Marketing and finance are often depicted as opponents. But are we really on opposite sides?
Most of our blogs are from a marketing perspective, but we thought we’d switch it up. We talked with Samantha Bannister, Allocadia’s SVP of Finance and Operations, to get her five tips for building a strong marketing/finance relationship:
- Be a resource, not an opponent
- Make persuasive arguments
- Get buy-in from Sales
- The right decisions are easy to make
- Know when to put on your company hat
Tip #1 – Be a Resource Not an Opponent
Finance’s role is to manage all investments and allocation of spend in the company’s best interest. Marketing’s role is to drive revenue and growth for the company. And a lot of friction is created by the different ways these two departments think about investments.
Accrual accounting is often an issue because marketing already committed funds, but finance hasn’t received the bill yet. Finance can help marketers give them the right information the first time around by defining the level of detail they need into committed funds, as well as the process and rules around submitting invoices and POs. For their part, marketers should try to provide as much visibility into their budgets with frequent forecasting and amortizations. In layman’s terms: keep planned investment info up-to-date and have it mapped to the correct quarter or fiscal year.
Let’s all acknowledge and embrace the fact that marketing and finance have different skills sets, but ultimately everyone is working towards a common goal for the company.
Tip #2 – Make Persuasive Arguments
How can you be persuasive in a zero sum game? Any additional funds that go to marketing, mean the company chose to forego another investment. It’s fair that finance wants to be able to thoroughly vet new requests and opportunities.
If marketers are confident that this is an opportunity for the business that can’t be missed, they need to have the right pitch. Look at the market and all your data, then package your metrics to demonstrate how additional resources will positively impact sales and pipeline, and support the overarching goals and strategy for the organization.
On the flip side, if finance wants to make cuts to marketing’s budget they need to first think about how that will impact revenue. No one wants to defund a high-performing program. But there could be other areas where a budget decrease is if not a win-win then at least not a lose-lose scenario.
Tip #3 – Get Buy-in From Sales
Wait… isn’t this article about marketing and finance alignment? Yes, but having support from sales is a big part of creating a strong relationship between marketing and finance.
Sales, marketing, and finance are all key stakeholders that have the ability to impact revenue and growth for the company on a day-to-day basis. They should all be aligned on taxonomy and core KPIs that are used to measure success. If sales calculates close rates differently from marketing and finance, it makes it really difficult to focus on important things like outlining next quarter’s strategy because you have to spend so much time cleaning up your respective numbers.
Tip #4 – The Right Decisions Are Easy to Make
Focus the conversation about what everyone cares about: ROI. Both marketing and finance care about driving revenue for the company.
If each department explains their needs and expected impact in the language of the business – ROI – it’s pretty clear what the right decision is. Performance metrics appeal to everyone, meaning the data can speak for itself when presented to the rest of the C Suite or your board. The easier that marketing and finance can make that process, then the closer they get to their goal.
Tip #5 – Know When To Put On Your Company Hat
You can’t always get what you want. Sometimes there’s no way around it and budgets need to be cut. Almost everyone faced that unfortunate reality earlier this year.
When that happens, instead of finance making unilateral decisions, marketing needs to put on their company hat and come prepared with their own budget recommendations. Know the business: it’s goals for this year, the strategy shifts, and where resources are constrained. Again, performance metrics will come in handy so you know which investments create the maximum ROI and where you can afford to pull back.
With changing conditions, it’s a smart skill for marketers to be able to gracefully fluctuate their budgets. More isn’t always more. Experienced marketing experts know that it’s smarter to ask for more budget after you have the results to back up your request. A good practice is planning programs to roll-out in phases so that it’s easier to dial things up and down if budgets fluctuate.
Everyone’s professional environment is different, but we can all work to improve the situation we’re in. The best part is that all of these tips are something you can start doing right now.
Marketing and finance both want the same thing: to drive growth and revenue for our organization. When we build a strong relationship, that creates a solid foundation which allows everyone to move faster and more confidently on decisions that create business impact.
If you’re serious about driving impact for your company then it’s time to get serious about marketing and finance alignment.