Just joining us? You can find Part One of this blog here. To recap, based on several years of investments made into marketing technology and customer experience (CX) programs, executives have been placing increased pressure on CMOs to show a return. Although CMOs understand the importance of proving out ROI, it’s remained a challenge for many. Further, hot topics like CX remain a strategic priority for many organizations, but interestingly, Gartner’s latest CMO spend report predicts a shift in focus. They predict that by 2022, profitability will be the new priority. Along with this, Gartner predicts a cut in spending for CX programs by 25%.
Placing the customer at the center of your business has shown to pay off for organizations that embrace this mindset. Unfortunately, the barriers to proving the return that are experienced by so many marketing executives can place these critical CX programs at risk.
By aligning with the CFO, marketers will be able to better justify budgets, understand how ROI is calculated, and work with the finance team to prove marketing’s value to the business.
In Part II of this blog, we’ll discuss some suggestions for marketing leaders to begin to align with finance for better accountability and marketing outcomes:
1. Get the Conversation Started
Seek to understand financial accounting with genuine interest. Discuss with accounting colleagues in your firm how they estimate the value of marketing assets. This will either give you much needed insights into their process, or it might even help them realize there are gaps in capturing the contribution marketing makes. Eventually, setting up a cadence for collaboration will ensure there is a continual stream of communication occurring throughout this process. Any changes will take time, but having a targeted discussion will at least make you aware of potential challenges and opportunities.
2. Ensure Marketing Operations Are Optimized
Now would be a good time to revisit your organization’s current state of marketing operations. Doing so will help the marketing team close any gaps in processes, technology, or employee-based roadblocks ahead of time. When it comes to process, something you should be checking is how analytics are being considered in marketing programs and in what part of the process. Effective marketing operations consider analytics from the beginning, whether it be link tagging, event tracking, confirming that reporting is possible, and more. As it pertains to marketing technology, confirm your marketing, sales, and other technology applications can pass data to the right system(s), including those that have revenue figures. Only after you have these major gaps closed can you consider improving data and analytics capabilities for the future. This may include things like leveraging new technology, developing talent internally, or getting help from partners.
3. Place a Priority on Clean Data
Having clean data is an absolute must for organizations. It could mean the difference between being able to prove out value vs. losing trust from other departments by working with inaccurate data. You may need to work with your analytics department to come up with a data collection and governance plan. You also may find that you need to clean up a large portion of your data. In some cases, this can turn into a major data cleanup initiative.
4. Confirm You’re Aligned with Sales
This is extremely important for all organizations, especially in business-to-business environments in which outside sales representatives are the ones making the transactions. This is already a major focus in the industry for CMOs who have embraced revenue marketing. However, not all organizations are quite there yet. If you find yourself having friction with the sales team and working to prove out how marketing is contributing to the sales pipeline, you’ll have some pre-work to do before you’ll be able to realistically engage with the finance department.
Maintain Realistic Expectations
It’s not realistic to track every single tactic and every single possible touch-point dollar-for-dollar in driving profit—or even revenue, for that matter—but by preparing yourself for better alignment today, you’ll be able to dramatically increase marketing’s accountability and enhance how you demonstrate value to the business.
You’ll even become one of the most highly sought-after marketing leader types of the future—the kind who understands data and can translate it into business value.
Keep in mind that you don’t need to take this all on yourself. Some of these initiatives may require executive-level support, such as a data cleanup initiative. Further, improving how marketing’s value to the businesses is captured absolutely requires finance’s support. If finance and marketing can become more engaged in understanding each other, both parties can work together to increase accountability, performance, and enterprise value.