Last week was a special one for those of us that call ourselves inbound marketers. The Boston Convention Center was home to Inbound 2015, where nearly 15,000 marketers gathered to learn more about inbound marketing. The event featured an impressive lineup of speakers, but I thought one talk provided valuable insight into how we as marketers should pitch any investment in inbound marketing to our CFOs. The session was called “Bringing the CFO &CMO Together: Strategies for Success” and was delivered by JD Sherman, President and Chief Operating Officer of HubSpot.
As a former CFO myself, I found the following to be one of the key takeaways:
Outbound marketing is an EXPENSE.
Inbound marketing creates ASSETS.
You do not need to be a CFO to understand that something that creates an asset should be more valued than an expense. But, like other marketers in the room, you may be wondering how anything related to marketing can create an asset.
Here are three ways inbound marketing creates assets:
1. Inbound Marketing is About ‘Building a Lead Generation Factory’
Content is the foundation of inbound marketing and it is a building block of your factory. A blog post, for example, generates traffic and leads at the time it is posted, but that content continues to work for you.
At HubSpot, 92% of their leads come from old blog posts. These content assets are always working on the web and generate steady traffic with drives predictable lead activity.
2. Inbound Marketing Can Track Everything
As part of any successful factory, you need processes and systems in place that allow you to measure the effectiveness of the activity being performed in the factory. And we all know that CFOs crave data, the more the better. With today’s marketing automation software it is easy to track everything from visits to leads to customers.
JD used the following quote from John Wannamaker (one of the early pioneers of marketing): “Half my advertising is wasted, I just don’t know which half.”
Probably because I am a “glass is half full” person, I put a different spin on this quote: “Half my advertising works, I just cannot tell you which half.”
With the software available today, marketers can measure each and every campaign and calculate the return on each initiative. Today’s CFOs demand accountability and ROI analysis, both of which you can provide with an inbound marketing strategy.
3. Inbound Marketing is Cheaper than Outbound Marketing
Last, but not least, there is an overwhelming amount of data that clearly demonstrates that the cost of an inbound marketing lead is significantly less than an outbound marketing generated lead. According to HubSpot’s 2014 State of Inbound Marketing Report, inbound marketing generated leads cost 67% less than outbound leads.
Historically, it has been hard for CMO’s to provide enough compelling information to the CFO in order to make the case for increased marketing dollars. Capital is a very precious resource in the eyes of the CFO. Advertising has been viewed as a necessary expense. Advertising activity was difficult to measure and generated unpredictable results. With the stigma of a “necessary evil”, the typical approach would be for the CFO to allocate a certain percentage of revenue to marketing activities.
With inbound marketing, it is now possible for the CMO to fundamentally change the discussion with the CFO about the marketing spend. By following inbound marketing best practices, a CMO can build a lead generation factory that creates content assets, which leads to predictable activity that can be measured and tied to a ROI.
Inbound marketing allows a CMO to make a persuasive case for increasing the marketing budget. Ready to make the pitch to your CFO?