Transcript session 3 internal environment

BASICS OF MARKETING I
Session 3
Internal Environment
SBA SEMESTER ONE
Designed & developed by E4
Session 3
BASICS OF MARKETING- I
Learning Objectives
• To understand different ways in which a
marketing department in an organization is
structured.
• To understand advantages and disadvantages
of each.
• To understand relationship of marketing
department with other departments.
SBA SEMESTER ONE
Designed & developed by E4
Session 3
BASICS OF MARKETING- I
Marketing Organization
Marketing structure depends on the following:
• How best to satisfy customer needs
E.g. In-house service department
• The firm’s resources
E.g. Having a sales force or distributors sales force
or the fact the smaller marketing organizations
outsource marketing services like Market
Research, Advertising etc
SBA SEMESTER ONE
Designed & developed by E4
Session 3
BASICS OF MARKETING- I
Functionally Focused
Head of Co/Div
Mfg
Prod Mktg
SBA SEMESTER ONE
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Mktg
Sales
Advtg
Session 3
Finance
Mkt
Research
BASICS OF MARKETING- I
Functionally Focused
Strengths
• Marketing planning for the business centered in
one position
• Increases efficiencies and expertise in selected
marketing activities through specialization
• ‘Administrative simplicity’ puts specific people
and resources in place for key marketing
functions
SBA SEMESTER ONE
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Session 3
BASICS OF MARKETING- I
Functionally Focused
Vulnerabilities
• Tends to have a very high level of closure for
the development and approval of integrated
marketing programs
• Potential redundancy in the development of
programs
• ‘Management myopia’ few marketing managers
have responsibility for actual marketplace
results and most tend to identify with a specific
function within marketing
SBA SEMESTER ONE
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Session 3
BASICS OF MARKETING- I
Market Focused
Head of Co/Div
Sales
Mfg
Mktg
Finance
Mkt Research
Mkt Mgr A
SBA SEMESTER ONE
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Session 3
Mkt Mgr B
Mkt Mgr C
BASICS OF MARKETING- I
Market-Focused Organization
Strengths
• Concentrated focus on a defined group of
customers
• Encourages attention to and expertise in the
purchase and usage characteristics of certain
industries
• Aids coordinated delivery of diverse products to
a given customer segment and development of
‘systems’ ’solutions’-oriented programs
• Many FMCG companies have managers looking
after specific markets like organized retail or
rural markets
SBA SEMESTER ONE
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Session 3
BASICS OF MARKETING- I
Market-focused
Vulnerabilities
• Complicates interfaces with other parts of the
company ,such as manufacturing and R&D
,which are generally product focused
• Creates potential inefficiencies in manufacturing
and field operations
• ‘Market myopia’ tends to focus attention on
currently largest customer segments to relative
exclusion of small but growing segments
• Dilutes focus on product management
SBA SEMESTER ONE
Designed & developed by E4
Session 3
BASICS OF MARKETING- I
Product Focused
Head of Co/Div
Mfg
Sales
Advtg
Prod Mgr A
SBA SEMESTER ONE
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Prod Mgt
Prod Mgr B
Session 3
Finance
Mktg
Mkt
Research
Prod Mgr C
Mktg
Support
Staff
Prod Mgr D
BASICS OF MARKETING- I
Product Focused
Strengths
• A special case of functionally focused organization
• Puts one person in charge of making a business
plan work for each major product
• Broad-based ,cross functional training and
exposure:clear career path with increasing
responsibilities
• Shortens response time between changes in
strategy and changes in product plans and
programs
• E.g. In many FMCG Companies, there are brand
managers looking after individual brads reporting to
category managers
SBA SEMESTER ONE
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Session 3
BASICS OF MARKETING- I
Product Focused
Vulnerabilities
• Creates potential duplication in support
functions
• ‘Marketing myopia' tends to focus attention on
specific product requirements rather than
market needs
• Complicates coordination of marketing activities
if several products are sold to the same
customer (s)
• Dilutes functional expertise
SBA SEMESTER ONE
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Session 3
BASICS OF MARKETING- I
Product Teams
Alternative can be to switch from product managers to
product teams
• Vertical product team
• Triangular product team
• Horizontal product team
SBA SEMESTER ONE
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Session 3
BASICS OF MARKETING- I
Marketing Organization
PM
APM
PA
Vertical product team
PM
R
Triangular product team
C
PM
R C S D F E
Horizontal product team
Ref: Marketing Management by Philip Kotler
SBA SEMESTER ONE
Designed & developed by E4
Session 3
BASICS OF MARKETING- I
Internal Relations
Marketing department has two tasks:
• Co-ordinate the company’s internal marketing
activities.
• Co-ordinate marketing with other company
functions.
SBA SEMESTER ONE
Designed & developed by E4
Session 3
BASICS OF MARKETING- I
Ref: Marketing Management by Saxena
SBA SEMESTER ONE
Designed & developed by E4
Session 3
BASICS OF MARKETING- I
Internal Relations
• Marketing and manufacturing department
expects marketing to have simple products,
narrow product lines and high volume production
• Marketing and Finance: there often conflict over
control of funds as marketing requires sizable
funds over a long period.
SBA SEMESTER ONE
Designed & developed by E4
Session 3
BASICS OF MARKETING- I