What business are you in? That is one of the most deceptively difficult questions you’ll face.
Here’s an example from my personal experience.
One of my first consulting customers was a regional telecom company. This was a company run by engineers who were proud of their ability to offer the very latest technology. But when I asked customers why they valued this company, they cared nothing for the technology. They valued reliability and the fact that this company would respond to issues even in the middle of the night.
My customer thought they were selling technology. However, the customer was buying a security blanket for their critical communication systems.
In the latest episode of The Marketing Companion, Keith Jennings and I explore the multidimensional question, “What business are you in?”
Theodore Levitt
We begin by discussing Theodore Levitt’s seminal article “Marketing Myopia,” published in the Harvard Business Review in 1960. One of the key questions Levitt posed in this article is, “What business are you in?” Levitt suggests that this question has profound implications for how companies understand their purpose, define their markets, and, ultimately, achieve long-term success.
Levitt argued that businesses often fail because they are too focused on their products rather than on their customers’ needs and desires. He used the term “marketing myopia” to describe this shortsightedness. Companies should not define themselves by the products they make but by the value they deliver to their customers. This shift in perspective can lead to a broader and more sustainable understanding of their market and competitive landscape.
Levitt’s question, “What business are you in?” forces companies to look beyond the immediate scope of their operations and products. It encourages them to think about the underlying needs they fulfill for their customers. This customer-centric approach is essential for innovation and growth. When businesses understand their core purpose, they are better equipped to adapt to changes in technology, consumer behavior, and market conditions.
A modern example of Levitt’s principle can be seen in companies like Apple. While Apple started as a computer manufacturer, it recognized early on that it was in the business of creating innovative technology solutions that enhance people’s lives. This broader vision has allowed Apple to expand into various markets, including music, smartphones, tablets, and wearables, continually redefining its business in response to technological advances and consumer demands.
The Marketing Companion episodes are short—30 minutes—but the conversation is expansive. Listen and learn how you might answer the question, “What business are you in?”
Click here to enjoy Marketing Companion episode 292
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Illustration courtesy MidJourney