COMMUNICATION
The Increasing Importance Of Financial Knowledge To A Marketer
By Katya Nyangi
While companies proactively try to keep ensuring different departments communicate and have a glimpse of what is happening in each other ’ s worlds , for marketing , it is inevitable . Marketers are probably amongst the most knowledgeable about what happens in each of the departments and if they are agile , they would be quick to connect the dots and create marketing value from the crossfunctions .
One interesting symbiotic relationship is that between marketing and finance . It is not uncommon for finance to question what appears to be flamboyant marketing expenses when under pressure to manage and cut costs . And yet , to increase revenue that would then give the organisation more financial leeway , marketing sits at the centre . While operations would present on how they are managing expenses and costsaving where possible , marketing would present on how they are going to spend more ! For this reason , marketing may not be the favourite of other departments within the organisation , who are not in direct contact with the ROI of these expenses on the bottom line .
If marketing and finance see each other as strong business partners , however , a lot more value can be created for the organisation , including the buy-in of other departments within your institution . Some of the aspects to consider include :
Analytics and budgeting
Both marketing and finance are analytical departments that work with a variety of data sets to come to various conclusions and strategies . Nonetheless , they each approach this from east vs west . While marketing is thinking of where to spend more for maximum return , finance starts with where to spend less ; marketing wants to jump into risk and finance wants to manage risk . This is actually a great point of synergy if the perspectives merge . This is where financial knowledge of marketing will come in extremely handy in bringing in the numbers and speaking in financial language to demonstrate how marketing will contribute to the sustainability of the business with its expenses - excel is truly a marketer ’ s best friend . Still , when marketers are asked for training needs , rarely does financial fundamentals and excel join the list .
Beyond likes and clicks
Likes and clicks and reach are all essential to building brand reach , reputation and bandwidth for reaching your audiences . They are the underlying requirement for your direct marketing . But in this case , a marketer needs to understand what is important to demonstrate when working with finance as a partner and working on budget approvals . In the process , you might surprise yourself in realising that perhaps , indeed , one of your expense lines did not hold merit and can be omitted or redirected . How do you show the relationship between the clicks and the likes around an activity and an increase / decrease in conversion through direct marketing ? Just like finance demonstrates a business ’ s performance with reference to Year on Year comparisons , a marketer should be able to do the same . This can be done by demonstrating to finance ( among other stakeholders ), how your direct marketing performed when you did not run any brand engagement campaigns vs how they performed when this was happening simultaneously and equally how the expenses compared to your Year on Year performance . For example , did spending more on marketing for similar activities at the same time of the year increase revenue for the business or did it stay flat ? This becomes how you both plan and justify your budget . Meanwhile , finance , with objective information at hand , may be able to point out how you may utilise your budget for maximum output from a financial perspective given the exposure you have given them to your process .
The financial knowledge a marketer should seek to understand
Therefore , it is crucial that as marketers build their careers , they also build their ability to understand at least the following financial areas : Basic understanding of financial statements : to properly understand where the business stands at present and make a case for marketing ’ s contribution ; Interpreting a balance sheet : to make a case for where marketing can come in to make this a more positive balance sheet ; and Excel functions & formulas : to be able to present data that shows relationships between different areas of your activities and to calculate for the future .
Together , and in a harmonious relationship , marketing and finance can enable the business to make the best decisions possible . Ultimately , every employee holds a marketing role . It is upon marketing to equip their colleagues by including them and involving them in both marketing activities and reporting , and to seek to understand as to be understood , by each department within the institution .
Katya Nyangi works in education management as the Communications and Marketing Director for Makini Schools . You can engage her via mail at : Katerina . Nyangi @ gmail . com . * The authors views are their own and do not necessarily represent the views of the organization .
50 MAL50 / 22 ISSUE