New research indicates that when companies deploy marketing resources locally, they may raise growth and efficiency more than they would with centralized functions.
As companies venture into new global markets for growth, they continually experiment with organizational design. A perennial question is how to deploy marketing resources: whether it’s better to have “boots on the ground” in local markets or to centralize resources and gain the benefits of scale. Our analysis of more than 40 of the world’s largest consumer-packaged-goods companies indicates that those with a locally deployed marketing function, supported by a few larger-scale global or regional centers of excellence, outperformed more centralized peers in both effectiveness and efficiency (exhibit). Local marketers benefit from a close-up view of consumers and can respond quickly to their changing needs and preferences.
To be sure, a company’s organizational design must support its specific strategy, so locally focused marketing might not be right for every company, and there’s no single blueprint for marketing effectiveness or efficiency. That said, companies in other consumer-facing industries, such as consumer electronics or financial services, may want to investigate whether these findings hold true for them.