What needs to change in marketing today? Episode 5: Kevin Moriarty
What needs to change in marketing according to the C-suite? Kevin Moriarty, CFO at JDA Software, thinks companies need to balance the short term payback and long term revenue. Kevin also highlights the challenge about the gap between CMOs and CFOs.
#Tip 1 Short term payback or long term revenue?
What I see right now is that no one is pausing to see what the true economic benefit different activities are deriving for the organization. Over the last 20 years companies have been trained more and more to seek investments and then clearly demonstrate what’s the payback or the returns the organisation’s going to receive. That’s the next critical step for marketing, being able to go out and demonstrate the value that they’re creating for the organization. The biggest challenge today the assumption that short-term paybacks are obviously the best. Everything cannot just be for the longer term as you look at your own investments as a marketer, you really have to bifurcate it to what’s near term benefit for growth and then what’s longer-term for the betterment of the organization.
#Tip 2 What’s the biggest gap between CMOs and CFOs?
What I see is that the ownership or command of the investments or the campaign’s that companies are running and new initiatives that they’re seeking to fund and then correlating that to true income statement return. Really balancing out in terms of true proof through measurement and analytics that investment that they’re receiving is generating revenue, earnings and cash flow for the enterprise. If they’re gonna continue to get the funding, they need to be held accountable to demonstrate the value.
#Tip 3 What’s your best tip to CFOs?
I think it would be great to get into a dialogue with the head of marketing to align in terms of what measurements of proof points should be used. Because there’s a lot of data, a lot of information that may justify a belief that we’re creating value but we’re not creating a return on investment, and I think it’s alignment on those very narrow metrics on what generates that value and return for an organization.
When I look at our business it’s really important to understand what the critical metrics are that drive the business. You can get lost, you can get inertia from looking at all these different data points because there’s just a proliferation of data and elements that you can study. But as a leader of an organization you need to understand what are the true critical few that drive a business and that’s really what I focus my time on and then seek alignment across the organization.