Article Review of Marketing Myopia

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From asking trouble point, the writer said that petroleum industry only focused on improving the efficiency of getting or making their product rather than improving the generic product or their marketing. According to the writer, because of this situation, the petroleum industry is asking trouble from the outsider because later, the investor and entrepreneur will come and take control of the industries.

Next, idea of indispensability. The petroleum industry was very confident on their product because they think there is no competitor of their product. The problem is many refining companies has big amount of crude oil reserves. These oil only has value if it can be converted to a market needs. This idea persists despite all historic evidence against it. The evidence not only shows that oil has never been a superior product for any purpose for very long but also that the oil industry has never really been a growth industry.

After that, the perils of petroleum. According to the writer, the demand of oil has increased because of the needs of oil in kerosene lamps. Then, the disaster for the oil industry struck again because of two great innovations. The first innovation is the successful development of coal-burning domestic central-heating systems. The second innovation is internal combustion engine. The writer also said that the petroleum industry competes with natural gas. While the oil companies themselves owned the gas that now competed with their oil, the industry did not originate the natural gas revolution, nor has it to this day greatly profited from its gas ownership.

The last point of population myth is an uncertain future. According to the writer, oil has never been a continuously strong growth industry. It only grown by fits and starts, and this industry always only saved by innovations and developments not of its own making. The reason it has not grown in a smooth progression is that each time the oil industry thought it had a superior product safe from the possibility of competitive substitutes, the product turned out to be inferior and notoriously subject to obsolescence.

Moreover, the fourth point that the writer mention is production pressures. According to the writer, mass production industries are impelled by a great drive to produce all they can. There are four main point that writer has discussed on this fourth point. The points are a lag in Detroit, what Ford put first, product provincialism and creative destruction.

Firstly, a lag in Detroit. On this point, the writer discussed on the impact of mass production to the society. The auto companies annually spend millions of dollars on consumer research in Detroit. Because of that, the new compact cars are selling so well in their first year. The writer said this indicates that researcher in Detroit failed to identify the needs of the customer. This lead to a losses of millions of customers to other small-car manufacturers. The reason of this losses are the researcher in Detroit never really research what consumers’ wants.

Secondly, what Ford put first. From one of biggest automobiles company, Ford, the writer said that Ford was both the most brilliant and the most senseless marketer in American history. He was senseless because he refused to give the customer anything but a black car. He was brilliant because he fashioned a production system designed to fit market need. Ford is genius because of his marketing. He cut his selling price of car in order to attract more consumer. He makes a mass production which is the reason why he can sell his product at lower prices. His policy is to reduce the price, extend the operations, and improve the article. He never considered any costs as fixed. Therefore, he reduces the price to the point where he believes more sales will result. The low price makes everybody dig for profits.

Next, product provincialism. Provincialism is the state of having concern for purely local matters or having narrow outlook. For example, being concerned with only one’s town, as opposed to surrounding communities or other countries as well. From this point, the writer said that the usual result of this narrow pre-occupation with so-called concrete matters is that instead of growing, the industry is declines. Product provincialism happens when a company defines itself based on the product and not on the industry and when this happen, not enough amount of product can starve off its death sentence. If the company has defined themselves as being in the transportation industry rather than the buggy whip business, the company may have survived.

The last point of production pressures is creative destruction. According to the writer, he described a customer as someone who dislike bother, delay and experience of buying gasoline. But the consumer still buy gasoline in order to drive their cars. The gas station where the consumer need to buy gasoline from acted like a tax collector to whom people are compelled to pay a periodic toll as the price of using their cars. The companies that are working on exotic fuel substitutes will eliminate the need for frequent refuelling are heading directly into the outstretched arms of the irritated motorist. They are riding a wave of inevitability, not because they are creating something that is technologically superior or more sophisticated but because they are satisfying a powerful customer need.

Last but not least, the fifth point where the writer discussing about the danger of R&D. According to the writer, another danger to a firm that only started to grow is when the top management is wholly transfixed by the profit possibilities of technical research and development. The best examples of danger of R&D is a new industry of electronics and oil companies. The danger a new companies had to face is they pay too much attention on their research and development rather than their marketing. There are two main point of danger of R&D which are marketing shortchanged and stepchild treatment.

Marketing shortchanged is about of the greatest companies pay too much attention to R&D. The company are growing up under conditions that come dangerously close to creating the illusion that a superior product will sell itself. It is not surprising that, having created a successful company by making a superior product, management continues to be oriented toward the product rather than the people who consume it. There are two factor that strengthen and sustain this belief. Firstly, electronic products are highly complex and sophisticated, managements become top-heavy with engineers and scientists. This creates a selective bias in favor of research and production at the expense of marketing. The organization tends to view itself as making things rather than as satisfying customer