A strong partnership between Finance and Marketing can mean the difference between status quo and explosive business growth. So how can the two competing groups get on the same page? Maybe by taking a long strange trip together.
Brian Halligan, CEO and Co-Founder of HubSpot, joined us at our CFO Technology Conference to discuss the history and metrics that finance and marketing can use together to drive meaningful growth in their own companies. Interviewed by Michael Bayer, Conference Chair and CFO, HealthWyse, Brian chatted about technologies that have revolutionized marketing, what CFOs should know about new marketing challenges, and what the Grateful Dead can teach us about generating demand.Check out all of the tweets from The 2014 CFO Technology Conference here!
So what did we learn?
Online Marketing Has Gone Through A Major Revolution
Michael Bayer, Conference Chair and CFO,
HealthWyse, and Brian Halligan, CEO and
Marketing has undergone a not-so-quiet evolution over the past 20 years. The way we shop for and buy products has changed dramatically, meaning that companies have had to keep pace with new shopping habits. Further, the explosion of social media over the past 5-10 years has given customers a direct line to our internal business units, transforming our responsiveness and understanding of our customers along the way.
Successful organizations have kept pace with this shift in buying habits by turning their outbound marketing programs into inbound ones. This means that the days of spamming your potential customers with purchased email lists or advertising is gone. After all, your customers are more adept than ever at tuning that noise out.
Rather, inbound marketing focuses on the creation of great content – blogs, videos, articles, and the like – which attract potential customers on ideas and solutions instead of product. As Halligan put it “Would you rather rent someone else’s asset, or create one of your own?”
The Revolution Means Better Metrics – Seriously.
|Brian Halligan, HubSpot|
This revolution has not only changed what your marketing team produces, but also who produces it and how they invest your dollars. Let’s face it – the days of the ad man are long gone.
On the who and how of this new marketing, Halligan advised attendees to look within your own teams for this new content creation, rather than investing in outside firms. Look beyond sales and marketing to other business units for the untapped talent that could become a strong voice and presence for your company. Further, dedicate your marketing dollars to staffing instead of other assets – look for those key talents who have a strong history of content creation and an understanding of this new marketing approach.
The shift to inbound marketing has also brought with it better mechanisms to track your investment. And quite frankly, your marketing teams are dying to get on the same page as you. Halligan advised attendees to concentrate on the following metrics for marketing success:
Michael Bayer, Chair, 2014 CFO Technology Conference, and CFO, HealthWyse
Cost of Customer Acquisition (CAC): How much money did you have to spend to get this customer?
- Total Lifetime Revenue or Customer Lifetime Value (CLV): How much revenue did you earn over the course of your relationship with this customer?
- ROI on CAC: What is the ROI on acquiring this new customer?
- Time to Payback on CAC: How long does it take you to recoup the investment you’ve made to acquire this new client?
*For a fantastic review of the metrics you and your marketing/sales team should be focusing on, check out David Skok’s article, “Building a Sales and Marketing Machine,” by clicking here.*
So who truly owns these metrics? After all, your sales and marketing teams (should be) working hand-in-hand to attract and deliver new clients. According to Halligan, you may want to consider apportioning your budget as follows:
- Sales: 2/3 of your CAC budget (or 2/3 or your marketing budget)
- Marketing: 1/3 of your CAC budget
Finally, Halligan advised attendees that they, as financial leadership within their own companies, should be the keeper of this data. Work alongside your sales and marketing teams as a partner to help guide them through the process of finding these metrics, and keep them accountable to the numbers.
Sometimes You Get In The Strangest Places
Brian Halligan, HubSpot, sharing marketing lessons
from The Grateful Dead
Want to see a successful inbound marketing program in motion? Believe it or not, check out the history of the Grateful Dead.
Unlike other bands of the day, the Grateful Dead made their money on concerts, not albums. Each and every concert was played different, which kept their fans coming back night after night to see what they’d do the next time. Studio albums were produced, but the fans preferred to make mix tapes of their favorite songs from their favorite concerts and give them to their friends.
The Grateful Dead effectively cut out the middle man and sold directly to their fans (shifting outbound to inbound). Rather than hiding behind their records, they gave away their content for free, turning them into one of the most iconic bands with the most loyal fans in history.
For a full breakdown of how The Grateful Dead, and their lessons for inbound marketing, check out Brian Halligan and David Meerman Scott’s book, “Marketing Lessons From The Grateful Dead: What Every Business Can Learn From The Most Iconic Band In History.”
What a long, strange trip it’s been indeed. Looking for more? Check out these great resources:
- A blog from sponsor Carlson Management Consulting, who wrapped up Brian’s Halligan’s chat
- A blog from attendee Andrew McDonnell, Corporate Performance Manager, Adaptive Insights, who also commented on Brian Halligan’s chat
HubSpot’s Inbound Hub blog, a great resource for definitions, metrics and ideas to boost your inbound marketing program
Photos and More Information
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