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CMOs - want to reach peak financial performance all year round? Then partner with finance!

Rowan Tonkin Profile picture for user Rowan Tonkin June 4, 2024
Summary:
CMOs can fall into the insular distractions of juggling a marketing budget. But there is a better way: instead of probing spreadsheets, get a real-time finance view. Planful's Rowan Tonkin shares field stories on how to prove the value of marketing.

Marketing and finance concept © peshkov - Canva.com
(© peshkov - Canva.com)

It never fails – you finish your annual corporate planning cycle and, a few short months later, you are scrambling to determine if you’re ahead or behind marketing goal attainment. Your CEO is asking questions, the CFO is inquiring about ROI, and your sales counterpart is, as always, looking for more, and more qualified pipeline.

It’s a familiar story for most marketers, yet it doesn’t have to be this way. All you need is a marketing plan that’s integrated with the tools you already use so you can gain real-time insights and put untapped marketing capabilities to work. A little AI wouldn’t hurt, either.

Here’s what I’ve learned in my role as CMO on ways you can get and stay ahead of your marketing goals this year and every year.

Marketing must look ahead, not behind, to plot the best course forward

Marketing teams typically gather at the end of the month and quarter to review performance. There's a lot of talk about cost-per-leads, lifetime values, click-through rates, conversion rates, qualified lead ratios, and more. You can see where you’ve done well and not-so-well, and the budget you’ve thrown at over- and underperforming campaigns for the past 30 or 90 days.

It would have been helpful to see budget utilization weeks ago. But, you can reallocate your marketing spend next month, right?

To finance teams, marketing performance is just a cryptic puzzle. That CTR/MQL/etc. alphabet soup means little; they just want you to prove how your budget is turning into revenue and profits. Same with sales. 'Show me the money,' as they say.

The challenge with the marketing status quo is that marketers tend to work in hindsight. I know because as a marketing leader, I’ve been there, working in spreadsheets, unable to easily see an accurate and near-real-time view of where all the spend sits. Then it’s a scramble at the end of the month to gather metrics, assemble them into a high-level spreadsheet, and do your best to explain it to Finance. Thirty days later, rinse and repeat.

Quantify marketing value in terms that your CFO understands

Marketing budgets are a mixed bag for 2024. A recent survey by MarketingProfs found that 48% of B2B marketers expect budget increases this year, 27% expect decreases, and 25% expect their budgets to remain unchanged. Another survey found that CFOs usually understand the 'you gotta spend money to make money' adage, but of course, they aren’t happy wasting money. If there’s any role that thrives on numbers over gut feeling, it’s the CFO.

For marketing, this means two distinct things:

  1. Speak in the language of finance, not marketing.
  2. Prove the value of marketing in business terms.

This matters because you have to show Finance that you’re spending marketing dollars wisely in just a few minutes. Finance doesn’t care about CTRs and MQLs, but they do know one acronym very well – ROI.

Articulating marketing progress, spend, budget needs, and return in dollars is how you engage with Finance. Using that language to then show how marketing spend is resulting in business outcomes is how you get Finance to invest more in Marketing’s efforts. 

Connecting finance and marketing insights

Cvent, an industry-leading meetings, events, and hospitality technology provider, experienced the challenges that came with disconnected marketing and finance data. The company managed its budget in over 50 disconnected, offline spreadsheets, which hampered access to real-time data and reduced their ability to forecast and monitor marketing expenses accurately.

Cvent’s marketing team partnered with Planful to centralize spend management and gain visibility into budgets, track progress toward goals, and identify potential areas of overspending. This allows the team to quickly access up-to-date information, empowering them to make well-informed decisions rooted in real-time insights. Christine Kelly, Manager of Marketing Technology and Automation at Cvent, says:

By operationalizing our marketing plan, we have set the foundation to measure ROI and prove the value of marketing via data.  

We have increased efficiency in forecasting a large complex budget every month. Now budget managers can easily forecast based on real-time data.

Better marketing outcomes run through finance

The best CMOs build a business case that CFOs and CEOs will buy, they collaborate and communicate frequently, clearly, and in the language of business, not marketing. And when the C-suite can clearly understand the CMO’s business case, and it’s articulated in business terms, it removes all the friction in the conversation.

When you speak in the language of finance, it’s easy to get the CFO on board and together, explore a new world of planning possibilities. You can partner with finance on strategic direction, show them how you’re repurposing spend to higher impact and higher ROI programs, and prove — in dollars — the value marketing brings to the business.

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