Organization is defined as a group
of people working together to achieve common goals and objectives of the business. Marketing
organization provides a vehicle for making decisions on products, marketing
channels , physical distributions, promotions and prices.
Marketing Organization: Marketing
organization is the framework for planning and making marketing decision that
are essential to marketing success. It is the vehicle for making decision on
all marketing areas such as product, price, place and promotion. Marketing
organization is a group of marketing persons working together towards the
attainment of certain common objectives. Marketing organization provides a
system of relationships among various marketing functions to be performed by
coordinating among marketing people.
Need for the organization:
to be competitive in the market where consumer is the king we need to satisfy
the consumer. So a good marketing organization is required to satisfy the
customers. Marketing organization is the pillar for success for many
organizations and provides a framework for the following:
a.
Divide and fix authority among the
sub ordinates
b. TO locate responsibility
c.
To establish sales routines
d. To enforce proper supervision of sales force
e.
To avoid repetitive duties
f.
To enable the top executives to
devote more time for planning policy matters
FACTORS
AFFECTING MARKETING ORGANIZATION
Factors influencing marketing org
can be categorized into internal and external factors .
Internal:
1. Top Management Philosophy: Organizational planning and its working is greatly
influenced by philosophy which can be good or bad eg: Centralization Vs
Decentralization
2. Product policy:
the width of product line of an org determines its size as the product
offerings becomes increasingly diverse. Eg: There could be a need to move away
from straight functional approach to product group approach.
3. People:
The size of the organization is not an important factor in terms of number of
people but it is important with respect to human values which are critical and
correct decisions regarding people cannot be made unless taking into
consideration
· Number
· Qualifications
· Capabilities
· Personality
· Attitude
· Fear
· Suspicion
· Ambition
Are some of the above intangible
factors which affect the marketing organization?
External
Factors:
1.
Business Environment: With regards
to business environment three points are important.
a.
The type of environment in which the
firm is operating in terms of operations and size.
b.
The Nature of particular requirement
for success in a given business which again determines the size.
c.
The rate of change in industries
being served which again decides on its size and working.
2.
Markets: This is the factor which
again affects the marketing organization i.e. one should note about its
a.
Size
b.
Scope
c.
Nature
d.
Location
Based on the above aspects we need
to design the size of the organization.
3. Consumer requirements and expectations: Consumers have their
own set of requirements and expectations from the organization. The more varied
and vivid services they expect that the usual requirements. as a marketer we
need to increase the workload depending upon the consumer requirements and expectations
4. Channels of distribution: It is the type of channel of
distribution which a marketing firm selects based on its size. Egg : Incase the
company opts for indirect channel or channels it depends on outside sales force
and hence the organization gets thinner .When the organization selects direct
channel its size is increased as it has its own sales force.
TYPES
OF MARKETING ORGANIZATION STRUCTURES
Types of marketing organization
structures: The marketing organization of a business can be structured on any
of the following basis:
a.
Line and staff organization
b.
Functional Organization
c.
Product oriented marketing
organization
d.
Customer oriented marketing
organization
e.
Geography oriented marketing
organization
f. Matrix form / Combined base
1. Line and Staff Organization: In most business forms
especially medium size the marketing job is structured around few line
functions and few staff functions i.e. Major staff functions is organized into
separate department and the line function is responsible for sales department.
The required coordination between the line and staff function is managed by the
executive at higher level.
Merits:
1. Provides expert advice from specialists
2. Relives line executes of routine, specialize functions
3. Enables young sales executive to acquire expertise
4. Helps in achieving effective coordination
5. Easy to operate
6. Less Expensive
Demerits:
1.
Produce confusions arriving from
indeterminate authority relationships
2.
Curbs the authority of experts
3.
Too much is expected from executives
4. Decision making is taken by top management
2.
Functional: Under the organization the
departments are created on the basis of specified functions to be performed
i.e. The Activities related to marketing, distribution etc
Merits:
1. Division of work base on specialization
2. Relives line executives of routine and specialized
functions
3. Promotes application of expert knowledge
4. Helps to increase overall efficiency
Demerits:
1.
Leads to complex relationships
2.
Makes coordination ineffective
3.
Promotes centralization
4.
Lack of proper coordination
5. Delay in taking decisions
3. Product Oriented
Marketing Organization: Organizations that produce wide variety of products
often organize marketing, training and promotion with respect to a product.
Merits:
1.
The salesmen can render better
customer service as they possess good knowledge of product and may have close
contacts with customers.
2.
It makes individual departments
responsible for the promotion of specific products.
3. It facilitates effective coordination
Demerits:
1.
It increases the employment of a
number of managerial personal
2.
Many salesmen of same enterprise
attend same customer each representing a separate product which creates
confusion in the minds of the customer.
3. There may be duplication of activities
4. Customer Oriented Marketing Organization: When the departmentation
of sales organization is done on customer basis it is called customer oriented
marketing organization. Deparmtnetation by customer may be done in enterprise
engaged in providing specialized services to different classes of customers.
Merits:
1.
It takes into account needs of each
class of customers.
2. IT provides specialization among the enterprise staff
Demerits:
1.
It makes coordination difficult
2.
It may lead to under utilization of
resources in same department
3.
There may be duplication of
activities
4. These types of sales organizations are not suitable for
small enterprises.
5. Geography/Territory:
In a territory oriented marketing organization , the responsibilities for marketing of various products rests
almost entirely with line executives .The territory managers are given varying
nomenclatures like depot manager, district manager, area manager, zonal manager
, divisional manager etc.
Merits:
1.
It leads to economy in terms of
times and money
2.
It helps in taking knowledge of
local customers
3. It helps in effective control
Demerits:
1.
It requires employment of number of
managerial personnel.
2. It dilutes control from head quarters
Marketing
Control:
Marketing control is concerned with
analyzing the performance of marketing decision, identifying the
problem/opportunities and taking actions to take advantage of opportunities and
resolving problems. It is the sequel to marketing planning. All manager need to
exercise control over their decision and marketing operations.
Specifically
marketing performance is measured in terms of market share, sales, profits.
Hence most control measures are designed with these parameters in mind. But
today's marketing needs to measure the following.
a) Market share
b) Sales and profits
c) Marketing effectiveness
d) Customer satisfaction
e) Customer perception of the firms and its brands
There are four types of controls
with different objectives and tools and exist with different levels of
management.
1) Annual plan control:
It is with top or middle level mgmt to evaluate actual performance with
targeted to analyze differences or gaps. The tools used are sales analysis,
market share analysis, sales and expense ratios, and financial analysis.
2) Profitability control: It is used by marketing department to
examine profitability by product, territory, customer segment and trade channel.
3) Efficiency control: It is used to asses the effectiveness of
money spend on sales force, advertising, sales promotion and distribution. It
is used by both line and staff executives.
4) Strategic control: It is used by the top mgmt to examine
wether the firm and marketing capable to cope with environment or not. The
major tool used here is marketing audit.
Marketing Control Process:
Marketing Control Process includes
monitoring, evaluating and improving the performance in each activity. There
are six steps in this
a) Decide the
aspect of marketing operation to be evaluated:
The first step in mcp is deciding
about the marketing operation to evaluate.
Eg: effectiveness of media for product advertisement, sales
person performance, or performance of company product
b) Establish
measurement criterion
In this stage performance standards
are decided against which actual performance is evaluated.
Eg: control sales person
performance, in this one can measure new accounts obtained, call frequency
ratio and order per call
c) Establishing
monitoring mechanism
After setting the standards, the next step is to develop
monitoring mechanism tools like marketing information system(MIS). MIS is used
to record performance of all marketing areas like monthly sales volume for
products.
d) Compare
actual results with standards of performance
In this stage, results obtained through monitoring process
are compared with pre established standards of performance.
e) Analyze
performance improvement
If the results/performance are not up to the desired
standards, a corrective action is to be taken to enhance the performance
levels. For this performance improvement analysis is to be done.
Marketing Audit:
Definition: Marketing audit is systematic review and appraisal of the
basic objectives and policies of marketing function and of the marketing
organization methods, procedures and personal employed to implement those
policies and to achieve those goals. Marketing audit is one of the important
tool to asses the effectiveness of different marketing mix elements.
Types
of Marketing Audit:
Marketing Environment Audit: It is divided into two groups i.e
macro environment and task environment. Macro environment audit includes
analysis of political, economical, technological and cultural aspects. Task
environment audit covers customers, competitors, markets, dealer/distributors,
suppliers, marketing firms and public.
Marketing Strategy Audit: This audit
reviews firms marketing mission, objectives, goals, and strategies and to
appraise their adaptability to present and future environment.
Marketing Organization Audit: The
audit evaluates the firms capability in implementing necessary strategies for
the future environment. It also reviews formal organization structure and
efficiency.
Marketing Systems Audit: It
evaluates the subsystems of a system such as marketing information system,
marketing planning system, marketing control system and new product development
system.
Marketing productivity Audit: This
audit critically examines the profitability of different marketing entities and
cost effectiveness of different heads of marketing expenditure.
