Functional organization

Functional organization

The company must have people who can carry out marketing analysis, planning, implementation and control. If the company is very small, one person might do all the marketing work - research, selling, advertising, customer service and other activities. As the company expands, organizations emerge to plan and carry out marketing activities. In large companies there can be many specialists: brand managers, salespeople and sales managers, market researchers, advertising experts and other specialists.

Modern marketing activities occur in several forms. The most common form is the functional organization, in which functional specialists head different marketing activities - a sales manager, advertising manager, marketing research manager, customer service manager, new-product manager. A company that sells across the country or internationally often uses a geographic organization, in which its sales and marketing people run specific countries, regions and districts. A geographic organization allows salespeople to settle into a territory, get to know their customers, and work with a minimum of travel time and cost. Companies with many, very different products or brands often create a product management or brand management organization. Using this approach, a manager develops and implements a complete strategy and marketing program for a specific product or brand.

Example

Product management first appeared in Procter & Gamble in 1929. A new soap, Camay, was not doing well, and a young P & G executive was assigned to give his exclusive attention to developing and promoting this brand. He was successful, and the company soon added other product managers.

Recent dramatic changes in the marketing environment have caused many companies to rethink the rule of the product manager. Today's consumers face an ever-growing set of brands and are now more deal-prone than brand-prone. As a result, companies are shifting away from national advertising in favor of pricing and other point-of-sale promotions. Brand managers have traditionally focused on long-term, brand-building strategies targeting a mass audience, but today's marketplace realities demand shorter-term, sales-building strategies designed for local markets.

A second significant force affecting brand management is the growing power of retailers. Larger, more powerful and better-informed retailers are now demanding and getting more trade promotions in exchange for their scarce shelf space. The increase in trade promotion spending leaves less resource for national advertising, the brand manager's primary marketing tool.

Example

To cope with this change, Campbell Soups created brand sales managers, these combine product manager and sales roles charged with handling brands in the field, working with the trade, and designing more localized brand strategies. The managers spend more time in the field working with salespeople, learning what is happening in stores, and getting closer to the customer.

See also