Designed & developed by E4

SBA SEMESTER ONE Session 3 BASICS OF MARKETING- I

BASICS OF MARKETING I

Session 3

Internal Environment

Designed & developed by E4

SBA SEMESTER ONE 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.

Designed & developed by E4

SBA SEMESTER ONE 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 resourcesE.g. Having a sales force or distributors sales force

or the fact the smaller marketing organizations outsource marketing services like Market Research, Advertising etc

Designed & developed by E4

SBA SEMESTER ONE Session 3 BASICS OF MARKETING- I

Functionally Focused

Finance

Head of Co/Div

Mfg Sales Mktg

Prod Mktg Advtg Mkt Research

Designed & developed by E4

SBA SEMESTER ONE Session 3 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

Designed & developed by E4

SBA SEMESTER ONE Session 3 BASICS OF MARKETING- I

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

Functionally Focused

Designed & developed by E4

SBA SEMESTER ONE Session 3 BASICS OF MARKETING- I

Market Focused

Finance

Head of Co/Div

Mfg Sales Mktg

Mkt Research

Mkt Mgr A Mkt Mgr B Mkt Mgr C

Designed & developed by E4

SBA SEMESTER ONE Session 3 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

Designed & developed by E4

SBA SEMESTER ONE 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

Designed & developed by E4

SBA SEMESTER ONE Session 3 BASICS OF MARKETING- I

Product Focused

Head of Co/Div

Mfg Sales Mktg Finance

Advtg Prod Mgt Mkt Research

Mktg Support

Staff

Prod Mgr A Prod Mgr B Prod Mgr C Prod Mgr D

Designed & developed by E4

SBA SEMESTER ONE Session 3 BASICS OF MARKETING- I

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

Product Focused

Designed & developed by E4

SBA SEMESTER ONE 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

Designed & developed by E4

SBA SEMESTER ONE 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

Designed & developed by E4

SBA SEMESTER ONE Session 3 BASICS OF MARKETING- I

Marketing Organization

PMAPMPA

Vertical product team

R C

PM Triangular product team

PM

R C S D F EHorizontal product team

Ref: Marketing Management by Philip Kotler

Designed & developed by E4

SBA SEMESTER ONE 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.

Designed & developed by E4

SBA SEMESTER ONE Session 3 BASICS OF MARKETING- I

Ref: Marketing Management by Saxena

Designed & developed by E4

SBA SEMESTER ONE 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.