BASICS OF MARKETING I

BASICS OF MARKETING I Session 3 Internal Environment 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. 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 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 Session 3 BASICS OF MARKETING- I

Head of Co/Div Finance Mktg Sales Mfg Prod Mktg Advtg Mkt Research Functionally Focused 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 SBA SEMESTER ONE 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 Session 3 BASICS OF MARKETING- I

Head of Co/Div Mfg Sales Mktg Finance Mkt Research Mkt Mgr A Mkt Mgr B Mkt Mgr C Market Focused 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 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 SBA SEMESTER ONE Session 3 BASICS OF MARKETING- I

Head of Co/Div Mfg Sales Mktg Finance Mktg Support Staff Prod Mgt Mkt Research Advtg Prod Mgr A Prod Mgr B Prod Mgr C Prod Mgr D Product Focused SBA SEMESTER ONE Session 3 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 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 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 Session 3 BASICS OF MARKETING- I

PM APM PA PM C R PM R C S D F E Marketing Organization Vertical product team Triangular product team Horizontal product team Ref: Marketing Management by Philip Kotler 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. SBA SEMESTER ONE Session 3 BASICS OF MARKETING- I

Ref: Marketing Management by Saxena 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. SBA SEMESTER ONE Session 3 BASICS OF MARKETING- I

BASICS OF MARKETING I