Unit 4: - Marketing Organisation - Marketing Audit

UNIT 4
•Marketing Organisation
•Marketing Audit
Marketing Organisation
– Marketing organisation is a cluster of specialized individuals who work towards
accomplishing the marketing objectives of the firm by properly dividing the
work, responsibility and authority.
– Works as structural unit an responsible for overall sales plan.
– Have clear responsibility and functions for individual, group or department.
– Able to deliver high market share, sales potential and customer loyalty.
Factors Influencing Size of the
Marketing Organisation
– Internal Factors
1. Philosophy of Top Management
2. Product Policy- entering new markets, which results in diversion from
functional structure to product and market-based structure to target different
areas.
3. People- number, type, capabilities, qualifications, attitudes, personalities, fear,
ambitions, suspicions and other intangible factors.
– External factors
– Business environment
– Micro; customers, suppliers, regulatory bodies, competitors
– Macro; political, legal, technological
– Consumer Requirement and Expectations: Specific types of expectations and
services to customers
– Channel Distribution:
– Indirect; depends on outside sales force and organisation is leaner
– Direct; own sales force and wider size.
Types of Marketing
Structures/Organisations
– Refer text Book
Types of Marketing Control:
Marketing Control Techniques
Annual Plan Profitability

Control Control
Strategic Efficiency
Control Control
Ensuring the achievement of sales, profits and other goals established in annual plan,
by;
– Monthly or quarterly goals are set by the management
– Its performance in the market place is observed by the management
– The reason for deviations in actual performance
Annual – Corrective actions are taken
Plan
– In order to evaluate the plan performance, five different tools are used
1. Sales Analysis: Comparing actual sales with the expected sale.
Control 2. Market Share Analysis: Comparing firm’s sales with that of prevailing market sales.
3. Market Expense to Sales Analysis: Ensuring that the firm does not get involved in
unnecessary expenses and more than required amount is not spent while achieving
the sales target.
4. Finance Analysis: Factors affecting the rate of return, financial leverage and return
on assets of a firm.
5. Customer Attitude Tracking:
– Customer Surveys, Customer panels, feedback and suggestion system
Profitability Control
1. Determining Operational Expenses- Salaries, warehousing costs, taxes, office
rents, ad., sales promotion.
2. Assign the Functional Expenses to Marketing Entities
3. Prepare a profit and Loss Statement for each marketing Entity
Strategic Control
– The management can maintain a balance between firm’s marketing and
external environment.
1. Customer Relationship Management
2. Marketing Audit: analysis of firms marketing strategies and activities
Efficiency Control
Finding out better ways in which a task can be executed.
Sales Force Efficiency:

• Average number of sales calls
• Increase in number of new customers
Advertising Efficiency
• The advertising expense via media, incurred for reaching target customers
• Percentage of ad. target that has been achieved till date
Distribution Efficiency
• By analysing total sales with total sales by channel member
• Total cost per channel.
Marketing Audit
This refers to the comprehensive, systematic, analysis, evaluation

and the interpretation of the business marketing environment,
both internal and external, its goals, objectives, strategies,
principles to ascertain the areas of problem and opportunities and
to recommend a plan of action to enhance the firm’s marketing
performance.
Features Of Marketing Audit
– The Audit should be Comprehensive, i.e. it should cover all the areas of marketing where the
problem persists.
– The Audit should be Systematic, i.e. an orderly analysis and evaluation of firm’s micro & macro
environment, marketing principles, objectives, strategies and other operations that directly or
indirectly influences the firm’s marketing performance.
– The audit should be Independent; the marketing audit can be conducted in six ways: self-audit,
audit from across, audit from above, company auditing office, company task-force audit, and
outsider audit. The best audit is the outsider audit; wherein the auditor is the external party to an
organization who works independently and is not partial to anyone.
– The audit should be Periodical; generally, the companies conduct the marketing audit when some
problem arises in the marketing operations. But it is recommended to have a regular marketing
audit so that that problem can be rectified at its source.
Components of Marketing Audit
– Macro-Environment Audit: It includes all the factors outside the firm that influences the marketing
performance. These factors are Demographic, Economic, Environmental, Political, and Cultural.
– Task Environment Audit: The factors closely associated with the firm such as Markets, Customers,
Competitors, Distributors and Retailers, Facilitators and Marketing Firms, Public etc.that affects the
efficiency of the marketing programs.
– Marketing Strategy Audit: Checking the feasibility of Business Mission, Marketing Objectives and
Goals and Marketing Strategies that have a direct impact on the firm’s marketing performance.
– Marketing Organization Audit: Evaluating the performance of staff at different levels of hierarchy.
– Marketing Systems Audit: Maintaining and updating several marketing systems such as Marketing
Information System, Marketing Planning System, Marketing Control System and New-Product
Development System.
– Marketing Productivity Audit: Evaluating the performance of the Marketing activities in terms of
Profitability and Cost-Effectiveness.
– Marketing Function Audit: Keeping a check on firm’s core competencies such as Product, Price,
Distribution, Marketing Communication and Sales Force.

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UNIT 4

Annual Plan Profitability

Annual – Corrective actions are taken

Sales Force Efficiency:

This refers to the comprehensive, systematic, analysis, evaluation

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