Unsure where to place your ecommerce team? Grappling with choosing the right ecommerce organizational model? You aren’t alone.
“One of the hardest things with commerce is that the rest of the organization doesn’t understand how it fits in, how to attract talent, how to pay for it, and how different it is from any other functional group,” says Santiago Lopez Mora, senior vice president of Amazon and digital commerce at Revelyst.
Based on insights from the Digital Shelf Institute’s (DSI’s) report, “Organizational Structure: Where Ecommerce Started — and Where it’s Heading,” here’s what your brand should consider as you weigh your options.
Why Brands Struggle To Determine Where Ecommerce Should Sit
Here are some common roadblocks that you may face when deciding where to place your ecommerce team.
- Limited digital capabilities: If you’re still growing your ecommerce maturity, you may not have fully integrated digital into your operations yet.
- The sales-or-marketing conundrum: You may house your ecommerce team under sales or marketing, or share ownership of ecommerce between these departments.
- Budget: If your digital initiatives budget is spread across several teams, it isn’t always clear who pulls the financial levers.
- Organizational workflows: Most brands don’t change how they work when they integrate ecommerce. They typically bolt it onto existing processes, so no one team or leader assumes full responsibility for it.
3 Top Organizational Models for Ecommerce Success
If you want to accelerate your digital shelf growth, you need the right organizational model for your ecommerce function.
The DSI recommends these three organizational models:
- Sales-focused model
- Marketing-focused model
- Center of excellence (CoE) model
Sales-Focused Model
The sales-focused model works best if a sales team primarily leads the brand.
In this model, the ecommerce leader — typically a vice president or C-suite role — and their team directly report to the head of sales.
Benefits of the Sales-Focused Model
The sales-focused model directly links sales results to digital initiatives, making it easier for ecommerce teams to unlock budget access and get resource investments. This model also offers a direct line to retail customers through the sales organization.
Sales-Focused Model Challenges
Sales teams may not understand the nuances between digital and in-store channels, leading to misalignment. Therefore, ecommerce teams need to educate their sales counterparts and work to create a shared language.
Marketing-Focused Model
The inverse of the sales model, this approach works best if the brand is very marketing-oriented.
Benefits of the Marketing-Focused Model
This model can foster more harmony, since marketing and ecommerce teams often have similar objectives and are naturally aligned. Marketing teams are also an invaluable asset for ecommerce teams when it comes to product positioning.
Marketing-Focused Model Challenges
Placing the ecommerce team in marketing can further distance it from customers, so ecommerce teams need to collaborate more with the sales organization.
Center of Excellence Model
Consider this model the go-between. In a CoE model, ecommerce can sit within marketing or sales or operate as a standalone function.
The CoE model encompasses an integrated, cross-functional team that accelerates your digital capabilities and standardizes digital sales and marketing efforts.
This team typically owns digital strategy and governance, content creation, and syndication.
CoE Model Challenges
This model may advance a brand’s digital maturity more quickly, and it can also help to gain executive buy-in and drive cross-functional alignment for digital initiatives.
Challenges Posed by the CoE Model
Because a CoE often owns digital strategy and governance, content creation, and syndication, there’s a risk that it could become a gatekeeper rather than an enabler of ecommerce innovation.
CoE models are also resource-intensive to build and maintain, and they require really thoughtful and diligent change management, especially in today’s evolving ecommerce environment.
"Digital is never set-it-and-forget-it. That may be part of the education you need to do within your organization,” says Sheri Stoller, director of ecommerce, Trilliant Food and Nutrition. “It's ongoing. Ecommerce changes very fast, digital changes fast, and the consumer is changing even faster, so you really have to make sure that you are in lockstep.”
The Power of a Global Ecommerce Team
Along with these three main models, there’s another option your brand can explore: a global ecommerce team.
The global ecommerce team supports regional teams and has three key benefits:
- Efficiency and scale: It centralizes work to reduce redundancies and duplication, allowing you to move faster and, over time, also generate cost efficiencies.
- Shared knowledge: A global ecommerce team accelerates knowledge-sharing across markets, collating best practices and market-specific insights that can support growth initiatives.
- Brand continuity: Centralizing content creation and deployment helps you maintain your unique brand voice and identity across different regions.
A global ecommerce team may not be the right structure for every company, depending on its footprint.
However, this approach could work if you can create content at a global level and then allow each market to activate it, or if a global ecommerce team reduces content creation costs.
Which Model Is Right for You?
The right organizational model provides support, resources, and strategic capital that propel your ecommerce team.
But what’s “right” differs by company. If sales are the hub of your business, then embedding ecommerce within this function might make the most sense.
If marketing drives your operations, then aligning ecommerce with this department may lead to better digital shelf performance. If you think a cross-functional team would work best, then a CoE model may be optimal for your brand.
Start With Introspection
Lauren Livak Gilbert, executive director of the DSI, says whichever route brands decide to take, they should start with some introspection.
“The most common question I get when organizations are building out a team is, ‘What level should this role be?’” she says. “I challenge brands to instead ask, ‘What are the jobs that need to be done?’ Even one step up from that, ‘What are our goals, and what are we trying to achieve?’”
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