CFO’s need to keep their friends close...and their marketers closer if they want to become value drivers

CFO’s need to keep their friends close...and their marketers closer

Not that marketers are the natural sworn enemies, surprisingly it could be quite the opposite. Recent research shows they might actually become your best guide in FP&A (Financial Planning & Analysis) by introducing a new leading metric: Share of search.

We all know the struggle of backtracking marketing investments into sales numbers, without any actual proof that it was just those who caused it. A group of marketers have now turned that around and started to measure the interest generated by marketing leading up to a sale, proving simultaneously a correlation with subsequential market share trends.

The logic is rather simple. With over 89% of all purchases originating with online search engines (both in B2B and B2C), it is worth investigating how much of that space is occupied by your brand or company. The more space that is taken by your company at the start of the process, the more it will lead to sales down the purchase funnel. 

The research covers approximately 15 various types of industries and has shown correlations of as much over 90% for multiple brands. It furthermore showed that the lag between the leading metric of Share of search and the movement in market share, was very much related to the speed of the industry’s sales cycle. FMCG, for example, had a much smaller lag (approx 14-30 days) between movement in share of search and similar trends in market share, than the fund industry where this lag was about 7-8months.

Share of search could thus become a strong leading metric quantifying the contribution of marketing with market share being the following parameter. With the budgets being locked for most of us, it could be interesting to experiment the approach this year and see how it could also ease budget discussions in Q4.