Finance doesn’t always see Marketing as a driver of business growth and capable of creating significant impact, and marketing doesn’t always make their case very clearly. Luckily that’s not the case at Allocadia! CMOs wear a lot of different hats, but at the end of the day I see revenue growth as my top responsibility.
In 2021, if you want your business to be successful, you need to have a growth mindset. After surviving a rollercoaster year, it should be clear by now that finance and marketing have equally important roles to play when it comes to company growth. Finance, with their company-wide view into budgets, plans, and performance is a fantastic (and in my opinion under-used) resource for marketers. And marketing, with all our programs and campaigns is delivering that growth.
These are my three pieces of advice to build a strong marketing and finance partnership.
Lead by Example
If you have a positive attitude, your team will absorb that outlook as well. It’s on us, as leaders of our organizations, to set a good example and create a trickle down effect of mutual respect and collaboration.
How do we start modelling that? It’s simple, start by asking questions!
Dedicating ample time to ask questions and listen is always a great place to start building a relationship. It’s on us marketers to open up the dialogue on performance. Ask what Finance cares about most. Take time to understand their strategy, what their targets are, and then think critically about how your marketing programs can help achieve those targets.
The next step is learning more about each other’s internal processes and timelines. The more your marketing team operates in step with their world then the easier it becomes on everyone. Something that will make this even smoother is understanding what level of detail into marketing programs and spend finance thinks is useful. Reconciling the two departments can be difficult enough without adding in extra information beyond what’s helpful. Work with them to establish a level of detail so they aren’t missing or overloaded by data.
Be Partners in Planning
To varying degrees, all of us marketers have adopted agile marketing practices this past year. Much of it was forced on us by necessity – we had to learn to react quickly or risk falling behind. But while we’ve changed our operating habits, finance’s remain unmoved.
It’s a delicate balancing act between moving quickly on new market opportunities and keeping on top of budgets so you aren’t overextending on commitments. But I’m telling you: it can be done. And it starts with marketing and finance becoming planning partners.
The cleanest way to start is focus on creating a closed loop between your own marketing plans, forecast, and actuals. This will help you know where every dollar is, at any given moment. Then make sure your finance counterparts have the same visibility. Once you know exactly what spend is committed, moving quickly becomes much easier and won’t cause future headaches with over or under spending. Another way to reduce hurdles is by keeping a portion of your budget uncommitted to leave room for this flexibility. Just don’t forget to actually use it! And when you invest your slush fund, make sure to keep finance in the loop. Set up regular and frequent check ins so that there are no nasty surprises when it comes to expected spend.
Finance can also be an invaluable partner when it comes to scenario planning. The point of scenario planning is vetting options early so you can pivot quickly based on a business change or market opportunity. And finance’s opinion on how the business would want to approach these scenarios from an investment perspective is incredibly helpful. It’s not just a matter of plan A,B, or C based on budget, but asking questions like:
- In the case of A, what financial business outcomes are we most trying to optimize for?
- If market opportunity X were to arise, how do we feel about investing more aggressively to pursue it?
These discussions help marketing better understand the business strategy and make sure that all their budget scenarios support company goals and targets. Which leads into my last piece of advice…
Rally Around Mutual Success Points
Driving revenue, driving impact, driving growth: marketing and finance may achieve these on their own, but not to the same degree as when they work together. A solid marketing and finance partnership should be based on mutual goals and objectives. When you understand each other’s point of view, aligning on goals becomes a foundational piece of all your activities. Finance can help shed light on what’s most important to the business right now; not just from a numbers perspective, but from a growth perspective. And if it’s about growth, I’m all ears!
Working on a greater frequency of transparent reporting and communication is especially helpful during and post-COVID. Spending efficiently is still a critical priority, so the more proactive both departments are about visibility into spend and aligning to business strategy, the better we all are for it. Creating clarity also helps cement what your mutual success points are and then coming up with a plan for how each team can help support achieving your shared goals. With budgets still being tight, maybe it’s staying within 1% of your planned budget. Or it’s doubling down on a big investment and thinking through how to bring a return five times greater.
When it comes to ROI, there’s even more reason for marketing and finance to work together. Getting buy-in early from Finance on marketing’s ROI metrics makes it easier to build investment strategies and budgets that clearly articulate and show how the marketing plan is expected to deliver on those ROI metrics. You’re defining – and agreeing – on what success looks like up-front which automatically sets up alignment for your future conversations. Now all you need to do is measure spend performance and do what marketing does best: deliver that ROI.