Page 41 - HBR's 10 Must Reads on Strategic Marketing

LEVITT
Idea in Brief

What business are you really in? A instead of serving customers. Too
seemingly obvious question—but many other industries make the
one we should all ask before de- same mistake—putting themselves
mand for our companies’ products at risk of obsolescence.
or services dwindles.
How to ensure continued growth
The railroads failed to ask this for your company? Concentrate on
same question—and stopped meeting customers’ needs rather
growing. Why? Not because peo- than selling products. Chemical
ple no longer needed transporta- powerhouse DuPont kept a close
tion. And not because other eye on its customers’ most press-
innovations (cars, airplanes) filled ing concerns—and deployed its
transportation needs. Rather, rail- technical know-how to create an
roads stopped growing because ever-expanding array of products
railroads didn’t move to fill those that appealed to customers and
needs. Their executives incorrectly continuously enlarged its market.
thought that they were in the rail- If DuPont had merely found more
road business, not the transporta- uses for its flagship invention,
tion business. They viewed nylon, it might not be around
themselves as providing a product today.

opportunities to apply their technical know-how to the creation of
customer-satisfying uses that accounts for their prodigious output
of successful new products. Without a very sophisticated eye on
the customer, most of their new products might have been wrong,
their sales methods useless.
Aluminum has also continued to be a growth industry, thanks to
the efforts of two wartime-created companies that deliberately set
about inventing new customer-satisfying uses. Without Kaiser Alu-
minum & Chemical Corporation and Reynolds Metals Company, the
total demand for aluminum today would be vastly less.

Error of analysis
Some may argue that it is foolish to set the railroads off against alu-
minum or the movies off against glass. Are not aluminum and glass
naturally so versatile that the industries are bound to have more
growth opportunities than the railroads and the movies? This view
commits precisely the error I have been talking about. It defines an

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