CMO-CFO divide isn’t the only challenge: let’s talk about GTM C-Suite-CFO alignment

We look back on our talk at Adweek X where we discussed ‘Navigating the CMO/CFO Divide’. We started by discussing how building a strong relationship between CMOs and CFOs can help quantify brand health as business health. Focus then turned to the C-Suite, putting this relationship under the microscope to look at how the root cause of the divide and propose strategies to bridge collaboration.  

Our President, Americas, Ricky Abbott, sat down with Laura Jones – CMO at Instacart – and Paul Barbagallo – Senior VP, Executive Editor, Thought Leadership at Adweek – for a brilliant discussion and enlightening debate (if we do say so ourselves!) 

Watch the session in full, or read to to discover what we learned, what questions were raised, and what advice you should take away. 

ACT I 

Framing the Problem: The CMO-CFO Divide 

We started by looking at the basic problem, the CMO-CFO divide. 

CFOs and CMOs often find themselves at loggerheads when it comes to assessing the impact of marketing efforts on the overall financial health of their businesses. It's not necessarily that they don't want the same outcomes, but rather they're coming at things from different angles. 

CFOs understand the importance of building a brand, but the tricky part is putting a solid number on its worth. For them, it’s about a customer acquisition, profit margin, and revenue and growth. Something tangible, quantifiable. 

For CMOs, it’s about brand awareness, brand consideration metrics, and marketing performance. 

In B2C, CMOs are much closer to that conversion point than in B2B. The problem CFOs have in B2B organisations is knowing where to attribute recognition. Does it go to sales? Or does it go to marketing? This constant struggle is why you hear the need for “alignment” and to recognise the collaborative nature of their contributions. 

Act II 

Analysing the Problem: Going beyond just Marketing and Sales 

The second ‘act’ to our discussion looked at the cause of the rift between CMOs and CFOs. 

Firstly, we looked at how easily meaning can get lost in translation. That is, how important it is for CMOs and CFOs to speak the same language so that the work carried out – and its benefits – are understood in each’s own way. 

We then turned our attention to cost. Customer acquisition costs in B2B SaaS organizations have gone up 228% since the beginning of Covid, yet the cost of sales and marketing has stayed static. This isn't a good metric for the CFO. Why? Because sales, marketing, customer success, and product are all speaking to the same customer in different ways. This means businesses need a unified go-to-market (GTM) approach — the next topic of our discussion. 

Let me explain. If the customer is only one person or company, then speaking to them in one voice (whether that’s sales, marketing, customer service, or product interaction) should be paramount. And with a unified GTM approach, you can align on the same KPIs. Now, with this, the CFO doesn't have to worry about having multiple measures of success but rather fewer agreed upon GTM KPIs (with each department individually having their own KPIs). In other words, marketing can still have brand engagement and marketing performance metrics, but they ladder up to the same consolidated KPIs that the CFO is bought into. 

This situation of having a unified GTM is even more exasperated in Enterprise organizations. In these organizations, they often have multiple business units as they are multi-product organizations, and each business unit has their own P&L and so their own goals. The complexity is increased but if marketing can help drive a unified GTM across these business units, it starts the rest of the organization thinking about those other customer facing functions. 

Act III 

Solving the problem: The CMO-CFO Partnership 

The closing chapter of our talk looked at building a positive CMO-CFO partnership. 

The key lies in strategically aligning metrics that speak to the business’ financial health while showcasing the tangible and intangible value of marketing and branding initiatives. 

And the pivotal step is to find common ground. How? By aligning KPIs with board-level metrics and trickling them down to the operational level. That is, establishing a clear correlation between these tactical KPIs and higher-level P&L metrics — because when you create KPI synergy between CMOs and CFOs, you can help deliver stronger results. 

In a recent McKinsey Report, it was stated that CEOs who place marketing at the core of their growth strategy are twice as likely to have greater than 5% annual growth compared to their peers. Marketing has a really important part to play, let’s get marketing to move beyond promotion and go back to all 4 P’s (more on that in another post). 

As an example, we discussed how pivotal marketing is to pricing power — a tangible way that links the role of marketing to the bottom line. Let’s take the following as an example: If Amazon raises their prices by 33% and we all say yes, with approx. 200m customers, that adds $4 billion to their bottom line. Could that have happened if their brand was weak? No. The power of the brand is to increase price elasticity. 

Fundamentally, it's about having a single metric that’s easy to understand. Tracing the path between actions and results so that these can be explained to the CFO, and they can see the causal relationship that gives the CMO credibility and trust. 

Closing the CMO-CFO Divide 

What are your thoughts on the key takeaways from our talk at Ad Week X? We’d love to hear! 

If you're interested in exploring CMO-CFO divide research we discussed for yourself, view the report here.

Or, if you’d like to get in touch, please reach out to the Transmission team and we’ll be more than happy to help.