We’ve all heard it said that opposites attract. This time-tested sentiment holds true in the C-Suite, where leaders balance roles between risk aversion and growth investment. Opposite perspectives are valuable to inform decision-making. But opposing priorities are deadly to team culture and corporate health.
The rubber often meets the road in the relationship between Marketing and Finance. Should the company invest in strategic, but often unpredictable (risky), marketing initiatives? Or should the business limit its spend to programs already proven to generate measurable results? What is the right ratio of risk vs. caution, reward vs. stability?
There is no one-size-fits-all answer, but the fact is: healthy growth requires leadership alignment, and alignment requires trust. In this recorded webinar presentation featuring a panel of business leaders, we discuss the power of a high-trust union between marketing and finance.
Key Takeaways
- Early investment in marketing builds brand awareness and credibility, leading to a stronger market presence over time.
- Establishing a shared language around metrics and performance indicators helps bridge the gap between quantitative finance perspectives and qualitative marketing insights.
- Engaging external expertise early can prevent the need for extensive cleanup and restructuring later on.
- Understanding marketing as a critical growth driver can foster better collaboration between finance and marketing teams, leading to more informed decision-making.
- Trust is essential for effective collaboration between the CFO and CMO, enabling both to align on long-term goals.
Links & Resources Mentioned
- AVL Growth Partners
- The power of the Authentic Mindshare™ and CMO peer community
- Marketing ROI: A Guide to The Big 3 Revenue Metrics
Webinar Transcription
Introduction and Webinar Overview
Jennifer Zick: And we’re off and rolling. Welcome everybody to the Authentic Growth™ webinar series. I’m your host, Jennifer Zick. Thrilled to be joined by three great panelists today who I will introduce shortly. But first, as we’re waiting for attendees to roll in, I’m watching the count as people are logging into the meeting. I just want to take a little bit of time to introduce you, if you’re a first time guest to this webinar series, to who Authentic® is as host and what it is that this series is all about. Authentic is a community of fractional CMOs (chief marketing officers). We work with growing businesses to help them Overcome Random Acts of Marketing® and confidently take the next right step toward healthy growth.
And so, in our series, Authentic Growth™, our goal is really to serve growing businesses, their leaders, their executives, owners, executive leadership team, and their revenue builders, sales and marketers with topics that are timely and actionable. Today’s topic, the relationship between finance and marketing, is going to be really fun. I promise that it’s going to give you a lot to take back to the office, especially if you, like us, are in the middle of your budgeting season and planning for next year. We hope to give you some conversational points that are going to help you move forward with clarity and alignment. We really appreciate having you here with us today. We are recording this session, so we will be following up with it in your inbox after the fact.
While we are moving through the conversation with our panelists today, I would invite you and encourage you to use the Q+A feature you’ll see at the bottom of the screen or wherever your controls are, a chat feature and a Q+A feature. You’re certainly welcome to drop a chat message if you want to just make a comment. But if you have a question that you’d like us to consider teeing up to the panelists at the end of the conversation, please put it in the Q+A. Both I and our moderator will be keeping tabs on the Q+A to make sure we do as much as we can to address your questions. So thanks again for joining us. So, without any further ado, I’m just delighted to introduce you to our panelists today.
The panel is made up of representatives from Authentic and also from our friends at AVL Growth partners. I’m going to start by asking JP to say hello and introduce himself, and then we’ll go to Chris and Peter and then jump right in. So good morning, JP.
JP Tremblay: Good morning. Thank you, Jennifer. I’m JP Tremblay. I am a fractional CFO with AVL Growth Partners, where I work with a number of companies. I’m mostly focusing on our tech practice. So most of the clients that I work with are SaaS business models. So help them through that stage of growth. So I’ll probably refer to that business model today in our discussion. Prior to that, I’ve sat on different sides of finance. I’ve been on the investor side as well, which hopefully provides some context. And I’ve also spent a stint as a teaching professor, which is always fun to talk to people. But why is this topic today so exciting and so important to me is because I feel like it’s the description of my marriage. I happen to be married to a CMO. So for us, this whole thing is basically pillow talk.
So hopefully today will be a little bit of couples therapy for me and I’ll probably learn some tricks on how to bridge those discussions. But it is a fascinating topic, all kidding aside, that we are tackling today. But hopefully we can find those commonalities and bring everybody together around the table. So I welcome the discussion. Thank you. Jennifer.
Jennifer Zick: Thanks JP. I might need to invite your spouse to our next webinar.
JP Tremblay: She might be watching. Sorry, honey.
Jennifer Zick: Awesome.
Chris Schwalbach: Thanks.
Jennifer Zick: And Chris, welcome.
Chris Schwalbach: Thank you. So I’m the founder of AVL. We’ve been around about 15 years, and so a lot of times I use the word CFO firm. You know, there’s a lot to distinguish from the CPA firm. So we’re a team of about 75 people or so, have been around a long time, and worked with 1000 plus companies over the years. And we have accountants, controllers and CFOs on our team. And we really work a lot with what we call high trajectory enterprises, high trajectory ventures. A lot of our client companies are venture backed or investor backed. And we really just like to find ourselves in very dynamic environments and where things are changing a lot for us, the conversation, and I think marketing is a great one, whereas there’s such a wide span of stuff happening in marketing all the time.
And the things that we learn in one quarter are obsolete very soon, or we’re always learning. And so that learning curve is so steep. And that’s where I think this partnership makes a lot of. It’s very important for those early stage companies. And for me, I love it just because in some ways I was a trained accountant, but in a lot of ways I’m an entrepreneur and like, I love the go to market stuff probably more than I love accounting. So I’m kind of like, as you know, closeted marketer in a lot of ways. And now as a, as the founder, I get to do that a lot more than I do the accounting. So it’s super fun for me.
Jennifer Zick: Thank you, Chris. We’re glad to have you here. And it’ll be fun to talk about how so many founders see themselves as marketers and how we partner with them to get those ideas into action. So, Peter, over to the marketing side of the house. Hello.
Peter Zaballos: Hello there. Thanks for including me today. And, yeah, I’m Peter Zaballos and I’m a fractional CMO with Authentic, and I’ve been working at Authentic for a little over a year now. But prior to that, I was the CMO of a unicorn technology company, Cumulo in Seattle, that made a software based file storage platform and had about a quarter of a billion dollars invested in it. So lots of expectations were high there. And then prior to that, I was a CMO at SPS commerce, which is a public company in Minneapolis. I was there for six years and built the marketing organization pretty much from scratch, and they make a cloud based supply chain platform for retailers.
And prior to that, I spent seven years helping to run a venture capital firm and then a bunch of other high growth tech startups and marketing roles. So I have, along the way, I have learned just how important it is as marketing’s role has changed and the technology that goes along with it has changed. One of the most important relationships a CMO can have is with the CFO, and we’re going to get into some really good discussion about why that’s so important.
Finance and Marketing Team Relationships
Jennifer Zick: Absolutely. All right, well, let’s get the discussion rolling. And once again, I just want to invite our audience to participate by putting some questions into the Q+A as we move along, and we’ll be sure to keep an eye on that and create some time at the end to address some audience questions. But I’m going to get the ball rolling with a question, and I’d like to direct it first at you, Chris. Let’s start with some of the pain points. We’re going to get to a good resolution by the end of this meeting. I know, but let’s start with some truth. What are some of the biggest frustrations that finance leaders have with marketing? Where have you seen the most friction or I, or lack of alignment in that relationship?
Chris Schwalbach: Yeah, I think that for me, I think the thing that’s most common that I see across the companies that we worked with, I think is it’s funny to talk to Peter about this when we had a pre call because he’s so data driven and it’s just so juicy to hear. There’s so often that we run into with them. Everything is necessary. There’s a lot of things that are necessary. We got to be there. Why are we doing this? We have to be there. We have to do this. We have to do this. There’s a little bit of a pay to play mentality, a lot of cases and it’s so hard to kind of pull that apart. The other one for me that I think we love to do as CFO’s is we love to run experiments. Like how do we know this is working?
Like how we run experiments to check on pricing, to check on channels, to check on various things. And it doesn’t mean that’s not, I’m not trying to indicate that let’s do random acts of stuff, but it’s how do we purposely test certain things? And combined with that is like resource allocation. So there’s cruise control where we’re like, hey, we’re doing this. In accounting. We call that SALY. It’s the same as last year, which is the same as last year with very little resource reallocation. And what we really like to look at is how we are proving our allocations are really done in the right way and that we’re pushing capital and pushing the envelope on how we’re distributing capital.
And then I think it’s like the last one I would just say is people that give up on attribution too early and just saying what is this really driving? And it’s like, I can’t. It’s too hard. You can’t point it out. There’s not a direct line. And it’s like, hey, I get that. We respect that there is an 80 20 or there’s something in there that we’ve got to start to draw something. And I think they create and I think this is where the CFO can, their experience can lean in to say how do we get there? You know, what are the things that we can do?
And I think that’s where the relationship can bloom a lot more when we dig in there with the CMOs in terms of how we create this attribution line, whether it’s pure or whether it’s a little cloudy, but we kind of make these agreements on what happens. But that’s kind of where I think the four things that I see are just like the most common things I revolve around.
Jennifer Zick: That’s a really thorough and thoughtful answer, Chris. And it is making me reflect a little on all the conversations I had with my finance leaders about B2B professional services not being a straight line, which is both true, but also not an excuse. Right. So, Peter, I’d like to flip that same coin over to you and ask, what do you think marketers find the most frustrating in their relationship with finance leaders? And I have a secondary part to this question, because you and I know in working with the small businesses we work with, almost all of them have on their leadership team a finance leader and an Ops leader and a sales leader. But a lot of growing businesses haven’t put a marketing leadership role on their leadership team yet. So how does that impact the dynamic between finance and marketing?
Peter Zaballos: Well, I’ll sort of build off of what Chris was saying. I think in the last 15 years, and for sure in the last ten, marketing has become a discipline that is 100% data driven. Like there isn’t a single thing you should be doing in marketing where you don’t know how to measure the outcome and you don’t know how to measure the performance. And the flip side of that is, if you are doing something where you can’t measure that, contain it, examine it and scrutinize it so that you can figure out what was the benefit of that. But otherwise, marketing is a 100% data wonks dream. Everything can be measured now and it should be measured. So the biggest frustration I have had early in my marketing journey was with finance organizations that didn’t take the time to understand what we’re actually doing.
I have lost count of the number of very productive conversations I’ve had with people in other parts of the organization about how search marketing works. Like search marketing is the bedrock of everything we do now. It’s super technical. I used to use an analogy. I wrote a blog post about this a few years ago. Marketing is a lot like building a software product. You can’t build a software product overnight. It takes months of development. You need a system architecture for marketing. You need a brand framework and a go to market plan. But it takes months to get results, to consistently perform from a marketing campaign in the same way it takes months to build a product. But a lot of people that populate other parts of the company don’t necessarily understand that, and they look at marketing as just a transactional department.
And with finance it can be, here’s your budget. I know that you want more, but you can’t have it. But if you reduce that relationship down to transactions, everybody’s going to lose and the marketing organization is not going to be able to live up to its potential. And then to your second point, Jennifer, it’s related to this. If you’ve got a head of sales responsible for marketing, they may understand how Salesforce works, but they don’t understand how a marketing CRM platform works and why it’s important and why marketing operations is a critical part of the go to market motion.
So because marketing has changed so much and gotten so technical in the last ten to 15 years, I’d say the biggest issue, whether you’ve got a leader jointly responsible for marketing or a CFO, is not taking the time and not having the curiosity to understand how does marketing work today and then how do you invest in it and understand the return on that investment.
Marketing Leadership in Growing Businesses
Jennifer Zick: Absolutely. Well, and I think one of the critical pieces of what you’ve both just described there in terms of marketing and the relationship, not feeling transactional but accountable, is that there has to actually be a relationship and there has to be communication. So JP, over to your corner. What have you seen that sets the tone for productive dialogue between marketing and finance leaders? And does that usually happen in the setting of a full management team meeting or is that best done in one on ones? What have you seen work?
JP Tremblay: Appreciate the question. It’s a good question. So I’ll tell you maybe what does not set the tone for a good discussion is when somebody comes to the finance department, to me and says how much can I spend? I’m a marketing guy, how much can I spend? And it’s probably the worst question to ask because the answer is both nothing and all you want, right. It just depends on the return on that investment. Right. So I think it’s really, to be honest, kind of that realigning. What is the objective here? Right?
So I’d like to approach things from what I would call an hourglass approach, where from a top down perspective and a bottom up from a top down perspective is usually when you meet with the senior management, the CEO, and usually educated by board discussion that says, let’s for example said our goal is to, we think we can double revenue next year, right? So we think we looked at our TAM, Samsung, all that stuff, you’ve done all the analysis and think we can get there and that’s kind of our north star and that’s good.
So you take that, you’re like, okay, this is now my target from a financial standpoint with of course associated metrics, from a hopefully cost analysis, then where the discussion becomes productive is when you involve with the marketing organization people who actually do the work and say, how do you support that? Which activities are required to, which activities and resources are required for us to get to that point? And is it possible at all? Right, so for me, these two come together, and then from there, you’re able to size up. I mean, is this the size of a bread box or is it bigger than a bread box? Right. So how much is our current budget? Enough like Bau? Is it good enough to get us there?
Or do we have to consider a much higher investment in that revenue engine that I call, right, to get us to the goal? So I think for me, everybody has to be aligned and somehow we can hopefully all agree that there is, as a company, there is a goal. We are usually achieving growth from a top line perspective and hopefully generating some form of earnings. I’m an old school cash flow guy, so I certainly like to do that in a profitable fashion. And I think, well, not everybody is like Peter with those metrics, but oftentimes we have to spend a lot of time translating that into, okay, how do we measure these things?
How do we measure how much we need to go in the funnel on top in order to get sales closed-won at the end and get us to where we need to be? And I think those discussions, I think everybody around the table is bridging that gap, maybe, that we’re discussing today. If everybody was like Peter, we wouldn’t be here today, I believe.
Jennifer Zick: Thanks. I agree with that statement. And there were two things that you just described, JP, that I want to call out that I especially appreciate as a marketer. First, you talked about setting a North Star goal, a North Star growth goal in our authentic growth methodology. That’s actually at the very top of the frameworks that we work with to help clients build out their marketing plan. Right. Because unless all of the departmental leaders and the company agree on what that North Star is, what are we aiming for? We can’t even provide the inputs that are going to help us get there. The second thing that I love about what you explained is that then we ask the marketing organization, is it even possible? Right.
Because I can’t tell you how many times we’ve been in positions as marketers where the business leaders have set goals without asking for the inputs and just expect magic to happen. So I appreciate that you’re acknowledging the give and take of how we get consensus as an organization. Anybody else have a thought on that particular topic?
Peter Zaballos: I just think that it needs to be a function of a sincere appreciation of how you develop this relationship. What does this person need to get their job done? And how do you help? How do you understand that you’re not going to get them to understand marketing’s job if you’re not willing to understand finance’s job?
Chris Schwalbach: Yeah, I was just thinking about the same thing, which was like, I think about enterprise value, and like, the CFO is focused on enterprise value, and so understanding how to convey the why in the marketing, not just the what, but the why, is so powerful.
Budget Negotiation and Decision Making
Jennifer Zick: Absolutely. All right. Well, Peter, this one’s coming back to you. You’ve been a marketing executive for a long time, and you’ve had a lot of conversations along the way about decisions on marketing budgets, ROI and expectations. Right. In terms of pace and what they can expect to see and when. How have you set the tone for budget negotiation and decision making? And what tips would you offer to your marketing colleagues?
Peter Zaballos: I would say it’s the same playbook that you should be using as a marketing person with sales. Like, if you really want to understand how to be an effective partner to sales, you have got to know the salespeople, and you have to know the SDRs, you have to know the sales operations person and understand what their jobs are like, what they need. Same thing with finance. The very first person I tend to develop a relationship with in a new organization in finance is the accounts payable person that tends to be the person in the organization that you are afraid of and you would never want to be on the bad side of. But they’re also going to be the one who’s going to make sure that whatever you’re buying, whatever vendor you’re working with is taken care of. But spending time with the CFO.
Reference back to something we said earlier. Any marketing organization is planning three and four quarters out because the campaigns that start today won’t start yielding predictable results for a couple of quarters. So you’re already thinking in the timeframe that the CFO is spending all their time thinking. So getting to know the CFO and understanding the whole budgeting process, when it starts off, how it’s done, who leads it, and if it’s a decent sized organization, they have somebody in FP & A financial planning and analysis, and both the last companies I was CMO at, I had a dedicated person, an FP & A, and they reviewed my spending by quarter. We sat down every month, but we did a deep review every quarter. We did our planning for two years. And that’s because I’m spending a lot of money.
CMOs are spending as much money as CTOs now and more money than heads of sales on technology. So you really have to invest the time to understand how the CFO is charting the financial plan for the company? How do you help support that on a day to day basis? How are you supporting the FP? And a person whose job is to make sure that the budget lands where it is supposed to every quarter and then accounts payable. And I can also tell you that at both Cumulo and SPS Commerce, I had a meeting every quarter with the CFO. And they would walk in and push a piece of paper across the table that had a list of every subscription my department had signed up for. And it grew every quarter. And every quarter they would just grill me on, do we need this?
What is this? What is it used for? Because anybody can sign up for a $200 a month subscription in most organizations. So it’s also understanding, like, if they don’t understand how your marketing campaigns work and the technologies and tools you need to use to construct them and instrument them and measure them for performance. Going back to the transactional nature, those conversations about subscription services get really ugly because they don’t understand why you’re spending the money. All they see is your subscription budget is growing. So I think it all comes down to, you have got to be committed to a sincere and trusted relationship with these people and understand that you’re operating on a planning horizon very consistent with the CFO’s and not. You’re being held accountable on a quarterly basis. But you gotta be thinking about the long term with the CFO.
Jennifer Zick: Absolutely. So, CFO friends, do you have any kind of thoughts on what Peter was sharing there?
Chris Schwalbach: Yeah, an hour’s worth. You know, I think one of the things I was, I can’t remember the words you just used, Peter, but it was just, you know, when you get grilled, I think a little bit is, there’s a. I, again, this may be more personal, but it’s like, there’s a little bit of, like, the hammer finds the nail right in marketing. And so if you have a marketing team that has a specific expertise, I think the CFO is also saying, are you exploring all the things? What do you think about it? What’s going on? Are we just hammering this with this, you know, solving it with this hammer? Because we don’t know how to do anything else or this is the way we’re doing it.
And so it’s a little bit scratching that itch for the CFO to say, how are we thinking about this? And I think that’s an important thing. You know, when we get back to the kind of your previous question, we get back to the relationship is, can the CFO almost explain the marketing strategy? Can they? Can they really? If you handed the microphone over, are you teaching them a little bit more of the whys? This is kind of my comment, and I think the final thing with my comment on the budget, which is if the CFO is only looking at anything that begins with a dollar sign in terms of a budgeting conversation, that is not. It’s not going to be effective. Right. It’s got to be, what are the other operational activity metrics? What are all the.
Chris Schwalbach: Peter, you were saying long term. I was actually thinking short term too, like, you gotta have that short term horizon in terms of what are the activities that lead up to this budget, and then kind of the longer term horizon in terms of where we’re going as a company. So I tend to look at, hey, what are you committing to from a non financial perspective of this budget that leads to that financial outcome as well?
JP Tremblay: And I’d like to maybe supplement that, if I may, about going back to being, aligning those objectives. Right. So if you go into a budget discussion not having been provided, what you’re trying to solve for, that’s again a bad footing, a bad place to start that discussion, right. So as opposed to saying, okay, this is what we’re aiming to do and this is how we’re going to get there, and the resources, again, required to support those activities. And maybe on the CFO side, I believe what Chris was saying, which is very true, is if you know the subject matter, right.
For me and some of the smaller organizations that I work with, the marketing department may not have the quantitative expertise required to do the modeling, the quantitative analysis and the modeling of those metrics and KPIs that are so important in measuring efficiency of our marketing spend. So I end up running on my sleeves and building those models. So I understand we speak the same language, we have a common language to say, okay, I do understand what our close rate is, and I do understand we’re trying to minimize our client acquisition cost and all of this. So we are now sharing the levers that allow us to influence what we’re trying to solve for a company, right? So we’re trying to get there. We’re trying to maximize the LTV to CAC ratio.
We can throw all sorts of acronyms today, but in the end, there’s a few things that we can drive as a leadership organization together to say, okay, in order to affect this is what we need to pull over here. And I think all of that together helps us make decisions. And look, I think in a critical way, not saying, okay, hey, this is a pretty high expense. We’re going to Vegas for this massive conference and we don’t know the return on that spend. That’s kind of, again, maybe a less productive way to start the discussion. Right?
Peter Zaballos: Versus can I do just one thing for this, I forgot to mention, marketing exists only to hit the revenue plan. The other reason you need to have the CFO partnership is the CFO needs to know where going to hit the revenue plan. And if you’re a public company, that’s super important. When I was at SPS Commerce, we introduced a whole new channel of demand through search marketing that closed super quickly and grew fast. They’ve never done that before. I spent a year with the CFO talking to her about when do we model this into your forecast? And with the head of sales to say, if marketing says they can create this much demand, I will believe it and sign up for that number. But we’re only here to hit the revenue forecast.
And the CFO, that’s one of their big jobs is knowing are we going to hit the revenue forecast.
Metrics that Demonstrate Marketing’s Impact
Jennifer Zick: Absolutely. Well, and the conversation about the data and speaking the same data language is a perfect tip for my next question, which I’m going to send over to Chris as a starting point. So Chris, in my experience, finance leaders are most interested in facts and quantitative data. They want to understand the ROI on marketing spend. They want to know the timeline for expected outcomes. All of that’s critical for this business modeling we’re talking about. But what metrics and KPIs specifically do you think are most helpful for a CFO that demonstrates marketing’s impact on growth?
Chris Schwalbach: Yeah, you know, it’s a very, you know, it’s a very tricky one because I think in the way that I tend to think about this a little bit more is in the specific metric is to say, do you have metrics that cross different time horizons? In the way that I think about this is that, you know, kind of a little bit alluding to what I was saying earlier is like even on a weekly basis or on a very short term basis, there’s very, you know, there’s some very strong activity metrics that are saying what are we actually, what are the actions? What’s the production from marketing? What are we actually getting out the door? Whether, you know, let’s just call it even, you know, content pieces, if it’s a content marketing strategy or like what’s being produced?
And so there’s an activity level that kind of ladders up, right? And so how do we connect that to maybe more of an outcome measure and whether that is leads or conversations, etc. So I think this is, to me, I like to connect this non financial activity and kind of those kinds of pieces to the financial piece a lot more. And so I, and then I have a separate kind of view on the monthly and then be able to really dive deeper with my CMOs on a quarterly basis. To say, really having a conversation about what we learn? And drill down into a quarterly is like, what are we learning? And I think, Peter, right before this, you were talking about, it was a great example at SPS because really what you’re saying is I want to run this experiment.
Give me a leash. Let’s define the leash and let’s re-allocate capital. And to me as a CFO, I’d be like, yes, we’re going to try something and I want to try this. And this is how I’m setting up the experiment. This is how I want to run it. And then the leash gets essentially longer because you’re basically proving the thesis. And that to me is like, great, so what are we looking at in the short term? And then we can kind of like, okay, we’re actually producing some activity in this experiment that helps us learn. We’ve been working, and we’re working with one of our clients. We came in there and said, what if we doubled the price? What if we doubled your price? What would happen? They’re like, we have no idea. And we doubled the price and their demand increased.
And they’re like, how’d you know to do that? We’re like, we’re not. We’re running experiments. We don’t even know what your curve is. And it’s such a valuable product. And they’re like, okay, you just paid for yourself for the year in a month. That was nice. And so those are kinds of like, why aren’t we trying this? We had a client that had 100 products on their website. We said, what if you only put twelve products on your website rather than 100? What happens here? And they’re like, well, we never thought about that. So just like, how can we run these experiments? Reallocate capital. And that’s what I like. To me, those experiments are almost more valuable in marketing than some of the KPIs that get us kind of in a little bit of a rut.
Jennifer Zick: I want to speak into our springboard off of something that you said there, Chris, because I want to acknowledge that a lot of our listeners are small, entrepreneurial, growth businesses. At Authentic, we work primarily with businesses between five and 100 million in annual revenue. So I expect some of them are at this meeting right now, listening in. And many of these companies have been founder led, perhaps sales driven, if they’re doing marketing at all. It’s been what we would call random acts of marketing. Very reactive, maybe not even with a marketing budget, but just like opportunistic. Okay, we’ll throw some dollars in. And when you’re starting from that position and we’re talking about data and insights and measurements, we’ve been writing recently a lot about data and analytics.
And I want to acknowledge that for a company that’s just starting the strategic marketing motor, you really do have to give yourself some grace to make some commitments, measure the level of activity and output which will create the engagement data that eventually will lead to a baseline of history that gives you insights. You have to have activity before you have insights. And there’s a timeline needed to even establish a baseline that I think a lot of businesses haven’t maybe really understood. A lot of conversations with the businesses we talk with. It’s almost like this assumption that we’re going to start marketing, put dollars into marketing and some kind of lead faucet turns on. But those of us in marketing know that’s not the case. So I think I just wanted to validate that.
There are some valid metrics around production too, that get you to establish baselines.
Chris Schwalbach: Yeah, I mean, I just call it the finance world. We call it start creating game film. You have to have game film, right. You have to have a lot of game film. And so you’re going to have a lot of bad game films to review and you’re going to have some great game films to review. But if you don’t have any game film, it’s hard to. It’s hard to uplevel, right? It’s hard to make the next change. And so the mantra is create the game film.
Fractional Executive Advisory
Jennifer Zick: And I like that. Yeah, I like that. Well, moving along, back to you, JP. Obviously, AVL and Authentic are both in the business of executive advisory with growth businesses on a fractional basis. That means we’re brought into growing organizations at a time when they often recognize they need some help on, they need some leadership they don’t currently have in house. So from your perspective, when is the right time for a business to bring in that kind of outside help. And how can that kind of guidance cultivate alignment in these two roles? And specifically from your side, they’re bringing you in on the finance side. How does that help growth businesses aligned?
JP Tremblay: I guess the easy answer is it’s never too early to do the right thing. Right. In my portfolio of clients, I have companies anywhere from pre revenue all the way to IPo ready. Right. So the entire gamut. And they need different things from our engagement at different stages. But if you focus on the earlier stage companies, it’s probably easier. And what I see people coming to is like, we want to set this business up with best practices, with this gold standard, right? So it is really what they want. They know they’re going to be successful, they have the right people, the right idea, the right capital, and they just want to make sure that they are setting things right from the start.
I would say in that sense, there’s never a too early situation here because it’s sometimes harder to, if we are brought in maybe at a later stage where things have been done, maybe not the best way for a while, then you have to do a lot of cleanup and undoing, and it’s not necessarily productive work. So I think bringing in the right people around the table at an earlier stage allows those decisions to be made with the right metrics, with the right perspective, professional perspective. I mean, that’s what you’re doing when you bring people like AVL and Authentic in. You are people with a tremendous amount of experience in your organization at a stage that you could not afford on your own, just looking at your size.
And I can even reinforce that by saying, the people I work with, a number of companies, and I solve a lot of different problems that I bring to the table with every one of my clients. So I leverage all of that. But more than that, inside of our organization, I have peers. So together we have hundreds of companies and thousands of hundreds of years of experience that I can leverage and really help bring to my clients situation here. So it is a lot more rich from a professional contribution than just saying, okay, I’m going to wait until I’m ready. I have the money to hire the next key person. And what is that next key person we just talked about? Is it a CFO? Is it a CMO? Is it a CRO, is it a COO?
Which one is the next key hire? So I think I’m a big, of course, a big believer in the fractional business model and having the ability to bring the people in whatever scope is necessary at the time to solve and make the best decision possible. Because I mean, we all know that small businesses can’t afford too many mistakes, right? And that’s why we have to be nimble. Chris was just talking about the experiments, right? You need to experiment things and fail fast, fail cheap, and we need to iterate very fast into that. And the world is changing. So having professionals that are allowed this dynamic kind of ecosystem inside the company is really rich from that standpoint.
Jennifer Zick: Yeah. One of the things I really appreciate about our relationship with AVL is that your model is so similar to ours at Authentic. We also have that peer cohort collaboration which we call our Mindshare. So Peter, what have you seen in terms of the right time to bring marketing leadership into a growing business and how that helps to create the alignment between marketing and finance?
Peter Zaballos: I think it’s precisely when you are wondering how you are going to grow sales and the tools you’re using now have stopped working or have hit a limit. And that generally happens when you’re describing a founder is doing a whole lot and the founder tends to do the marketing, but for the reasons we’re talking about before, marketing is so technical now. And to get the leverage out of marketing, you have to invest early and build over time. Eventually the reactive toolkit is going to run out of gas and then you need to bring somebody in who can say, okay, what part of the search landscape do we need to own and what is our performance there now? What’s our strategy to go after content in this landscape and start building rankings on it?
One of the things that comes as a surprise to a lot of founders and some CFOs is that better organic search performance gives you lower paid search rates. Google rewards good search performance for things like your organic content, the content that you’re just producing and people are finding, the better you are at that, the lower you pay for ads. So this is a six to 18 month planning horizon that needs to be put in place and staffed and instrumented. So I would say you can’t really do it too early. Actually, I just started an engagement with a client with Authentic who is a company of two and a half people and that’s one full time person and a bunch of half people. And there is no marketing going on. But They’ve got a really big ambitious business they’re going to build and they understand we have to start early if we’re going to have the commanding role in the marketplace we want to have. So yeah, I would say sooner rather than later, and then give it time, because it takes time to get the results.
Jennifer Zick: Absolutely. As the other marketer in the room, I’m going to double down on that and say I had the advantage when I found an authentic brand of knowing the ramp up that it takes to create a validity in the search world with content. And so my first commitment, even as a founder without a marketing team, was to create great content and keep creating great content because it’s going to take two or three years before we’re organically showing up with that content. And I’ll tell you what. Exactly two and a half years into that rigor, we started to see inbound being a third of our lead generation, all based on content. So it takes time, and it’s an effort. But I just wanted to double stamp on that, Peter, because we feel it and we’re living it here.
Chris Schwalbach: Well, I’ll go out and say, Jennifer, that I’d say marketing precedes finance all day long. I think you can muddle your accounting way for a while, because I think the most important thing is, does your product really work? Does it sell? And do you know the market? Do you know your customer? You got to get that. That’s your one or zero. That’s a binary kind of thing. You start getting that working, you can get your bills paid. You can run payroll on the cheap. Now, when you kind of are moving out there and you’re kind of getting to that second or third step in the staircase, you got to say, all right, you can’t be putting all your finance things in one bucket and not know anything about channels or types of customers or types of products.
Then you start to say, okay, we need to get a little bit more sophisticated. And then finance has to recalibrate and catch up to where the business needs to go. But I’d say, man, you gotta, the marketing has got to hit, be hit early. And so a lot of times we’ll say, use the analogy. Like, Avl is an F-250 pickup. Like, we want to haul stuff. We want to be able to carry up the mountain a large load. And it’s like sometimes these businesses aren’t quite there yet in terms of their finance and accounting and saying, hey, you’re doing great. Things are on the, you’re on a good, you’re on an okay path. You’re not going to break anything. But as soon as you start asking these types of questions, then it’s time for us to start jumping on board.
But I think you’re not going to even ask those types of questions until you have marketing starting to ask those questions. Right. Or need that information from the finance team.
Ideal Changes in Marketing-Finance Dynamic
Jennifer Zick: Absolutely. Absolutely. Any other comments before I bounce us to the next and final question? And I want to make sure I leave time. We’ve got one audience question. I just want to say, I see you. We will address that question, but I want to invite our audience to add any other questions. If we’ve got time, we’d like to make sure that we’re addressing what’s on your mind. But over to our friends on the finance side, Chris and JP. If you had a magic wand and you could change just one thing about the dynamic about marketing’s view or the dynamics between marketing and finance, if you could change one thing about marketing, what would it be?
JP Tremblay: That’s a very dangerous question, and I’m on the spot here. It’s actually my, maybe my marriage is on the line here, but, I, I mean, I, I would say maybe let’s, I’ve said it. Peter talked about all the beautiful quantitative work that’s being done, in the, in the marketing world, but it’s unfortunately not the same everywhere. And sometimes the first marketing hire is maybe a content creator or more of a creative type, and maybe the quantitative skills are not there. So I’ll put it simply and say maybe marketers need to learn a little bit of excel, and I’m not going to learn Photoshop, I promise. So I’ll stay out of your way.
But I think maybe going back to some things I said earlier, which would be as long as we align on that North Star or those goals, I think marketing and finance are really attached to the hip. I mean, I always see myself as a service organization. Finance doesn’t want to be the tail that wags the dog. We are there maintaining the engine room, but we’re not the one feeling it, putting the gas in. So, marketing is, that’s the way I define our role, and we really want to work hand in hand. So for me, as long as we build that common language, I think we can move together and achieve those great goals. That’s kind of my, a quick, you know, quip about.
Jennifer Zick: That’s your one magic wand. Perfect. Chris, what about you?
Chris Schwalbach: Yeah, I was thinking more of the psychology of, you know, accounting. Basically, we have a gap, we have a big giant book that tells us there’s one way to do things. And so, you know, what we would want is like, there’s only one way to do marketing in the sense of, like, marketing is just so broad in such a wide way to attack. And so it’s like, that is a pain in the ass for us. I mean, we just like, can you just do it one way and just have that be the right way? And, you know, I think that would be like the silver bullet for our brains in a lot of ways. I mean, it takes away the amazing creativity that happens in marketing.
But I would say that, you know, so, and actually, there’s a lot that I could say I’d glean from what Peter was talking about today, which is like, there is a. And I think I’m speaking a little personally about AVL, too. Like we had, you know, we have this great opportunity where a lot of clients are coming to us. We’ve created something. We do good work, but in some ways where we want to go as a company. If we don’t plant the seeds now for something that’s going to grow from a marketing perspective and build skill and expertise, even though we don’t necessarily use all the tools of marketing in our earlier years, that will stunt our opportunities in the later years.
Because I think that’s when you start to say we really have to have strong, a larger reach, a bigger presence than were, an outsized presence relative to who we are to achieve the long term stuff. So I think that kind of, that belief in the foundation setting, I think is probably the hardest thing for CFO’s probably to fully grasp. And I think that would be the one piece I would say is, how do we believe that the foundation for the long haul is crystal clear to the CFO World.
Jennifer Zick: That’s beautiful. I feel like that’s a whole other webinar in the making. But Peter, I want to make sure I have time to ask you the dangerous question, too. If you could wave that magic wand and change one thing about finance, what would it be?
Peter Zaballos: I think it would be to look at marketing in the same way you look at your technology department and product development department, instead of looking at it like it’s like sales. Because if you’re a CTO, you’re making multimillion dollar investments that don’t pay off in the year you make them. And you have to be looking two and three years out about the kind of business benefit you’re going to get from the products you start building now. And in both my last two roles, I borrowed the agile coach from the CTO because the whole marketing department ran on agile. And the same thing about six print plans: three months, six months, nine months, twelve months, release horizons for all of our campaigns.
And I think if CFOs looked at marketing more like the animal that technology product development is, I think that would go a long way towards getting us all on the same page.
Jennifer Zick: I like that, Peter. I love that too. And I’m going to ask you to share that analogy with our entire CMO team because I think it’ll help reframe a lot of expectation conversations with our clients on what it is that we’re doing. I’ve often tried to help clients understand that when you’ve got a growth goal, and many of our clients use an operating system like the entrepreneurial operating system eos to plan their business vision. So they’ve already articulated their one year, their three year, their ten year kind of vision for growth. I am often encouraging them to think about investing in marketing as if they were two years ahead, already in their revenues, and think about the marketing investment that way. Because if you’re driving growth, we know that the outcomes, the fruit of that, is coming downstream.
SEO Effectiveness and Final Thoughts
Jennifer Zick: So, oh boy, we could kick off a whole nother webinar right from where we just landed. But I want to make sure that we stay on time. And I promised my one brave audience member that we would address this question. So I want to tee it up. Peter, it’s addressed to you. Peter, in your opinion, how has SEO and its effectiveness changed, particularly as it relates to the upfront investment, before ROI becomes measurable?
Peter Zaballos: Yeah, this is the key question. So I’ll answer it two ways. One, one of the very few things that Google does good in the world is interpret page intent. And they made this change about eight years ago. And Google will now evaluate the quality of that page because it will understand. Is that page an awareness oriented page? Is that educating somebody about a problem? Is that page a consideration piece of content? Is that educating that visitor about what are potential solutions to that problem? And then if that page is a conversion page, they’re going to look at it and measure the effectiveness of taking somebody who knows they want to buy and then having them submit a form or commit or convert, and they can look at the paths everyone takes.
So if you don’t sincerely address the concerns of the visitor with appropriate content at the appropriate stage, you will suffer and they will penalize, they’ll rank you down. So it all begins with the easy part is Google’s made it really easy for you to create content that performs well. And they will tell you if it’s doing that. The hard part about the ROI is it’s going to whatever business you’re starting. You’re going into some segment where somebody’s already been there and you’re trying to carve out a new category there. So you’re going to go into a search landscape where somebody else is already ranking in the top ten. And because it takes time to improve that, you have to look at your ROI as human capital spread over time.
And you can move your rankings in a month, but you’re going to move them from ranking on the 8th page to maybe the 7th page. But unless you start that journey now, you’ll never get to the first page. So I would say the good news is SEO has never been a more important tool. It’s effective. It takes a long time to get the results you ultimately want, but you can measure the return on your investment every month and your investments are going to be somebody writing content. And ideally you have a search engineer with you who is doing all of the guidance and measuring the effectiveness of your search performance of that content.
Those two heads, and you could make those fractional people, you could get those from an agency, but those two heads are your investment, and you can measure your return on how much of your content is moving up the rankings every month.
Jennifer Zick: Awesome. Thank you, Peter. Well, gentlemen, does anybody have a final thought you’d like to share before we move to wrap today’s event? I sprung this on you. Go ahead, Chris.
Chris Schwalbach: Well, you know, I think there’s. It’s just reflecting a little bit on, you know, the CTO and the systems piece, you know, and we’ve spanned all the way to sophisticated systems from this founder, you know, founder, two and a half people, you know, and there’s probably. There’s a number of interesting stages there. And I think the answers. There’s probably a number of answers here that may resonate with certain listeners differently than other listeners, depending on that stage. And. But I think they all come back to the same thing, which we’ve always said is just plant the seed early.
And I think it’s that ROI piece is like, how do you get the CFO’s to kind of say there’s an inherent belief, there’s trust between the CFO and the CMO of saying we’re planting this seed and we’re being diligent about it, we’re going to put stuff in place, but we know there’s some long term directional, I guess I would call it that religion. We’re believing in this in some ways, but we’re also going to measure. But it’s not all just going to sit out there and reproduce in the next 30 days, right? And so how do you. And I think that’s the common thing that spans all these conversations across stage.
Jennifer Zick: Absolutely. Well, we are going to put a bow on this wonderful conversation, though. It has gotten me thinking about a few other spiral off topics we might want to address in a future authentic growth webinar. But before all of our attendees take off to their next meetings, I want to ask for some feedback on today’s event. And we’ve got a quick little live poll that we would love for you to share some real time feedback with us. Once you’ve done that, I just want to say thank you so much for joining us here today. And I want to invite you to reach out to authentic brand if you’ve got questions about marketing and defining your market fit and focus and growth plan, and also AVL growth partners on the finance side all the way through the full stack of finance capabilities.
They are working with companies at all stages of growth. We’ve seen their work with some of our clients and definitely trust them as a partner in our ecosystem. So Chris and JP, thank you so much for joining us as our guest today. Peter, as always, thank you for representing our CMO team and attendees. Thank you so much for your time and attention, and we hope that you’ve taken at least one or two valuable nuggets with you today. So until next time, go forth. Be a blessing, be blessed, shine your light. We’ll see you again. Take care.
Interested in learning more about marketing ROI and revenue metrics? Check out this guide!
