Financial Services

Marketing and Accounting: An Essential Partnership for Business Success

Photo by Katie Harp on Unsplash

Marketing and accounting may behave like opposing camps in many organizations — and it’s often true. From the marketer’s perspective, accountants are the ones who say no to those big, audacious campaigns, and they’re the ones without a single creative bone in their body. Accountants, on the other hand, may view marketers as manipulative or flaky. In contrast to the bottom-line-focused, deadline-driven approach needed to keep a company’s financials updated and materially correct, marketers may come across as an over-zealous bunch eager to do things without any real grasp of how much a new ad campaign is costing, or whether it’s actually effective.

But these two areas have much more in common than you might think. And when they work well together and establish a link between their departments, this is the difference between a chaotic organization whose campaigns are like throwing stuff against the wall to see what sticks and those that have a carefully scripted approach that includes all parts of an organization.

Opposing Viewpoints

Accounting and marketing occupy two extremes of intellectual abilities. Accountants are numbers people. They’re analytical. They believe in following rules and processes. They love checklists (this month end close checklist is a great one). As stewards of a company’s resources, they want to see a return on investment for company initiatives. But they do have a creative side: the current explosion in automation and artificial intelligence is pushing them to reimagine how they get their work done. 

Marketers, on the other hand, leverage the creative power of their imagination to get inside the heads of prospective customers to see what makes them tick. They work with words and images, two areas that accountants may have to translate into numbers to comprehend. By necessity, they are always seeking fresh ways to get the attention of new customers. At the same time, they are also carefully evaluating the work of other marketers to see what’s working, what’s not working, and are always on the lookout for new ideas to borrow. Their analytical side shows up when they examine data from their campaigns to see which ones resulted in new leads and new customers, and which failed.

Marketing and Accounting As Communication

Marketing and accounting both have the same overall goal: to see their organization thrive and succeed, and both do this via communication.

The purpose of accounting is to communicate the results of financial transactions between an organization and the outside world. They communicate these results by means of financial statements that are used by executives and leaders within an organization and stakeholders such as bankers, investors, and other interested parties to help them make decisions.

Marketing communicates with the outside world so that prospective buyers are aware of an organization’s products and services. Their efforts address the many levels of prospect awareness, from those who are unaware that they have a problem to those who are ready to purchase, and just want to negotiate terms. Marketing helps people find solutions to problems and to decide which solution is best for them.

A Symbiotic Relationship

Marketing and accounting are essential functions within a successful organization, and while they each have their own separate tasks, there are many areas where contributions are needed from both areas.  For example, financial projections and company planning are often based on anticipated levels of marketing activities.

Annual reports that communicate company results with stakeholders are a joint project between accounting and marketing. Accounting provides the numbers, while marketing provides a narrative that puts those numbers in the context of company accomplishments and the external business environment.

Any decisions to develop a new product or service or to drop an existing one depend on input from both sides. Accounting supplies analysis of the potential ROI while marketing provides information gathered from business trends and customer demands.

And let’s not forget that pricing is a form of marketing. From the accountants’ point of view, the price should cover the cost of providing goods and services to a customer, and should support company revenue goals. But a company’s pricing strategy also conveys a marketing message. Low prices can imply poor quality, while premium pricing may lend the perception of luxury goods. Determining the appropriate pricing strategy demands input from both marketing and accounting.

Creating a pleasant customer experience is another area where marketing and accounting can work together to create synergies. The least expensive customer to sell goods or services to is an existing one. Creating an environment to ensure that all of the ways that a customer interacts with an organization are positive can turn a one-time buyer into a loyal repeat buyer. Marketing can help with clear customer communication, enticing website messaging, and a well-designed customer interface. Accounting can make it easy for customers to do business with the organization by offering convenient payment options and clear refund procedures.

Measuring the ROI of Marketing

Assessing the success (or failure) of a particular marketing initiative requires data from accounting and from marketing systems. However, while measuring the costs of a marketing campaign may be calculated relatively easily from accounting data, matching those costs to revenue can be elusive. Even with today’s increasingly sophisticated technologies for tracking website visitors, it can be difficult to definitively tie a sale to a particular marketing asset, especially when some data may not be tracked at all. Or, if the data is tracked, analysis may require combining data from the two separate systems for accounting data and marketing data, which do not always communicate well with each other.

This means that marketing and accounting will need each other’s help to develop a system to determine how marketing spend translates into increased revenue and profits for the company. A bare minimum would be tracking the ratio of sales to marketing expenses over time. Efficient campaigns will tend to increase sales, but if marketing expenses are increasing at a faster rate than sales, that’s a sure sign that a particular approach is not working.

Besides dollars to the bottom line, successful marketing campaigns may bring intangible benefits, such as improving brand reputation, increasing market penetration, or enhancing customer satisfaction. These measures can be more difficult to assess and may accrue over several years, yet should not be ignored. Customer surveys or market research can provide insights that accounting and marketing will need to evaluate together.

The Best of Both Sides

Accounting can keep marketing focused on cost-effective campaigns that demonstrate a positive ROI. The accountants can also help in determining the best timing for a particular marketing spend, and ensures that marketing expenditures are appropriate and within budget. Accountants can help marketers take a data-driven approach for assessing campaigns and communicate those results with company decision makers.

Marketing can help accountants raise their heads above their beloved spreadsheets to see the bigger picture of what an organization is trying to accomplish. They can help accountants connect the financial results to overall company goals in their communications with the board and executives. And they can help accountants see their number-crunching in a more creative light.

When marketing and accounting work together as partners, the resulting synergies can help a company focus on efficient and effective ways to achieve company goals. Tying company performance measures to marketing messages and communicating those results through the whole company can unite an organization around a common objective. The resulting excitement and increased employee engagement keeps everyone motivated and pulling in the same direction together.

That internal enthusiasm can’t help but spill over to the outside world, resulting in a thriving, successful company with loyal customers — helping create what every business wants.

Marketing and Accounting: An Essential Partnership for Business Success
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