There is no right way to tackle global markets. When deciding upon a structure that best matches your international needs, the objective should be to create the most efficient system based on the needs of your company, your shareholders, and your products and services. Ultimately, the structure must be strong enough to achieve corporate goals and flexible enough to withstand market pressures.
By definition, international marketing is the performance of business activities that direct a flow of goods and services to consumers or users in more than one nation for a profit. Depending upon your source, there are four or five basic marketing structures that can support these activities and several operational factors that can impact your decision of which structure will work best for your organization.
While the exact descriptions vary somewhat, marketing structures should be developed based upon the operational arrangement of a company. Begin by identifying with which operational arrangement you are dealing. The company may be a multinational organization with primarily overseas operation and a portfolio of independent, often country-specific, product brands. Or, it may be arranged as an international company in name, but function primarily as a domestic operation with overseas sales operations viewed as profit appendages. A third operational arrangement is more global, consisting of overseas manufacturing and a sales pipeline delivery to a unified global market. A fourth operational structure is the most complex: an organized, integrated network in which overseas operations may manufacture product components in one country, assemble in another, distribute globally, but manage product sales people, or information among geographically-dispersed, but interdependent units.
The Basic Decision: Centralized versus Decentralized
Once the underlying operation has been identified, consider how it functions. The first basic marketing structure decision that must be made is whether marketing will be conducted from a centralized location where decisions are made at headquarters (HQ) and simply executed in the field, or if decision-making will be decentralized; made independently in the regions or countries where the manufacturing, distribution and sales are occurring. rnrnCentralized marketing requires strong communications and solid organizational processes to be successful; otherwise, the lack of communication of company policies and goals will slow marketing to a crawl. It also demands a more uniform approach to everything from messaging to pricing and promotional activities. rnrnDecentralized marketing allows for localized, or at least country-specific, decision-making and message modification based on cultural attributes like affluence or literacy. While it facilitates rapid decision-making, it can also lead to a fragmented brand.
Marketing Structure: Aligned Around Products
Marketing structures aligned around products are focused on the delivery of the products for specific customer groups. These dedicated cross-functional teams tend to include product-expert vertical teams, such as a cross-functional group including product management, manufacturing facilities, call centers, direct sales teams, and customer service groups, all focusing on a specific product or group of products and a global customer base. This marketing structure is aligned around product expertise and is focused on providing the best product to meet the needs of the most customers. While there is usually a company headquarters and management staff, the group is often multi-national with offices dispersed around the globe.
Marketing Structure: Aligned Around Geographic Areas
In other international marketing structures, teams are organized around geographic areas of the world: North Africa, the Caribbean/South America, Asia, North America, etc. They may all deliver the same group of products, but the team adjusts the product attributes, positioning, pricing and messaging based upon the geographic area of the globe they serve. Marketing expertise is not in the products, but knowledge of the audience to which the products are to be offered. These teams may be cross-functional groups, and may or may not be overseen directly from the company's headquarters. Typically, they revolve around a geographic, regional office.
Marketing Structure: Aligned Around Processes and Activities
Another marketing organizational structure is one closely aligned to distribution channels or the company's physical, in-country manufacturing capability. With this structure, marketing is designed to focus on key accounts and global direct sales, or big ticket, multi-million dollar sales with long lead times. This is common in manufacturing and technology industries. Another marketing structure more common in wholesale/retail sales revolves around seasonal product lines. This includes short lead-time distribution and activities with set market schedules, showrooms, and both major and minor accounts. The global fashion industry is an example of this structure.
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