A guest blog post from Joshua Jamieson, Senior Consultant at QuintoVate, a management consulting firm with broad experience in Marketing Operations and a singular focus on Marketing Performance. QuintoVate consultants strengthen the role of marketing by creating alignment and improving communication among marketing, finance, and IT.
Allocadia partners with QuintoVate to help our customers smoothly transition to an enhanced way of managing their marketing performance.
Marketing financials. Those two words can trigger thoughts of chaos, “Excel Hell”, and compiling hundreds of custom budgets into a single report that no one would even understand without you standing over their shoulder.
Better insight into marketing financials and overall marketing financial performance is a critical and immediate need for marketing operations, marketing VPs, and CMOs. Better insight leads to better, quicker decisions which lead to accountability that will resonate across the organization. Marketing departments are often treated as “cost centers” and continue to perform as they always have (good or bad) despite this need. Implementing a Marketing Performance Management (MPM) tool can prove out marketing as a trusted center of excellence in your organization.
First, a caveat!
Our success helping Marketing teams become more accountable requires a very important, foundational element to lead off: Marketing departments who focus on a strong relationship with Finance and Sales will be far more successful using spend data to drive decisions. Although, according to Allocadia’s 2017 Marketing Performance Management Maturity Study, only 14% see Finance as a strategic trusted advisor and 28% said they have no relationship with Finance or speak only when they have to. While that can be a completely different topic to discuss, it’s important to ensure Marketing and Finance teams are on board with your efforts to use spend and revenue data to transform Marketing. Partnerships with these departments with clear roles and expectations will set you up for a much smoother path forward.
What do we need to make better decisions?
First, consider your systems. Which enterprise systems will you use for your data? You may use Customer Relationship Management software, Enterprise Resource Planning software, and/or a Marketing Automation platform. Think about which elements of these systems need to be used in your marketing performance management processes, so they can be linked with other data and reported on. This can sometimes throw marketers for a loop, and that’s exactly why technology choices are so critical.
Next, establish your key metrics. You’re about to transform the way you use spend and performance data, so this is a great time to re-think your decision-making process. What information should you record in your budgets? What data is qualitative? What data is quantitative? What information do you actually need? Are there line items or details you could exclude from future budgets? Are there line items or details that you need to begin recording? Is your data actually helping you make better decisions, or is it extraneous? Are you ensuring that your CMO and marketing executives can see the data that they want to see? These questions are a good start to defining your key metrics. You may find some variances between your current state and your desired state, and that’s okay. Plot a course to close this gap.
Finally, leverage a marketing-centric technology partner such as Allocadia. Make the decision to leave “Excel Hell” and choose a technology partner who is ready to help you make sense of your marketing budgets the way marketing operates; avoid re-purposing other existing enterprise applications that are not built for Marketing. We’ve seen firms try “make it work” with other platforms like sales force automation, ERP systems, and business intelligence platforms with the best of intentions, only to fall short of the goal to give marketers the decision support tools they truly need.
Organizational imperatives clarify the argument, every time.
Deciding where to apply valuable, finite resources always leads to healthy debate. After all, marketers are creative and diverse in thought, and ideas are never scarce. We like to see organizations who establish and communicate corporate objectives around which the entire organization can rally because clarity of direction helps everyone prioritize accordingly. Aligning Marketing campaigns to strategic organizational goals will help to regulate some of these debates. Not directing enough resources toward new account growth? A well-defined MPM program can help highlight that so you can adjust before committing funds.
Fasten your seatbelts.
Harnessing data in a structured format that is purpose-built for marketer’s needs means Marketing can make quicker, more nimble decisions. Is one of your attrition programs performing poorly? Redirect those funds to a high-performance program with confidence and speed. Having data at your fingertips will highlight committed vs. uncommitted funds so you can transition efforts quickly. Not waiting for a roll-up of line items or activities, and not waiting for updated spend data from Finance means you have the decision support you need.
It’s important to remember Finance’s role in all of this. Be sure to establish a marketing spend cadence that aligns with Finance’s annual spend process. There are “natural” elements of the fiscal year that are very important to Finance; you probably already follow some of these today. Set the annual, quarterly, and monthly activities in stone, but also allow for new ideas to help you evolve the process. The key is to assemble and communicate the process in a way that will ensure adherence from marketing and unwavering support from Finance.
Support the CMO-CFO relationship.
It’s not uncommon for a bit of angst between Marketing and Finance and, as mentioned above, it’s critical to have Finance on board with your MPM program. While an MPM program helps you make better, quicker marketing program decisions, there are internal benefits as well. The ability to reconcile the marketing forecast against the system-of-records maintained by Finance can improve the life of the Marketer.
Imagine running a marketing forecast on the first day of the month that shows a confident re-forecast; this re-forecast contains a full accounting of the original planned spend alongside actuals-to-date and updated planned and committed spend (i.e. a PO has been cut or a statement of work has been signed). Marketing decisions are dynamic, and spend fluctuates accordingly. Keep all of your marketing spend decisions alongside the system of record finance data for an at-a-glance look at your view of the world. When the CMO provides updates, she can do so with confidence that also resonates with the CFO.
Implementing a Marketing Performance Management system gives your organization that invaluable insight into your true marketing performance. Transform the perception of Marketing from a cost-center to a strategic and revenue-driven department. By gaining control of your investments and making data-driven decisions, you not only demonstrate your value to leadership, but you align Marketing with Finance helping to yield overall success for your organization.
If you would like to hear more about how QuintoVate can help your organization transition to an enhanced way of managing marketing performance, get in touch with us at firstname.lastname@example.org or call us at (402) 392-4017.