Marketing Org & Control

7/31/2019 Marketing Org & Control

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UNIT-V MARKETING ORGANIZATION AND CONTROL

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 e.g.: 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


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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.

Eg : 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


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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 knowledge4. 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 whichcreates 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.


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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


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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, and customer

segment and trade channel.

3) Efficiency control: It is used to assess 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 whether 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 percall

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 assess the effectiveness of different marketing mix elements.


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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 Organisation 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.

Marketing Function Audit: It is a functional audit mainly covering marketing mix components namely product, price, place and

promotion (advertising, sales promotion, sales force and publicity)

GREEN MARKETING

According to theAmerican Marketing Association,green marketing is the marketing of products that are presumed

to be environmentally safe. Thus green marketing incorporates a broad range of activities, including product

modification, changes to the production process, packaging changes, as well as modifying advertising. Yet defining

green marketing is not a simple task where several meanings intersect and contradict each other; an example of this

will be the existence of varying social, environmental and retail definitions attached to this term. Other similar terms

used are Environmental Marketing and Ecological Marketing.

Green, environmental and eco-marketing are part of the new marketing approaches which do not just refocus, adjust

or enhance existing marketing thinking and practice, but seek to challenge those approaches and provide a

substantially different perspective. In more detail green, environmental and eco-marketing belong to the group of

approaches which seek to address the lack of fit between marketing as it is currently practiced and the ecological and

social realities of the wider marketing environment.

The legal implications of marketing claims call for caution. Misleading or overstated claims can lead to regulatory or

civil challenges. In the USA, theFederal Trade Commissionprovides some guidance on environmental marketing

claims. This Commission is expected to do an overall review of this guidance, and the legal standards it contains, in

2011.
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Green/ environmental marketing

Unfortunately, a majority of people believe that ecological (green) marketing refers solely to the promotion or

advertising of products with environmental characteristics. Terms like Phosphate Free, Recyclable, Refillable, Ozone

Friendly, and Environmentally Friendly are some of the things consumers most often associate with green marketing.

While these terms are green marketing claims, in general green marketing is a much broader concept, one that can

be applied to consumer goods, industrial goods and even services. Thus, green marketing incorporates a broad

range of activities, including product modification, changes of the production process, packaging changes, as well asmodifying advertising. Green marketing came into prominence in the late 1980s and early 1990s, it was first

discussed much earlier. The American Marketing Association (short: AMA) held the first workshop on Ecological

Marketing in 1975 The proceedings of this workshop resulted in one of the first books on green marketing entitled

Ecological Marketing. According to Dainora Grundey and Rodica Milena Zaharia Green or Environmental Marketing

consists of all activities designed to generate and facilitate any exchanges intended to satisfy human needs or wants,

such that the satisfaction of these needs and wants occurs, with minimal harmful impact on the natural environment

.[17]
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CYBER MARKETING

Cyber Marketing combines the creative and technical aspects of the Internet with design,

development, advertising, and marketing part of a business.

Internet Marketing methods consist of:

Search engine marketing

Display advertising

E-mail marketing

Affiliate marketing

Interactive advertising

Viral marketing

Social Media Advertising

Mobile Advertising

The main aim of this course is to learn about the alternative marketing choices to consider in

planning a marketing program that may involve the Internet. The Internet can play many

important roles within a traditional marketing effort and it can also serve as the foundation of a

firms marketing effort.

Although the Internet is increasingly prominent in successful marketing programs, recent

developments have shown that it is not an easy ticket to success

.

Marketing and ecommerce professionals today need a good understanding of which marketing

objectives that can be achieved using electronic tools and which objectives are best approached

by traditional means. Marketing is about anticipating and satisfying buyers needs. The purpose of

this course is to acquaint you with the special behavioral considerations for buyers that emerge

when the Internet plays a role in the firms marketing.


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Internet marketing, also known as web marketing, online marketing, webvertising, ore-

marketing, is referred to as themarketing(generally promotion) of products or services over

theInternet. Internet marketing is considered to be broad in scopebecause it not only refers

tomarketingon theInternet, but also includesmarketingdone via e-mail and wireless media.

Digital customer data and electronic customer relationship management (ECRM) systems are

also often grouped together under internet marketing.[1]

Internet marketing ties together the creative and technical aspects of the Internet, including

design, development, advertising and sales.Internet marketing also refers to the placement of

media along many different stages of thecustomer engagementcycle throughsearch engine

marketing(SEM),search engine optimization(SEO),banner adson specific websites,email

marketing,mobile advertising, andWeb 2.0strategies.

In 2008,The New York Times, working withcomScore, published an initial estimate to quantify

the user data collected by large Internet-based companies. Counting four types of interactions

with company websites in addition to thehitsfrom advertisements served from advertising

networks, the authors found that the potential for collecting data was up to 2,500 times per user

per month.[3]

Types of Internet marketing

Internet marketing is broadly divided in to the following[4]

types:

Display advertising: the use of web banners or banner ads placed on a third-party website

orblogto drive traffic to a company's own website and increase product awareness.[4]

Search engine marketing(SEM): a form of marketing that seeks to promotewebsitesby

increasing their visibility insearch engineresult pages (SERPs) through the use of either

paid placement, contextual advertising, and paid inclusion, or through the use of freesearch

engine optimizationtechniques.[5]

Search engine optimization(SEO): the process of improving the visibility of a website or a

web page in search engines via the "natural" or un-paid ("organic" or "algorithmic") search

results.[6]

Social media marketing: the process of gaining traffic or attention through social media

websites such as Facebook, Twitter and LinkedIn.[7]

Email marketing: involves directly marketing a commercial message to a group of people

using electronic mail.[8]

Referral marketing: a method of promoting products or services to new customers through

referrals, usually word of mouth.[9]

Affiliate marketing: a marketing practice in which a business rewards one or more affiliatesfor each visitor or customer brought about by the affiliate's own marketing efforts.

[10]

Inbound marketing: involves creating and freely sharing informative content as a means of

converting prospects into customers and customers into repeat buyers.[11]

RELATIONSHIP MARKETING

Relationship marketing is a strategy designed to foster customer loyalty, interaction and long-term
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engagement. This customer relationship management (CRM)approach focuses more on customer

retention than customer acquisition.

Relationship marketing is designed to develop strong connections with customers by providing them with

information directly suited to their needs and interests and by promoting open communication. This

approach often results in increased word-of-mouth activity, repeat business and a willingness on the

customers part to provide information to the organization.

Relationship marketing contrasts withtransactional marketing, an approach that focuses on increasing the

number of individual sales. Most organizations combine elements of both relationship and transaction

marketing strategies.

See also:direct marketing

RELATED GLOSSARY TERMS:masthead,crowdcasting,CRM (customer relationship

management),microsegmentation,cannibalization

CUSTOMER RELATIONSHIP MANAGEMENT

What is CRM (customer relationship management)?

CRM (customer relationship management) is an information industry term for methodologies, software,

and usually Internet capabilities that help anenterprisemanage customer relationships in an organized

way. For example, an enterprise might build adatabaseabout its customers that described relationships in

sufficient detail so that management, salespeople, people providing service, and perhaps the customer

directly could access information, match customer needs with product plans and offerings, remind

customers of service requirements, know what other products a customer had purchased, and so forth.

Ask your CRM questions at ITKnowledgeExchange.com

According to one industry view, CRM consists of:

Helping an enterprise to enable its marketing departments to identify and target their best

customers, manage marketing campaigns and generate quality leads for the sales team.

Assisting the organization to improve telesales, account, and sales management by optimizing

information shared by multiple employees, and streamlining existing processes (for example, taking

orders using mobile devices)

Allowing the formation of individualized relationships with customers, with the aim of improving

customer satisfaction and maximizing profits; identifying the most profitable customers and

providing them the highest level of service.

Providing employees with the information and processes necessary to know their customers,

understand and identify customer needs and effectively build relationships between the company, its

customer base, and distribution partners.
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Many organizations turn to CRM software to help them manage their customer relationships. CRM

technology is offered on-premise, on-demand or through Software as a Service

(SaaS) CRM, depending on the vendor. Recently, mobile CRM and theopen sourceCRM software model

have also become more popular.
http://searchcloudcomputing.techtarget.com/definition/Software-as-a-Servicehttp://searchcloudcomputing.techtarget.com/definition/Software-as-a-Servicehttp://searchcloudcomputing.techtarget.com/definition/Software-as-a-Servicehttp://searchenterpriselinux.techtarget.com/definition/open-sourcehttp://searchenterpriselinux.techtarget.com/definition/open-sourcehttp://searchenterpriselinux.techtarget.com/definition/open-sourcehttp://searchenterpriselinux.techtarget.com/definition/open-sourcehttp://searchcloudcomputing.techtarget.com/definition/Software-as-a-Service

Documents

Marketing Org & Control