Next to the job description, the second most important document for me in the executive recruitment process is the organizational chart of the marketing department. As you can imagine, after 27 years in executive search, I’ve pretty much seen it all- from highly hierarchical to super flat. I even remember one digital marketing organizational structure I worked with where project leaders ruled the day- no titles, no departments, no departmental leaders, just teams all reporting up to a President.
Clients with more traditional marketing models often ask me: How should we organize for digital? Should we treat it as a completely separate functional unit, or should we integrate it into our existing marketing team? Or, in the case of billion dollar corporations, should we air drop digital experts into multiple business units to insert disruptive ideation into departmental planning? The short answer is… there IS no one-size-fits-all solution when it comes to creating an organizational chart for digital marketing. Every digital marketing organizational structure has its own strengths and weaknesses relative to business strategy. Classic organizational design theory tells you that it revolves around the culture, and based on my experience, that has never more true in this modern era of digital.
In the earliest days of online commerce, creating the org chart was simple: Let’s put these alchemists on an island of their own, and see what they stir up. Back then, the coders and programmers were mostly in charge, and of course they mostly reported up to IT. As ecommerce grew and became a more significant part of business operations, companies integrated digital capabilities into existing functions and business units, assigning distinct leaders and budgets. Today, ecommerce chiefs are found sitting at the long-table in executive meeting rooms, sometimes with SVP and even EVP titles.
Helping clients determine the optimal digital marketing organizational structure, for me, begins by asking questions- lots of them- that focus on the “why” and the “how” of their digital marketing and ecommerce operation.
Here are a few:
1- How prepared is your organization to accept change?
For a business that historically has marketed through more traditional channels, digital marketing can be culturally disruptive. The more that entrenched stakeholders will be a hindrance to change, the less isolated digital marketing should be from the existing marketing department. An effective way to accomplish this kind of digital marketing organizational structure is by creating cross-functional teams that include specialists from both old media and new media. This hands-across-the-sea approach will help create a more collaborative and knowledge-sharing digital marketing organizational structure, and as I’ve written about many times, cross-departmental collaboration is a must in order for an organization to achieve scale in digital marketing and ecommerce.
2- To centralize or not to centralize?
Generally speaking, companies will de-centralize the digital marketing and ecommerce function when specific digital expertise is required within the marketing departments of multiple business divisions, or within the marketing branches of a particular division. For example, I worked with a Fortune 100 corporation not too long ago that wanted to digitize some of its corporate communications capabilities, and they hired my candidate, along with other digital specialists, to build out teams in email and social media across marketing departments of multiple divisions. For smaller and mid-sized companies where ecommerce is a large revenue driver, creating a more centralized “center of excellence”, as some might call it, will encourage broader adoption of digital marketing techniques, plus ensure a less siloed and more integrated approach to the company’s digital initiatives. It’s also a much more effective way to attract, hire and retain strong digital marketing and ecommerce talent.
3- Is there internal know-how to plan and execute a digital strategy?
Sometimes I get calls from companies that ask me to find them a Digital Marketing Manager with the intent of bringing in a more senior level leader, such as a Director or Vice President, at a later date. If the internal knowledge base is lacking, or if a replacement hire is required, my advice is to always start at the top.
The Basic Digital Marketing Organizational Structures
Over the years, my clients have shared dozen of organizational structures for both new and exisiting digital marketing departments. Generally, they fall into one of five different categories:
Process. This is where the department is organized around areas such as customer acquisition or fulfillment or other front-end or back-end processes representing key stages of the customer journey
Markets. This structure is more common among middle and larger sized businesses that focus on distinct market segments, customer types or industries served.
Functional. This is probably the most common structure I see. Teams are grouped according to their function, eg, marketers are together in one department, sales in another and customer service in yet another.
Product. This is an organizational chart that includes stand alone marketing teams each supporting different clusters of products. This particular org scheme is more common in larger companies that sell or manufacturer various product lines.
Matrix. Many are familiar with the Matrix org chart in which workers have dual reporting relationships. Team members might report up to both a product head and a marketing leader. Because of the high degree of specialization required in many digital marketing-related roles, this form of structure has become much less common.
The beginning point for any organizational change should be your overall business strategy, Are you a pure play ecommerce business? Then customer acquisition and website conversion will be your main focus. Do you sell software-as-a-service? Then lead nuturing is more important. Are you a B2B company selling high-tech products? You might decide to organize around content. Many business are a blend of these. But at the end of the day, the way you organize should be based on those areas of marketing that directly drive your business strategy.
For many companies, the biggest challenge has been moving from being product-focused to more customer-driven. Before digital channels became mainstream, most companies were product-based. “Build it and they will come” used to dictate how marketing departments were structured. Marketing, sales, logistics and other departments focused on their own work with little overlap, creating silos between them. But today we live in a digital world where the customer is in charge. The customer journey doesn’t end with one department and begin with another. It needs to be seamless which means much greater integration among them.
Some Recent Examples
I thought it might be informative to share some of the different types of digital marketing organizational structures I’ve recently encountered- and in one case helped design- as clients continue to transform their businesses and make room for new digital leaders in Marketing and Marketing Operations:
-In this first example, a Vice President of Marketing oversees both Marketing as well as Operations. Direct reports include a Director of Customer Insight (or Market Intelligence, Customer Intelligence, or any number of similar titles), and a Product Director assigned specifically to the Web, with the various digital specialties like social, email, search and even web development, reporting up. A separate VP of Product Marketing oversees a team of product managers assigned to products that are sold and marketed via offline channels, such as field sales and trade shows. In this particular digital marketing organizational structure, product is king. As the product mix grows, the idea is that additional product managers can easily be slipped into the org chart. Marketing operations is tasked with optimizing the customer experience.
– This next client showed me an org chart that was very flat- not unusual for smaller organizations like theirs that often don’t put a lot of emphasis on position titles. Here, the responsibilities of the VP of Marketing are wide and varied, ranging from video production to training. If my memory serves me right, I believe there were something like 8 or 9 department heads reporting up to the marketing Veep. I recommended they carve it up into two groups, each run by a Director. But there was no mistake: This was a marketing driven-company all the way. Even warehouse workers and finance were considered “extended” members of the marketing team. I see structures similar to this often.
-In contrast, for another marketing group I recently worked with, and also played a hand in re-structuring, we decided to put the organizational focus on the customer journey, with department heads leading each of the stages including awareness-based branding, lead generation and conversion. After much analysis, we all reached the conclusion that this was the most optimal org chart for their specific go-to market strategy, and it also aligned very well with the CEO’s cultural vision. Knowing how much easier it is to retain existing customers than it is to acquire new ones, for this particular situation I recommended a stand-alone customer retention team, which they adopted. Marketing Operations serves a support function across the enterprise.
-Yet another client aligned their marketing team to spotlight content and contextual marketing. So much so, that only one of the three directors reporting to the VP of Marketing manages something other than demand generation or content (in this case, it was product marketing). In this structure, content is the internal “agency” and all other marketing departments are its clients.
Organizational Structures Are Never Static
With digital marketing ushering in an era of rapid transformation for businesses, the digital marketing organizational structure must evolve along with it. A number of research and advisory firms, mostly notably Forrester, argue for marketing structures that are less product or channel-focused and more customer centric, and indeed, a number of my clients have moved in that direction. The other big change I see: One way lines between the marketing leader and functional team heads have been supplanted by lots of two way arrows going back and forth as the shift to digital tears down silos. Everyone, and everything, is integrated and interconnected. Beyond that, organizational charts are truly reflections of the organization’s culture- some are organized around product, some around content, while others put design and creative at the center of the universe.
There are countless types of digital marketing organizational structures that exist for digital marketing and ecommerce-focused businesses. From an executive search perspective, it’s not so much which boxes are on the chart or where they’re positioned that matters, but rather, that each box has clearly defined roles and responsibilities, so that taken together, all marketing team members are in full coordination behind a common purpose: To drive the business.