Optimize Your Organizational Structure

As catalog companies grow and their business strategies change, having an effective organizational structure can help executives improve results. Of course, the size and complexity of a business will determine how many people are needed to make any structure work.

This month, we’ll examine typical organizational structures for catalogs of all sizes and how effective hierarchies can be established.

Structures and Teams

In a large corporation that has other business units, the front end of a catalog operation—marketing, merchandising and creative—generally reports to a catalog director or vice president. In a more typical catalog operation, they report to a president and/or CEO.

In other companies, the creative group might report to marketing or merchandising, especially if it’s outsourced or the services are obtained from the creative division.

Another effective method is to organize teams around titles. The teams generally are marketing, merchandising, creative and/or operations, and they report to a team manager, who then answers to a group vice president or executive vice president. Note: This structure often is too expensive to maintain in a small to medium-sized company due to job redundancies on the teams.

The key to any successful and effective organization is the amount of integration and communication that happens between these functions. No matter what the reporting relationship, it’s crucial to have shared goals and objectives. This makes it’s easier to know what actions specific people must take and each function’s contribution toward common goals.

Marketing

The marketing group should be responsible for developing and executing mail plans, acquiring new customers, and providing market research and other information to the company.

Within this department, you generally find circulation managers and analysts; research and/or database marketing analysts; and someone who focuses on managing the list or working with an outside list manager and broker. In some organizations the merchandising analysis also is done by the marketing group, because this area often has the staff most skilled in analytical work.

This department may have a more simple structure in a one-title operation. Multiple titles often are handled by different circulation directors, managers or analysts.

Merchandising

Merchants are responsible for product planning and analysis, item selection, supply-chain management and catalog layout/pagination. The merchants generally are the most accountable group of people in a retail/catalog operation, so they usually have the widest span of control.

The most successful catalogers give merchants approval authority on the creative presentations as well. This doesn’t diminish the value of the creatives in the process; it simply defines the roles of final approval. Good merchants will leverage their peers’ knowledge and experience to maximize the effectiveness of every item.

Merchandise groups are comprised of merchandise directors and managers, buyers, buying assistants (clerical staffers), inventory managers, control buyers and others.

Depending on company size, buyers could be organized around titles, product categories or both. A structure organized by product category enables buyers to develop expertise and drive the business. But in single-category catalogs, a structure organized by title might make the most sense—it allows the buyer to become intimate with the customer.

It’s best to separate the forecasting/ordering function from the merchandise analysis/product selection function. A control buyer who hasn’t selected the product will be much more objective about how to forecast it. However, the control buyers and other buyers must communicate regularly and partner in dealing with vendors. That’s also why it’s unwise to have the inventory function report to a financial or warehouse director. Vendors must know that everyone at a company speaks with one voice.

Creative

The creative group is responsible for working with marketing and merchandising to execute the physical representation of the brand. They take a product and make it “sing” on the page.

Once the creative group decides on the products to put on each catalog page and which items belong in the hot spots, they format the presentations. Functions such as creative director, art director, designer, production artist, copywriter, photo studio manager, photographer, photo art director and stylist make it all happen.

In a small organization, the creative director may do everything from developing concepts to page production (including the photo art direction and styling). In a larger company, these functions become more specialized.

Usually, creative groups are organized around titles at the art director level (and sometimes at the designer level). Photo art directors often report to the creative director or photo studio manager.

Similarly, a stylist may work for the art director or photo studio manager, but often they operate as freelancers, since their skills are highly specialized.

No matter what your company’s size, you must ensure these functions are happening. And remember, the larger the organization, the more imperative it is to foster effective communication across the structure, in addition to up and down it.

Phil Minix is the managing director of catalogs for Reiman Publications. You can reach him by e-mail at pminix@reimanpub.com.