When it comes time for your CFO to sit down and plan your department’s budget for the year ahead, how are you going to convince them to leave your marketing budget unscathed? With over 90% of businesses relying on at least one inbound marketing strategy to meet their marketing goals, there’s no question that CFOs are having a harder time quantifying marketing ROI. That being said, if your business is struggling to meet its overall objectives, any unquantifiable expense can seem like the perfect candidate for a budget cut. In the case of inbound marketing, however, it likely isn’t true.
Before making any budgeting decisions for the year ahead, the first thing your CFO will do is take a look at last year’s spending. After comparing the amount spent to whether or not you’ve reached your goals, they’ll be able to determine what’s working, what needs fixing, and how they can arrange their resources to maximize profitability for the year ahead. If your business needs to cut spending, be prepared to justify every dollar you spent!
As your business looks to cut back on its costs, however, it’s important to only eliminate the expenses that won’t cause more harm. Though it might seem easy to simply cut marketing expenses upfront, you have to consider what else you’re losing. For example, imagine that you’re able to save over $15,000 by cutting back on your content development and blog publishing. However, after six months in your reduced blogging strategy, your SEO starts to decline and your leads have been cut in half. As you struggle to generate leads and new sources of revenue, suddenly that $15,000 doesn’t seem too costly after all.
In order to develop a marketing budget that will truly help optimize your business’ returns, you have to treat your budget as if it’s an investment, not just some cost incurring expense. Though it sounds cliché, you really do need to spend money to make money! On the other hand, with that being said, CFOs know better than to just allow any kind of spending.
For a marketer to build a strong argument for keeping their inbound marketing budget, they must first understand the full dynamics of their sales funnel. How do you attract prospects at each level of the funnel? How much time and resources do you invest to find prospects? How many prospects become leads? How are your leads nurtured? These are just a few of the questions you’ll need answers to in order to help quantify your inbound marketing results.
Once you have a full understanding of your strategy and tactics, it’s time to go through and pair it with your website’s metrics. This allows you to showcase cause-and-effect results for your marketing tactics. In fact, by developing a more complete understanding of how certain strategies and tactics work with your target audience, now marketers can walk their CFOs through scenarios that explain how specific actions can translate into more web traffic, leads, and clients down the funnel. On the flipside, this also gives marketers a chance to argue against any negative impacts the budget cuts might have.
Of course, none of this can be considered a simple task. CFOs are hardwired to make decisions based on thorough financial research and safe accounting principles, so the evidence you present must have a rock-solid foundation with compelling selling points. Luckily for you, Weidert Group President, Greg Linnemanstons, has written two blogs on exactly just that:
How to Convince Your CFO That Inbound Marketing is a Sound Investment
Goal Setting to Show a CFO the Financial Value of Internet Marketing
Next time your marketing department’s budget is up for review with your CFO, make sure you’re prepared to make a case for yourself! Whether you need to avoid spending cuts or ask for MORE marketing spending, you can’t afford to view your marketing budget as anything less than one of your business’ most important investments.
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Topics: Inbound Marketing, Inbound Sales
