does not mean that tomorrow you will not plummet disappointments Customers’ needs change day by day so marketers should sit down and listen to what customers really want As Theodore Levitt used to say, “People not want to buy a quarter-inch drill They want to buy a quarter-inch hole!” In business, instead of selling what the company is producing, let’s sell what people need 11 References Kimmel, A., 2012 Psychological Foundations of Marketing s.l.:s.n Kotler, P & Armstrong, G., 2011 Principles of Marketing, Global Edition, Fourteenth Edition s.l.:s.n L D., 2016 Tinh Tế [Online] Available at: https://tinhte.vn/threads/vi-sao-yahoo-messenger-chet.2599970/ Levitt, T., 1960 Marketing Myopia Harvard Business Review L K., 2010 GenK [Online] Available at: http://genk.vn/mang-xa-hoi/phan-1b-yahoo-hien-tai-bet-bat20101002042257285.chn Taylor, M., 2017 VentureHarbour [Online] Available at: https://www.ventureharbour.com/visualising-size-google-bing-yahoo/ 12