Managing a Holistic

Marketing Organization for the Long Run

Part 2

What are the keys to internal effective marketing?

Traditionally marketers played the role of middlemen. That is they facilitated conversation between the firm and its customers.

Now, each functional area of the firm interacts with the buyers directly. Marketers are now required to integrate all the customer facing processes so that customers see and hear a single voice when interacting with the firm.

Internal marketing Requires everyone in the organization to accept the concepts and goals of marketing and place the customers at the centre. This requires co-ordination between the units of a firm.

The organization of the marketing department is an important aspect. There are a number of ways of organizing.

Functional Organization

Advantages and Disadvantages

Administrative simplicity Difficulty in coordination

Geographic organization Applicable for companies selling in national and international markets

Product or Brand Management Organization

Can be found in firms specializing in products which are quite different from

each other.

Note: This does not replace functional

organization but serves as an additional layer of

management

Different systems under this

organization

Hub and Spoke System

Advantages and Disadvantages

Focus on building market share rather than

customer relationships

Fragmentation makes it harder to build a national

strategy

System is costly

Give the firm’s smaller brands a product advocate

React more quickly to new products in the market place

Let s the product manager develop cost effective marketing programme

Brand managers manage a brand only for a short time. Short term planning

fails to build long term strengths

Managers may lack the authority to carry out

responsibilities

They become experts in their product area but rarely achieve

functional expertise

Product teams: Three types Vertical Triangular Horizontal

Product Manager

R C F D S E

M= Market researcher C= Communication specialist S= Sales Manager D= Distribution specialist F= Finance specialist E= Engineer

Product Manager

M C

M= Market researcher C= Communication specialist

Category Management

Focuses on product categories to manage its

brands

Adopted by Proctor and Gamble

Advantages cited by P&G

Ensure adequate resources for all categories Retail trade success after thinking of profitability in terms of product categories. So, P&G thought it would make sense to follow their path.

Market Management Organization Desirable when customers fall into different user groups with distinct buying preferences. Long range plans and profitability drawn for each individual customer group (Market).

Matrix Management Organization

Desirable when firms produce many products for many markets. Employs both product and market managers

Relationships with other departments

Departments define company goals from their view points. This often leads to conflicts. Co ordination required. Often facilitated through the CMO or Vice-president.

Many firms now focus on key processes rather than departments

to ensure smooth functioning.

To be a true market driven company

Focus on

Customers Customers Customers!

Being customer driven is necessary But not enough.

A firm must also be creative to be successful.

Recap

Internal Marketing

Organizing the Marketing department (Functional, Geographic, Brand based,

Market based, Matrix)

Relationships with other departments

Thank you!