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Bridging the Gap Between Marketing

and Finance

Pat LaPointe March, 2016 @measureman

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Multi-­Level Defense Systems of the Modern Marketing Budget

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Meanwhile,over in Finance…

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The Marketing View

Growth in ad spend tracks with and often exceeds economic growth

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Marketing is increasingly important.

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The Finance View

Ad spend remains flat as %GDP while other sectors grow rapidly

Healthcare

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Marketing is declining in relative importance.

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What Marketing Says…

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What Finance Hears…

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Marketing: - awareness - perceptions - engagement - targeting - real-time

Finance: - profit - growth - risk - cashflow - governance

Might help drive sales Might get CEO in WSJ

Will keep the lights on Will keep CEO out of jail

Persuasion Analysis Optimism Realism

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How Should Marketing Evolve? •  Uncertainty

abounds

•  Pace of change antiquates conventional wisdom

•  Fragmentation of options exceeds human capacity

•  Analytics are still predominantly backward-looking

Marketing

Finance

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3 Steps to Better Align Marketing and Finance

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The Role of Marketing is to Drive Shareholder Value

Near-term

Cash Flow

Asset Growth Long-term

= Shareholder Value

+ more customers

+ more $/customer

+ better margins/$

+ customer value

+ brand equity

+ corp. reputation

1 (re)Define the ROLE of Marketing

Speak the language; “Point” data and analytics at the right things

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2 Shift Focus in the Information Era

Experiments

20%

Scaled Execution 80%

“Prove” “Justify” “Defend”

Efficient Execution Era Information Era Forecast ROI By Segment

“Learn” “Iterate”

“Simulate”

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In Marketing, Accuracy Credibility.

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3 Triangulate. “Truth” is an Illusion

Recent Observations

External Benchmarks

Environmental Impacts

Zone of “Truth”

“I don’t know” can be a disarmingly powerful way to build credibility.

When Finance and Marketing collaborate on a well-defined learning agenda, growth-driving insights emerge.

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When Marketing Says…

“I’m seeing some data that suggests we might improve unit sales growth by moving some $ away from our Segment A digital

plan and into our Segment C loyalty program. Can you spare a

few minutes to review my simulation assumptions and make

sure I’m not missing anything important?”

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Finance Hears …

“Ok. No one is trying to sell me or convince me of

anything. They really do seem interested in learning

what really works.”

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“Marketing analytics create the illusion of control and certainty.

Cannabis has much the same effect.”

- Tim Ambler

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