Efforts to Centralize, Integrate Marketing Function Falling Short

March 11, 2008

This article is included in these additional categories: Agency Business | Media & Entertainment

Despite a growing trend to centralize the marketing function and integrate its disciplines, only 13% of senior marketers are very satisfied with their company’s marketing structure, according to new research by the Association of National Advertisers.

Moreover, though 37% of executives surveyed report that their marketing department interacts and advises their company at a higher level now than two years ago, only 21% say marketing interacts at the C-level of the company:

ana-marketing-structure-level-of-strategic-corporate-interaction.jpg

Among the major findings of the study, per the ANA:

  • A centralized marketing organization is the dominant structure among those surveyed, with 52% saying so.
  • Some 49% of respondents say marketing has become more centralized in the past two years:
    • Among B2B companies, 56% report increased centralization of the marketing function.
    • Among B2C companies, 39% report increased centralization.

?ana-marketing-structure-change-in-past-two-years.jpg

  • Nearly two-thirds of marketers report that their company’s marketing function has become more integrated within the past two years.
  • However, just half (52%) say their company’s marketing function has achieved actual integration.

“Companies are clearly moving to rein in dispersed marketing organizations and tightly integrate all the marketing disciplines,” said Bob Liodice, President and CEO of the ANA.? “However, at this point, creating the optimal marketing organization is still a ‘work in progress’ as these businesses continually strive to reinvent their approach to brand building.”

More finding from the ANA Study (via AdAge):

  • Reorganization has recently been an ongoing reality for marketers, with 29% now undergoing reorganization and another 39% having gone through it within the previous two years.
  • Other than the 13% of marketers who are very satisfied with their current structure, 47% say they are somewhat satisfied, 18% are neutral and 23% say they are somewhat or very dissatisfied.
  • Interestingly, just 48% of marketers say structural changes in the past two years had improved marketing ability. Some 17% say restructuring had worsened abilities, and 36% say there was no change:

ana-marketing-structure-impact-of-changes.jpg

  • Nevertheless, six of 10 (61%) say marketing’s performance has improved in the past two years.
  • Moreover, the percentage of those who say marketing leads other functions increased three points, to 26%, from two years ago; the percentage of those saying Marketing follows or has limited interactions with other functions decreased 11 points, to 8% from 19%, from two years ago.

Additional insights from the study, per the ANA:

  • Large percentages of respondents say marketing has a major impact on four key areas of the organization:
    • Overall brand development, 89%
    • Revenue/volume, 79%
    • Strategic direction, 75%
    • Market share, 71%
  • Outsourcing a portion of an organization’s marketing function to marketing service providers has grown as outsourcing costs have decreased and media fragmentation has increased:
    • 94% of respondents report outsourcing at least one marketing function, and the vast majority (86%) expect that trend to continue in the near term.
    • The functions outsourced are mainly media planning and buying, but also include creative services, marketing research and public relations.

Note: Graphs, courtesy of the ANA,?are from the report?”The Marketing Organization: Recent Trends and Future Directions.”

About the findings: The study?(membership reqd.), conducted in partnership with Guideline Inc. in Oct. 2007, is based on a survey of 132 marketing executives at both B2B and B2C companies and covers a wide range of issues and trends affecting marketing organizations.

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