The Bluelist 📘 Ted Levitt: Marketing Myopia & Innovative Imitation
"All in all, ideation is relatively abundant. It is its implementation that is more scarce." Theodore Levitt (1925 - 2006)
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Introducing The Bluelist 📘
Step into a world of innovation with The Bluelist! As someone who values bringing academic insights to industry, I'm excited to introduce a new format of my newsletter, where we'll explore the stories of 500 pioneers who have ventured into the wide blue yonder of entrepreneurship and innovation. A weekly dose of fresh ideas in our ‘Weekly Science Selections 📚’ and a long-read from ‘The Bluelist 📘’, right into your inbox. Subscribe now for your MBA in innovation! ✨.
Weekly Science Selections 📚
Every week, this section contains newly published scientific articles in the field of innovation & entrepreneurship. This section contains the #EditorsChoice and a list of articles grouped into #MustReads, #ShouldReads and #CouldReads.
#EditorsChoice: Future applications of generative large language models: A data-driven case study on ChatGPT (Filippo et al., 2024): this research paper analyzed 3,8 million tweets on future application areas of large language models such as ChatGPT. The analysis highlighted six emerging areas of application for ChatGPT: human resources, programming, social media, office automation, search engines, education. The study also examines the implications of these findings for innovation management, proposing a research agenda to explore the intersection of the identified areas, with four stages of the innovation process: idea generation, screening/idea selection, development, and diffusion/sales/marketing. Please find a snapshot of the table that includes future directions below:
Beyond this point lies exclusive content for our premium subscribers. Continue reading the full list of our 'Weekly Science Selections 📚' and uncover The Bluelist 📘 with the captivating story of Ted Levitt, exploring his groundbreaking ideas on Marketing Myopia, Innovative Imitation, and Globalization.
#MustRead: The interplay between product development failures and alliance portfolio properties in the formation of exploration versus exploitation alliances (Bae & Ozmel, 2024): if a company has low technological diversity in their current collaborations, then experiencing failures will negatively impact engaging in new, exploratory collaborations. This has been investigated using examples from the biopharmaceutical industry, and the results support these findings.
#ShouldRead: Intrapreneurial ecosystems in academia and their overlooked outputs: Graduate employability and wellbeing (Abreu & Grinevich, 2024): The findings highlight academia's growing emphasis on improving graduate outcomes beyond traditional metrics, underscoring the importance of university national stakeholder networks and the practical value of the intrapreneurial ecosystem concept for guiding university management and practitioners in addressing immediate, medium-, and long-term challenges.
#CouldRead: Entrepreneurship: Moving away from work–life balance and toward work–life harmony (Murphy & Manocha, 2024): As the focus shifts from traditional to entrepreneurial ways of doing things, society is changing to support more innovative ventures. This includes changes in policies and attitudes, with governments offering incentives for starting new businesses. Schools are also teaching entrepreneurship more than ever before, making it a popular career choice. This shift suggests that future entrepreneurs will prioritize finding balance between work and personal life, leading to a more harmonious approach to their careers.
Ted Levitt: Marketing Myopia and Innovative Imitation
In the corridors of the world’s most renowned academic institutes, the brightest minds in the field of innovation and entrepreneurship read, discuss, teach and write about what are just ideas in the early stages, but end up being highly influential concepts used professionals around the world. One of them was Theodore (Ted) Levitt, a German-born American academic, whose ideas on marketing and globalization have shaped businesses for more than 50 years. After attaining his PhD in 1951, Levitt wrote his first article for Harvard Business Review in 1956. In 1960 he wrote his important piece on Marketing Myopia, which has grown into one of HBR’s most reprinted articles of all time. His views on marketing, creativity, differentiation and globalization have had a wide impact. His key question: “What business are you in?” is still one of the most prevalent - and most difficult to answer - questions for organizations in 2024.
Early Life
Born in the Mittlegebirge in the Bundesland of Hessen, close to the city of Frankfurt, Levitt moved with his family to Ohio to escape the threat of a changing regime. Although he and his three siblings had a hard time getting used to living in the USA - “We lived in a rough, colorful neighborhood. It was a strange, alien world. As kids, we were independent and streetwise, except our parents paid considerable attention to what we did in school,” he said to the Dayton Daily News. Together with Erma Bombeck, who became a well-known columnist, he initiated a newspaper in their local school. After having served in Europe during WWII, he went to college and received his PhD in economics from Ohio State University in 1951. His first job was a lecturing job at the University of North Dakota and in 1956 he wrote his first article for HBR, named ‘The Changing Character of Capitalism’, which got him attention from both the academic world and businesses. A few years after, he was recruited to join Harvard Business School.
Key Ideas
In 1960, he wrote his most famous article, ‘Marketing Myopia’, which discusses the fact that companies are often shortsighted, meaning that they narrow their perspective on marketing to selling existing products rather than understanding the needs of their target market. The phrase ‘selling the hole, not the drill’ because widely quoted (Domingo Media, 2023). The article laid common ground for a shift in marketing theory from a focus on creating products and services to offering value - something that has only become widely accepted in the 21st century. He stated himself that the article shifted the perspective of marketing as being ‘the stepchild’ of the organization to the being at the heart of strategy: “‘Before Levitt,’ one admirer said, ‘marketing was a poor relation in the world of senior management.’ After Levitt, that was no longer the case.” (Harvard Gazette, 2006)
In 1962, he wrote “Innovation in Marketing”, in 1963 he wrote “Creativity is not Enough”, and in 1966 he wrote “Innovative Imitation”, for which he was sometimes named ‘the high priest of innovation’. These works shaped his ideas on both standardization and differentiation in the world of innovation. He argued that “all in all, ideation is relatively abundant. It is its implementation that is more scarce.” (1963). He discussed that it’s not creativity that generates innovation, but actions - and that too much creativity in fact can kill organizations. He started to argue that innovation requires standardization on the one hand: “No organization can have everybody running off uncoordinated in several different directions at once. There must be rules and standards,” and differentiation on the other hand: “Beyond these, the problems and needs of companies differ. To this extent, they may have to find their own special ways of dealing with the issues discussed in this article. The important point is to be conscious of the possible need or value of some system of making creativity yield more innovation.” That is also why he embraced a form of ‘innovative imitation’: “Each solitary innovator sparks a wave of eager imitators. […] The newness of which consumers become aware is generally imitative and tardy newness, not innovative and timely newness.”. He as such argued that innovation comprises of 2 things: “(1) newness in the sense that something has never been done before, and (2) newness in that it has not been done before by the industry or by the company now doing it.”
In 1983 he published two existential works: “The Globalization of Markets” and the “Marketing Imagination”. In the globalization of markets, he argued that globalized companies - focusing on a highly differentiated, specialized offering which is similar for all countries worldwide - will outperform the multinational companies - focusing on creating customized products in each country in which they are active. He argued that they will outperform because they can offer more value and be more innovative on the one hand (Marketing Success through Differentiation, 1980), and can be low-cost, high-quality at the other hand. Later, he stated that his work was ‘provocative’, which is one of the reasons that there is still ongoing (academic) debate about his perspective on globalization. For instance, this article by Abdelal & Tedlow (2003) sums up some of the most critical acclaims to his theory (in hindsight).
Impact
Levitt's emphasis on customer-centricity and value creation continues to shape modern marketing strategies, with organizations increasingly focusing on understanding and meeting the evolving needs of their target markets.
His insights on innovation, including the balance between standardization and differentiation, as well as the concept of "innovative imitation," remain relevant in today's business landscape, guiding organizations in effectively implementing creative ideas and staying competitive in the market.
Key take-aways
Prevent Marketing Myopia: understanding and fulfilling the needs of your target market is essential for sustainable success. Focus on offering value rather than just selling products or services.
Strike a balance between standardization and differentiation: while standardization provides consistency and efficiency, differentiation allows for innovation and adaptation to unique market demands. Find the right blend to stay competitive.
Recognize the power of action in innovation: creativity alone is not enough to drive innovation. It's the implementation of ideas that truly brings change. Encourage a culture of experimentation and proactive execution in your own way of working and within your organization.