1 Ad-hoc activity. At this stage there is no formal organisation related to e-commerce and
the skills are dispersed around the organisation. It is likely that there is poor integra-
tion between online and offline marketing communications. The web site may not
reflect the offline brand, and the web site services may not be featured in the offline
marketing communications. A further problem with ad-hoc activity is that the main-
tenance of the web site will be informal and errors may occur as information becomes
out-of-date.
2 Focusing the effort. At this stage, efforts are made to introduce a controlling mecha-
nism for Internet marketing. Parsons et al. (1996) suggest that this is often achieved
through a senior executive setting up a steering group which may include interested
parties from marketing and IT and legal experts. At this stage the efforts to control the
site will be experimental, with different approaches being tried to build, promote and
manage the site.
3 Formalisation. At this stage the authors suggest that Internet marketing will have
reached a critical mass and there will be a defined group or separate business unit
within the company that will manage all digital marketing.
4 Institutionalising capability. This stage also involves a formal grouping within the
organisation, but is distinguished from the previous stage in that there are formal
links created between digital marketing and the company’s core activities.Although this is presented as a stage model with evolution implying all companies
will move from one stage to the next, many companies will find that true formalisation
with the creation of a separate e-commerce or e-business department is unnecessary. For
small and medium companies with a marketing department numbering a few people
and an IT department perhaps consisting of two people, it will not be practical to have a
separate group. Even large companies may find it is sufficient to have a single person or
small team responsible for e-commerce with their role being to coordinate the different
activities within the company using a matrix management approach.
Activity 4.5 reviews different types of organisational structures for e-commerce. Table 4.6
reviews some of the advantages and disadvantages of each.CHAPTER 4· INTERNET MARKETING STRATEGY
Table 4.6 Advantages and disadvantages of the organisational structures shown in Figure 4.23
Organisational Circumstances Advantages Disadvantages
structure
(a) No formal structure Initial response to Can achieve rapid response Poor-quality site in terms of
for e-commerce e-commerce or poor to e-commerce content quality and
leadership with no customer service responses
identification of need for (e-mail, phone). Priorities not
change decided logically. Insufficient
resources
(b) A separate committee Identification of problem and Coordination and budgeting May be difficult to get different
or department manages response in (a) and resource allocation departments to deliver their
and coordinates possible input because of other
e-commerce commitments
(c) A separate business Internet contribution As for (b), but can set own Has to respond to corporate
unit with independent (Chapter 6) is sizeable targets and not be strategy. Conflict of interests
budgets (>20%) constrained by resources. between department and
Lower-risk option than (d) traditional business
(d) A separate operating Major revenue potential or As for (c), but can set High risk if market potential is
company flotation. Need to strategy independently. Can overestimated due to start-up
differentiate from parent maximise market potential costs