In
organizations where marketing accountability is expected (most of them), a
disconnect between marketing and finance can lead to serious problems. EY’s
2019 “CMO-CFO Connection Report” analyzes key issues and their causes and
recommends ways to bridge the gap to support value creation and growth — which
are especially valuable during this time of upheaval brought about by COVID-19.

Nearly 50 percent of the marketing and
finance leaders surveyed say the relationship between marketing and finance at
their company is the least productive of any other in the organization. Yet, 83 percent believe that their company’s marketing would be
more effective if the two teams were more closely aligned. And, 90 percent of respondents say they believe
that their departments should work closer together to best use customer-driven
data.

The
factors that lead to the CMO-CFO divide aren’t surprising. Generally, CFOs
believe that the best way for their business to succeed is through growth
strategies such as making new investments, as well as focusing on cost-cutting
and efficiency. Marketers, however, say growth strategies that focus on expanding
the customer base and improving brand image are most important for business
success. The report advises CMOs to work with CFOs to align and enhance their
business’s growth story. Doing so could have a great impact on how customers
perceive the business.

Although
CMOs and CFOs agree that data is essential to marketing, they have different
ideas on the best ways to use it. Most CMOs surveyed believe that their top
priority should be on using data to improve relationships with existing
customers, whereas CFOs believe that driving stronger business insight from
data is most important.

The
report cites three areas that CMOs and CFOs should prioritize to improve their
working relationship. The first is spending on marketing technology. CMOs tend
to highlight the potential for growth and insight. They should also emphasize
any cost efficiencies and solutions for any associated risks, which are focal
points for CFOs. The report suggests that CMOs work with their CFO on ways to
enhance digital transformation and improve customer experiences.

It
may be necessary for CMOs to educate CFOs on the benefits of top marketing
trends and their benefits and risks; 61 percent of respondents say they believe
that their finance department is underinformed on digital marketing. As a
result, CFOs may be more averse to any associated risks. One solution the
report advises is that CMOs ask martech vendors to be clear on how they support
clients through shifts in market trends, help enhance their business enhance,
and help expand their customer base. The report also suggests that CMOs work
closely with their CIO to gain sponsorship when requesting martech investments.

The
second area is metrics; specifically, those for tracking ROI and performance. CMOs
tend to focus on qualitative data and have a more difficult time using data to
support finance’s needs, according to the report. CFOs, however, focus on
quantitative data and have more trouble seeing that there are other important factors
beyond the bottom line. Fortunately, most CMOs and CFOs surveyed agree on the
best measures to show marketing effectiveness, including return on total
marketing investment, return on total customer investment, and brand awareness.

The
third area to prioritize is data privacy and related regulations. CFOs need to
know that CMOs are on top of data privacy issues. In fact, 80 percent of
respondents believe that marketing needs better understand the impact of
privacy regulations and how they could affect the future of their company. Both
marketing and finance respondents agree on the main challenges with privacy compliance:
keeping up with the frequency of changes and updates, fully understanding where
all data is across the organization, and fully understanding which data is held
across the organization. Overcoming these challenges present an important
opportunity for the two teams to collaborate.

In
our current environment, the connection between CMOs and CFOs is more important
than ever — but is still vastly underutilized. By finding ways to work more
closely together, marketing and finance can build a stronger customer base and
financial future that, in turn, will lead to stronger short- and long-term performance
improvements and overall success.