With Digital Marketing spend aimed to reach nearly $150 billion in the US by 2023, according to Forrester, there’s no question that Marketing is an important function for any business. While there is no hard rule on how much a business should spend on Marketing, the Finance department is an important ally in ensuring that Marketing spend and strategies can be implemented.
Wistia’s main product is a Video Marketing application, used by over half a million businesses. As a company, we understand how important marketing is to our overall business strategy.
For marketers, it has become increasingly important to retain close ties with the finance team. This allows both sides to gain visibility into what activities are being implemented and what can still be achieved for market-specific campaigns, as well as provide transparency into how budgets can be allocated across business functions.
For example, in the Fall of 2018, our marketing team was poised to promote the release of “One, Ten, One-Hundred”, an original docuseries chronicling how exactly budgets can affect Video production. Collaborating with LA-based Sandwich Video to create three different video ads with the production budgets of $1K, $10K and $100K; this was Wistia’s biggest Marketing campaign to-date with the largest advertising budget, so the marketing team had set aside budget throughout the year in order to be able to promote the series.
In the same time period, Wistia’s Finance team was also at a point where they could forecast for the year and the team was trying to figure out where we were going to end on EBITDA, a key financial metric around profitability. Since we work closely with the Marketing team and have a line of communication open, we were able to anticipate how big they wanted to go in the final months of the promotion for the docuseries and were able to expect the spend in our budgeting forecast.
In addition, the extra spend on Marketing was no surprise to the Senior management and the Board members, since it was reported correctly and transparently to the Finance team.
It’s also important to “speak the same language” as your finance team – for example, if the Marketing team needs to hire a consultant for five months, understanding how the Finance team will handle the billing will allow the Marketing team to better understand how to manage their budget. Marketers should always want to make sure they are on the same page with the Finance team so that unexpected expenses don’t pop up too frequently and they can spend the Marketing budget on activities that will truly drive awareness and interest for the company.
In order to effectively give insight into Marketing spend, our Finance team needed to employ the right tools for our growing business – with our workforce doubling from 40 to 95, our revenue growing about 33% in a year, and our products being used by over 500,000 businesses all around the world – the old combination of QuickBooks Online and Excel weren’t enough.
As a company, we made the decision to move to Sage Intacct, a Cloud Financial Management system that streamlined our financial processes and offered the ability to easily build custom reports that provide better visibility into budgets and the overall financial health of the business. With this new platform, our company was able to cut our monthly close time nearly in half – from 15 to eight days – and reports could be generated at the push of a button.
With the fast turnaround of these reports, our team found out that there was room in the budget to allow the Marketing team to fully execute the One, Ten, One-Hundred campaign and still achieve our EBITDA goal for the year. The reports allowed us to get results faster, giving us the ability to pivot and make decisions in the most agile and effective ways.
Transparency and communication are the foundation of a successful relationship with your Finance team and in turn, allows for the most cost-efficient Marketing campaigns. By working with your Finance team closely, a business of any size can maximize their spend and get the most impact out of their Marketing budget.
Taking the learnings from the One, Ten, One-Hundred campaign, Finance and Marketing are armed with the tools needed to effectively manage the production and promotion budgets of our new series, Brandwagon.