For years, business books suggested that the biggest adversary to the CMO -- as well as the biggest opportunity for partnership -- was the head of sales. After all, sales depends on marketing to build brand awareness and nurture leads to position sales to achieve revenue targets.
Now, however, the dynamics have changed. Marketing budgets stand at 11.2% of company revenue, according to Gartner -- with martech accounting for nearly a third of that -- and marketing often has direct responsibility for revenue via ecommerce and overall customer experience. CMOs now must focus on bridging a new divide: one with the CFO.
A strong finance-marketing relationship can give organizations a competitive edge, yet barriers persist. According to consultant EY, 54% of CFOs report greater collaboration with CMOs over the last three years but say cultural differences and absence of common KPIs remain challenges.
With an increasing share of wallet, it is more critical than ever that CMOs understand the CFO’s remit when pencils inevitably sharpen. CMOs must provide visibility into marketing ROI in achieving broader corporate objectives, doing so in a way that’s relatable to the CFO by speaking their “dollars and sense” language.
Here are tips for meeting on common ground:
Understand the new CFO role. The traditional CFO role focused on core financial duties. According to KPMG, today’s CFOs are expected to have a strategic outlook that includes understanding emerging technology to help drive innovation, while developing new creative ideas based on data insights. Help CFOS with that broader remit by being a partner beyond P&L responsibilities, sharing insights, best practices, and helping them stay informed on broader business opportunities.
Align KPIs to company objectives. There’s no doubt of marketing’s importance to the business: delivering leads, helping advance deals and serving as champion of the customer experience. But to demonstrate ROI meaningfully to a CFO, it’s important to communicate how marketing drives a return on the company objectives CFOs care about.
According to a survey from market researcher Censuswide, 94% of CFOs would increase digital marketing budgets based on clear evidence the investment resulted in sales. A good measurement dashboard should show marketing’s impact on traditional metrics like brand awareness, leads and conversions as well as impact on overall brand health, revenue, customer loyalty, and profitability.
Be partners in keeping the customer first. Marketing is the steward of the customer journey, engaging with partners across the business to deliver a consistent, world-class customer experience. The CFO should be no different.
Work with your CFO to ensure common understanding of customer needs and brand experience at every touch point. For example, your CFO may not think about the implications of receivables policies, but a poor experience -- no matter where -- can impact satisfaction and loyalty. Nothing fuels business growth like a great customer experience. It’s up to you to ensure your CFO understands that.
Keep the conversation going. Find a rhythm of sharing progress with your CFO as a partner -- via formal meetings and dashboards, and informally over lunch or a mutual social interest. Start sharing a small number of metrics with a plan to track and share larger-scale metrics over time. Ask questions and listen to your CFO to demonstrate genuine interest in their challenges, and find ways to help.
Of course, your partnership with the head of sales should not fall by the wayside. Over time, you can serve as connective tissue to help build the relationship between the CFO and head of sales, proving an even deeper value to your CMO role.