Vanessa Bruns is a marketing researcher at Google. She focuses on understanding how marketers can capitalise on new opportunities to align more closely with the wider business.
Marketing and finance leaders in the C-Suite want the same thing — long-term growth — but their differing approaches are hindering effective, profitable collaboration between the two.
That’s according to new research from Google, NewtonX, and the consultancy, Project X Initiative. The research we conducted together reveals the obstacles the two teams face when trying to align strategically, based on in-depth focus groups and interviews with 250 senior marketing and finance executives in Europe.
Finance and marketing leaders largely agree that marketing drives long-term growth.1 However, short-term financial pressures often misalign their goals, with finance teams prioritising immediate returns and marketing struggling to secure investment in long-term brand building.
Based on this status quo, here’s what CMOs should do to build a better relationship with their finance counterparts and unlock marketing’s potential:
Plan for the long-term together
Our research found significant differences in marketing and finance leaders’ strategic priorities. Marketing leaders are placing more emphasis than their finance colleagues on longer-term brand building and positioning.2 Finance leaders, often bound by strict budget constraints and the pressure of quarterly results, are focusing most on profitability or margin.3
"We are in an era of short-term wins, which has more weight than anyone would like,” said one marketing director who participated in the research. “But those [wins] have to be hit.”
There are also clear differences in how CMOs and CFOs perceive their level of collaboration. Only 43% of marketing leaders feel there is a shared understanding of marketing strategy, compared to 61% of finance leaders.4 This underscores an interesting recurring issue: while many finance leaders view current levels of collaboration as sufficient, marketing leaders don’t.
Many organisations lack the tools and processes needed to bring the two functions closer together — for instance, less than half of marketing and finance leaders said that they conduct joint planning and review sessions.5
CMOs should seek to build trust with their CFOs through early engagement, holding key discussions on resource allocation and long-term brand investments.
As you build that trust, marketing leaders can become better aligned to their finance counterparts. They can help finance leaders scope out how best to invest in the future by operating with agile budgets. Supported by clear insights, joint review sessions, and financial analysis, CMOs and CFOs together can optimise marketing spend to drive business goals.
Establish shared KPIs through a common language
A disconnect between marketing performance metrics and wider business KPIs further exacerbates strategic misalignment.
Our research found that finance leaders consider difficulties measuring the long-term impact of campaigns as their main challenge when aligning with marketing teams.6 Meanwhile, roughly one-third of marketing leaders cite difficulties in linking marketing performance to financial metrics as a major challenge.7
Ultimately, this can mean businesses miss out on measuring marketing’s long-term contributions.
Marketers and finance teams need to understand how these key marketing metrics have an impact on revenue and cost efficiency. Equally, marketers must grasp key concepts from their finance leaders so that they can align their strategies more closely with the business’ goals.
CMOs and CFOs should establish a common framework for assessing marketing performance, using KPIs which align to both financial and marketing goals. CMOs can utilise longer-term measures such as customer lifetime value and incremental revenue to provide a clearer picture of marketing’s contribution.
Create a unified approach to data and AI
A sound collaboration rests heavily on the strength of the data teams are using to make decisions. But our research paints a bleak picture. CFOs frequently said they had major concerns about poor-quality, poorly integrated, and fragmented data. A third of finance leaders said data integration issues posed a challenge for them — a significantly higher proportion than marketing leaders.8
The global head of marketing at a German online retailer told us: “Data reliability is the biggest challenge. It’s difficult to make frequent analyses when data isn’t always complete or refreshed. This takes time and affects both marketing and finance.”
A knock-on effect of poor data is a business’ inability to unleash the power of ever-evolving AI tools. AI depends on high quality, integrated data. It can provide real-time insights and more accurate attribution modelling for marketers, improving the ability to demonstrate ROI for both short-term and long-term campaigns.
Marketers recognise AI’s transformative potential, but its adoption remains fragmented. Decentralised initiatives, reactive investments, and reliability concerns hinder widespread, effective AI implementation.
CMOs can consolidate customer data into a shared platform. Through aligning datasets with the newly-created, shared KPIs, marketers can use AI tools — as part of an integrated AI approach — to optimise campaigns and track measurable outcomes. For CFOs, this will help link financial data with marketing performance, with clear evidence of how marketing investments contribute to revenue growth, customer acquisition, and brand building.
Trusted partners
Ultimately, effective collaboration between CMOs and CFOs relies on a mutual understanding of each other’s work.
By fostering open communication and bridging the gap between marketing and finance objectives, CMOs and CFOs can unlock marketing's true potential to drive sustainable growth.
Read "The Effectiveness Equation" report for more marketing and measurement insights.
