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Changing Values and Characteristics 251

at all to conclude, “ … and therefore the customer has to pay the lump
sum of Y dollars in cash for each piece of product A he buys.” Rather,
the argument should go as follows: “What the customer pays for each
piece of the product has to work out as Y dollars for us. But how the
customer pays depends on what makes the most sense to him. It
depends on what the product does for the customer. It depends on what
fits his reality. It depends on what the customer sees as ‘value.’”
Price in itself is not “pricing,” and it is not “value.” It was this
insight that gave King Gillette a virtual monopoly on the shaving
market for almost forty years; it also enabled the tiny Haloid
Company to become the multibillion-dollar Xerox Company in ten
years, and it gave General Electric world leadership in steam turbines.
In every single case, these companies became exceedingly profitable.
But they earned their profitability. They were paid for giving their
customers satisfaction, for giving their customers what the customers
wanted to buy, in other words, for giving their customers their
money’s worth.
“But this is nothing but elementary marketing,” most readers will
protest, and they are right. It is nothing but elementary marketing. To
start out with the customer’s utility, with what the customer buys,
with what the realities of the customer are and what the customer’s
values are—this is what marketing is all about. But why, after forty
years of preaching Marketing, teaching Marketing, professing
Marketing, so few suppliers are willing to follow, I cannot explain.
The fact remains that so far, anyone who is willing to use marketing
as the basis for strategy is likely to acquire leadership in an industry
or a market fast and almost without risk.

Entrepreneurial strategies are as important as purposeful innova-
tion and entrepreneurial management. Together, the three make up
innovation and entrepreneurship.
The available strategies are reasonably clear, and there are only a
few of them. But it is far less easy to be specific about entrepreneurial
strategies than it is about purposeful innovation and entrepreneurial
management. We know what the areas are in which innovative oppor-
tunities are to be found and how they are to be analyzed. There are cor-
rect policies and practices and wrong policies and practices to make an
existing business or public-service institution capable of entrepreneur-
ship; right things to do and wrong things to do in a new venture. But
the entrepreneurial strategy that fits a certain innovation is a high-