Choosing the Right Marketing Structure
By Sarah Threet, Marketing Consultant at Heinz Marketing
The rise of technology has significantly changed the strength and positioning of the marketing function within an organization over the past two decades. Historically, the purpose of marketing was to pursue brand and marketing goals that were not directly related to the overall business strategy, but now it is strategically important that marketing leaders collaborate with the rest of the organization on an overall strategy.
Marketing has evolved to take a more holistic and customer-centric focus, delivering an excellent experience that requires that everyone across the organization to be aligned on the brand purpose. A strategic and high performing marketing department is purposeful in its positioning and in the delivery of their values to both customers and their own employees. A powerful brand purpose can help align an organization through their workflow because each employee has a clear understanding of the messaging and can make autonomous decisions with the brand values at top of mind.
As the marketing function evolves, so too must the structure of the department and organization in order to support the execution of their strategy.
Defining Marketing Structure and Its Purpose
The marketing organizational structure divides and oversees marketing operations and strategies within the organization. The structure of the department helps to define and organize job roles, hierarchy, and outlines the marketing process. An effective structure is one that efficiently supports business objectives and workflow while providing clarity of business objectives.
The question that CMOs ask when reconsidering the structure of their marketing department is not only “how?” but also with consideration of the way that the marketing function is integrated through all aspects of the business process. Harvard Business Review conducted a study on CMOs and observed that CMOs recognized that “marketing is no longer a discrete entity (and woe to the company whose marketing is still siloed) but now extends throughout the firm, tapping virtually every function.”
No Singular Ideal Marketing Structure
Marketing leaders argue that there is no “one size fits all” when adopting a structure for your organization, every business has different needs, and different kinds of structures may be better suited to supporting those needs. When considering the appropriate kind of org chart, marketing leaders need to define and center their marketing purpose, aligned with their business values and goals, and couple that with a strategic workflow that achieves those marketing goals.
Additional aspects to consider when choosing the appropriate org structure are chain of command, span of control, and centralization. Chain of command maps on the hierarchal order of the org structure; it defines authority and accountability. The span of control defines the roles of each division and the management of each division. Centralization refers to the organization process of decision-making; a centralized business has only a couple of final decision-makers, whereas a decentralized business allows for autonomous decision-making throughout the divisions.
You’ll know you have chosen an appropriate structure to begin with when the structure you choose supports clear and fair division of work, clear communication between employees and divisions, and an efficient process with coherent goals.
Common and Emerging Marketing Structures (Pros and Cons)
Traditionally, businesses and marketing structures have been managed linearly with an authoritative and centralized “chain of command”. This kind of structure, with only a few final decision-makers, frequently has difficulty with decision-making and is not very efficient for collaboration and communication. “Middle management” comprises of managers who oversee specific areas of the business and refer directly to the executives above them. Information is passed up to decision-makers through gates, causing bottlenecks and inefficiencies. This organizational structure is only appropriate for small businesses with only a few employees.
Let’s look at and consider some other organizational options – keep your brand purpose and current strategic workflow in mind. Once again, there is not a singular perfect model that works across all companies. Each structure has advantages and challenges:
This common organizational structure comprises of specialized teams or function groups: an assortment of employees with similar job aspects. Team leaders manage function groups and make decisions at the functional level; they report to senior executives when necessary.
- Easier to manage on a larger scale because it can easily adjust to changes in the business as it grows
- Consistent and efficient work because work does not involve employees outside of their function.
- May limit cross-functional collaboration and communication.
- Messaging may be misaligned if departments are not clear about the brand purpose.
- Can create silos in decision-making and decrease efficiency.
These organizational structures arrange their teams around a focus, such as a product/service, market, or geographical location:
- This kind of structure is ideal for a business selling multiple products or services. Employees are separated into divisions that focus on an individual product or service line. Each division may comprise of employees from every specialized function.
- Market-based (Segment-based)
- This structure is best for businesses that target parts of a market or industry. The industries and types of consumers are the inspiration for this organizational structure.
- As there are cultural influences on buying patterns, international companies may divide their teams by geographical location so that each team can develop a local marketing strategy that targets their specific audience.
- Each division has independence from one another and can make decisions autonomously.
- Marketers can create diversified strategies and messaging that target different kinds of consumers.
- This structure is specialized for changing consumer behavior.
- This structure may be combined with other organizational structures.
- Lack of communication between division lines could muddy up brand purpose.
- Resource allocation and scalability can be difficult to manage and execute.
This structure is a hybrid of product and functional structure. It includes a functional manager and a project/plan manager who typically would have equal authority over the team. Matrix structure works best for arranging teams or departments based on their roles and the product/service line that they handle. Functional roles are permanent, and the employee has capacity within their role to work on specialized projects.
- Having multiple specialized teams touch the product/service can facilitate more efficient communication and information exchange.
- May adapt and respond to market changes more quickly; offers flexibility in the workflow.
- Interdepartmental collaboration can easily align on the brand purpose and maintain consistent messaging. This kind of collaboration also facilitates employees developing new skill sets.
- Matrix allows for further specialization by incorporating a division-based structure, assigning singular employees in each team to a particular market or industry.
- May be difficult to initially implement and should require a step-by-step prioritized implementation process and accompanying change management strategy.
- Managerial roles between the project and functional manager need to be clearly defined or there could be confusion with regard to decision-making and accountability, which could hurt communication and slow down the review process.
- Capacity needs to be tracked by a marketing operations (or equivalent) team in order to not cause work overload.
Increasingly popular, the network structure partners businesses with highly specialized functions and may outsource for certain business functions. This could look like two or three larger companies sharing resources and collaborating or it could be a larger organization with divisions that operate autonomously.
- Shares resources and information; saves money and internal capacity.
- Expands professional relationships.
- Allows the companies to focus more on their internal operations and higher-value work.
- May be easily over-complicated if there is no single source for information, an aligned martech stack for communication and collaboration, or clearly defined processes.
- Requires high oversight in order to prevent duplication of work.
Choosing the Right Fit
Restructuring your marketing department can be a huge overhaul and can be initially very disruptive for your employees. It’s important to consider the cultural fit of the structure and to map a transition process in order to mindfully manage change. Communication with all stakeholders is fundamental in order to inspire adoption. And more than likely, a structural change will mean some changes in workflow processes, and those changes will need to be clearly communicated and defined as well.
If you remain uncertain as to which structure would be best for your company, start by conducting some internal interviews and utilizing data to find gates in the workflow. The people executing the operations every day will be the best source of information as to what is working well and what is not. Involving your employees in the discovery and decision-making process will build trust and increase the likelihood of easy adoption.