 Basic Definition

 Need for the organization

 Factors affecting marketing organization
 Principles of marketing organization.
 Marketing Organization Structure
 Types of marketing organization
structures
 'Marketing is a social process by which individual
groups obtain what they need and want through
creating, offering and freely exchanging products
and services of value with others.

 Organization: a group of people who work

together

 Marketing Organization provides a vehicle for

making decisions on products, marketing
channels, physical distributions, promotions and
prices.
Physical Mktg
Distribution Channels Product

Making
Decisions

Promotion Prices
 NEED FOR THE
ORGANIZATION
1. In the market where consumer is the king we
need to satisfy the consumer. So a good marketing
operation is required.
2.Marketing organization is the pillar for success of
any organizations and provides a framework for
the following:
oDivide and fix authority among the sub ordinates
oTo locate responsibility
oTo establish sales routines
oTo enforce proper supervision of sales force
oTo avoid repetitive duties
oTo enable the top executives to devote more time
for planning policy matters
 It be categorized into
 internal factors and

 external factors
 Following are intangible factors which
affect the marketing organization

 Top Management Philosophy

 Product policy
 People
 Top Mgmt
Product
Philosophy
Policy

Internal
Factors

People
 Organizational planning and its working
is greatly influenced by philosophy
which can be good or bad

 Eg: Centralization Vs Decentralization

 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.
 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
 Business Environment

 Markets

 Consumer requirements and

expectations

 Channels of distribution
 Business
Environment

D
C i
h s M
t
a r a
n
i
b External Factors r
k
n u
t e
e i
o t
l n s

Customer
Requirements
With regards to business environment three
points are important.

 The type of environment in which the firm is

operating in terms of operations and size.

 The nature of particular requirement for

success in a given business which again
determines the size.

 The rate of change in industries being

served which again decides on its size
and working.
 This is the factor which again affects the
marketing organization i.e. one should
note about its
 Size
 Scope
 Nature
 Location
 Size

Location Markets Scope

Nature
 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.
 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.
 Objective: objective of business orgn, eg. Of
profit max. should be clearly define.

 Specialization: the activities of the member,

employee, executive manager and other
individuals should be confined to a single
function.

 Co-ordination: the work so assigned to an

individual or a group of individuals are
interrelated. One function cannot be performed
in isolation from other function.
 Authority: Depending upon the level at which
the person is working in the hierarchy, the
nature of authority delegation would differ.

 Responsibility: Authority and responsibility

are co-related.

 Definition: to define means to bring to an end

or to decide, or to fix the bounds or limits.
 Correspondence: the process of action and
reaction or the process of intercourse between
individuals.

 Span of Control: span means total spread,

stretch, area of jurisdiction or compass of
control.

 Balance: it cannot be sound in every part

unless the whole organization is directed to the
same end.
 Continuity: it suggests that the organizational
structure should be flexible or elastic.
The organization builder cannot simply
build for today or tomorrow, he must build a
fabric which can stand through years.
 The good marketing organization is one
wherein the functions or departments
have been carefully planned and
coordinated towards the fulfillment of
marketing objectives of business.
 The marketing organization of a business can
be structured on any of the following basis:
 Line and staff Organization
 Functional Organization
 Product oriented marketing organization
 Customer oriented marketing organization
 Geography oriented marketing organization
 Matrix form/Combined base
 Line &
Staff

Matrix Functional

Mktg
Org

Geographic Product Oriented

Customer oriented
 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.
 Provides expert advice from specialists.
 Relives line executes of routine,
specialize functions
 Enables young sales executive to acquire
expertise
 Helps in achieving effective coordination
 Easy to operate
 Less Expensive
 Produce confusions arriving from
indeterminate authority relationships

 Curbs the authority of experts

 Too much is expected from executives

 Decision making is taken by top

management
 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.
 Mktg Mgr

Sales
Distribution Mktg Research Sales Planning
Advt. Dept. Promotion
Dept. Dept. Dept.
Dept.
 Division of work base on specialization

 Relieves line executives of routine and

specialized functions

 Promotes application of expert

knowledge

 Helps to increase overall efficiency

 Leads to complex relationships

 Makes coordination ineffective

 Promotes centralization

 Lack of proper coordination

 Delay in taking decisions

 Organizations that produce wide
variety of products often organize
marketing, trading and promotion
with respect to a product.
 The salesmen can render better customer
service as they possess good knowledge of
product and may have close contacts with
customers.

 It makes individual departments

responsible for the promotion of specific
products.

 It facilitates effective coordination.

 It increases the employment of a number of
managerial personal

 Many salesmen of same enterprise attend

same customer each

 representing a separate product which creates

confusion in the minds of the customer.

 There may be duplication of activities.

 When the departmentation of sales
organization is done on customer basis it
is called customer oriented marketing
organization. Departmentation by
customer may be done in enterprise
engaged in providing specialized
services to different classes of customers.
 It takes into account needs of each
class of customers.

 It provides specialization among the

enterprise staff
 It makes coordination difficult

 It may lead to under utilization of

 resources in same department

 There may be duplication of activities

 These types of sales organizations are not

suitable for small enterprises.
 In a territory oriented marketing organization,
the responsibilities for marketing of various
products rests almost entirely with lines
executives. The territory managers are given
varying nomenclatures like depot manager,
district manager, area manager, zonal manager,
divisional manager etc.
 It leads to economy in terms of times
and money

 It helps in taking knowledge of local

customers

 It helps in effective control

 It requires employment of number of
managerial personnel.

 It dilutes control from head quarters.

 There are some business firms that
incorporate in marketing organization
combining all the above. Usually such
firms are multi Product, multi market
firms. At the head office level they have
number of staff departments to take care
of each specialized functions of
marketing.