Although there has been ample warning, economic headwinds have arrived and chances are marketers aren’t prepared. New research from the CMO Council finds that just a mere 10 percent of marketing leaders strongly believe their marketing investments—whose reins are often held by finance—position them to emerge from economic turmoil ahead of the competition.
The Council’s new report, Marketing & Finance: Fueling Innovation Or Falling Behind?, produced in collaboration with professional services firms network KPMG, examines the often fractured marketing and finance relationship, and how marketing leaders can achieve a higher level of confidence in their investments.
The research found that the challenges to deeper marketing/finance collaboration include differences in metrics and goals, priorities and incentives, risk assessment, timetables, etc. What’s needed are stronger connections between budget and marketing planning, execution and performance, which will give greater visibility across marketing and finance teams.
Key findings include:
- Only 10 percent of marketers strongly believe their marketing investments position them to emerge from economic turmoil ahead of the competition
- Nearly 4 in 5 CMO-CFO partnerships aren’t very willing to collaborate on investments, goals and metrics
- Among CMO-CFO partnerships that are indifferent or hesitant to collaborate, only 27 percent are satisfied with their ability to innovate
“If marketing and finance wish to successfully navigate economic headwinds, they’ll need to redefine their working relationship and align on financially responsible growth strategies that prioritize smart, realizable, innovative investments,” said Donovan Neale-May, executive director of the CMO Council, in a news release.
Unlocking innovation in marketing strategy requires alignment and collaboration between marketing, finance and other C-suite peers. To strengthen the CMO-CFO partnership, CMOs should:
- Show how investment in their marketing strategy will drive value for all functions of the business
- Integrate customer data across marketing, sales and finance and leverage customer data as a common language
- Identify and prioritize steps to improve four core capabilities: innovation, agility, collaboration, performance
“A strong relationship between marketing and finance has become even more crucial in the current socioeconomic environment to ensure an organization’s effective targeting, clear ROI, and transparent budgeting,” said Jason Galloway, customer advisory lead and marketing consulting practice lead at KPMG LLP, in the release. “A clear view into the marketing plans and a deeper understanding of current performance, allows for better overall buy-in from the finance team that ultimately has the final say on budget. Smarter and timely marketing investments can lead to greater profitability and allow organizations to stay ahead from the competition.”
The report is based on a survey of over 275 marketing leaders across industries and geographies. Additionally, we conducted in-depth interviews with marketing executives from Fiserv, Vitamin Shoppe, Schneider Electric, Agios Pharmaceuticals, and others.