Speaking “CFO”

Here is a great article on how CMOs need to interact better with CFOs if they want more influence over business strategy and budget. In particular, this paragraph caught my attention:

A recent study by Marketing Management Analytics (MMA), found that just 7 percent of finance executives are satisfied with their company’s ability to measure marketing ROI. In the same study, only 23 percent of marketing executives had confidence in their ability to measure returns, still not exactly a ringing endorsement.

Marketing doesn’t have to be a guessing game, but it becomes one for two reasons:

1. Marketing executives get list-centric. Because they struggle to show results, they quickly gravitate to showing off their punch list of marketing tasks. If you want to be treated like an executive, you have to stop acting like an employee.
2. Marketing executives are using dated data-points like CPM. Cost per Thousand is largely irrelevant with the advent of TiVos and web-based content. Marketing executives would serve themselves well to implement closed-loop tactics such as web traffic and conversion percentages. In addition, best key performance indicator for marketing ROI is cost per customer. At a minimum, you can at least show the finance executives that your marketing efforts are leading to increased sales while lowering over-all marketing costs. That should keep them happy.

Got something to say?