Chris Andersen - Nicole Anasenes -  John Evarts
March 4, 2022

CFO Panel: Investing in the CMO Role

Guest: Chris Andersen - Nicole Anasenes - John Evarts - CFOs, Acquia - Ansys - Mediafly

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For a locked room labeled “Marketing Spend,” the CFO holds the keys. And they aren’t going to be quick to hand them over, either. This all-important alliance depends on the CMO’s fluency in CFO-speak, AKA how $1 into marketing will equal more $$$ out. Luckily, it’s not too hard a language to pick up. 

In this episode, we’re airing three Q&As with three CFOs who laid out their formulas for a great CMO/CFO alliance during a recent CMO Huddles Super Huddle (a bi-annual mega-huddle exclusively for our community of B2B CMOs). Tune in for some wonderful insights from Chris Andersen of Acquia, Nicole Anasenes of Ansys, and John Evarts (now President and COO) of Mediafly—insights that CMOs just might want to share with a CFO who’s on the fence about the power of marketing. 

What You’ll Learn in This Episode

  • 3 CFOs’ perspectives on marketing
  • Tips for navigating the CFO/CMO alliance 
  • How to build trust with your CFO

Renegade Marketers Unite, Episode 282 on YouTube

Resources Mentioned

Time-Stamped Highlights

  • [0:00] Cold Open: The CMO Huddles Super Huddle 
  • [2:16] The CMO/CFO Alliance
  • [6:28] Acquia CFO on Marketing, Dry Powder, and Camaraderie 
  • [15:26] Ansys CFO on Super Bowl Ads, Proving ROI, B2B Branding
  • [27:14] Mediafly CFO on Building Trust, ABM, COOing

Transcript Highlights: Drew Neisser in conversation with Chris Andersen, Nicole Anasenes, and John Evarts

[0:00] Cold Open: The CMO Huddles Super Huddle 

Drew Neisser: Hello, Renegade Marketers! It’s Drew, your host, who else, here to introduce a very special episode of Renegade Marketers Unite. Now I know you’re thinking: “They’re all special.” And they are all special, but this one is a bit different because we have not one interview, but three, with three CFOs about the CFO-CMO relationship. 

Ask any CMO where the budget comes from, they’ll tell you. It’s about the CFO, and these are people who don’t necessarily understand marketing. Now, the three CFOs that you will hear on this show get it. It’s Chris Andersen of Acquia, Nicole Anasenes of Ansys, and John Evarts of Mediafly who went on from CFO to become President and COO of that company.

The conversations were recorded during a Super Huddle, one of our bi-annual mega-huddles exclusively for our CMO Huddles community. Now, after each of these conversations with the CFOs, the CMOs at the huddle broke out and talked about strategies for building stronger relationships with their CFOs. How they could build trust, the kinds of things that they could put into action that could help them when it was really time to scrub those budgets and help the CFO understand the impact of marketing as an investment, not an expense. 

Anyway, if you’re a B2B who can share, care, and dare with the best of them, do us a favor and go visit CMOHuddles.com and see if you qualify for a guest pass. Now, let’s get on to the episode. I really hope you enjoy it.

[2:16] The CMO / CFO Alliance

Calling all CMOs: “No other relationship can contribute more to your success than the one you have with your CFO.” —@DrewNeisser Click To Tweet

Drew Neisser: Thank you, huddlers. You all rock and I thank you for your ongoing commitment to sharing, caring, and daring each other to greatness. Ken Blanchard famously said, “None of us is as smart as all of us.” And to that I say, “Together, we’re pretty darn smart.” This community knows how to build demand generation engines in their sleep, though not necessarily how to get more sleep. This community knows how to build unbeatable B2B brands, and many of you are commemorated doing just in my upcoming book Renegade Marketing: 12 Steps to Building Unbeatable B2B Brands. 

But what really makes this community special is your unwavering commitment to continuous learning, your willingness to challenge your own assumptions, your curiosity—not just about all things marketing, but about all things leadership. It takes courage just to be a CMO today, and it takes even more to be a great one. And it is the pursuit of greatness that brings us together today, pointing the spotlight on your relationship with your CFO. 

After your relationship with your CEO—which we highlighted in Super Huddle 2, it is easy to make the case that no other relationship can contribute more to your success than the one you have with your CFO. It’s not just that they either control or influence how much your department can spend on staffing, technology, vendors, and media. It’s that with your CFO as an ally, your chances of gaining and keeping the trust of the rest of the executive committee and board skyrockets. And without that trust, forget about driving purpose, building brand, and doing anything else truly transformative. 

So, let’s take a quick look at the current state of your CFO relationships. In the poll we fielded last month, 90% of you acknowledged that your CFO plays a critical role in the marketing budget approval process. But only 40% have worked on an ROI model with your CFO. 53% strongly agree that you have an effective working relationship with your CFO, that’s awesome. But only 19% strongly agree that my CFO supports me during board meetings, not so awesome. 44% strongly agree that my CFO believes in marketing, kind of awesome, but only 22% strongly agree that my CFO believes in investing brand. 

A Forrester study on the CMO and CFO alliance points to a similar disconnect when it comes to CMO and CFO priorities. But it offers lots of hope. Here’s my favorite quote from that report: “If marketing is to be seen as an embedded contributor to the business, CMOs can no longer be on the defensive about the challenges of marketing measurement and business alignment. They should instead go on the offensive with a CFO by their side.” 

Forrester also describes the spectrum of the CMO and CFO allyship going from detached to associated to embedded. Our goal is to get you embedded, and embedded looks like this: CFOs play a role in marketing. CMOs have credible financial acumen, marketing is perceived as a business driver, and the CMO is empowered to be bold. 

Our goal today is to help you identify the gaps in your relationship with your CFO to help you put together an action plan to help you move from being defensive to being on the offense—without being offensive, of course, to get there, we will be meeting with three amazing CFOs. 

[6:28] Acquia CFO on Marketing, Dry Powder, and Camaraderie

“Marketing spend is rather unique. It can be dialed up, some cases down, more quickly, and provide more immediate results than any other operational spend in a company.” —Chris Andersen @Acquia Click To Tweet

Drew Neisser: Let’s get to it. It’s my great pleasure to introduce you to Chris Andersen, CFO of Acquia. Before joining Acquia, Chris spent a combined two decades as VP of Finance at Akamai, Progress Software, and Novell. Chris, how are you? 

Chris Andersen: I’m well, I’m well. Thanks so much for the opportunity to be part of the huddle today! 

Drew Neisser: I do see that you have the Acquia logo behind you; you’re on brand. Well, it’s funny because when we had our pre-thing you actually were wearing the brand. I thought, that’s pretty good indoctrination for a CFO. 

Chris Andersen: Trying to do my best. 

Drew Neisser: Yes. All right. Well, when we spoke in August, you and your CMO Lynne Capozzi seemed to have a very strong working relationship. Now that it’s just the two of us, what’s the real story? I mean, seriously, can you talk a little bit about your relationship and how it’s evolved over the last three years?

Chris Andersen: Yeah, I’d be happy to do that. And I would actually say that my relationship with Lynne is one of the aspects of my job that I really enjoy. Probably the natural starting point for that relationship was working through budgets and forecasts. I would say that’s a good mechanism for a CFO to understand a CMO’s priorities and thought processes. 

Then that working relationship really quickly accelerated for Lynne and myself. We had to work closely together about two years ago through a change in leadership and company ownership, actually, from venture capital to private equity. 

I would say Lynne’s input on positioning and messaging during that transaction was quite valuable and it really helped fast-track our relationship. I would add that, you know, probably a familiar topic for this group is pipeline. 

That’s been a long-term journey for Lynne and myself at Acquia. There have been a lot of ups and downs as we tried to focus and improve our reporting and invest more in pipeline, a lot of readouts with the CEO, a lot of discussions about what’s working and what’s not working. 

So now, after three years of working together, I can I think confidently say that Lynne and I look to each other as sounding boards, even in some cases confidants, on a variety of topics and issues well beyond forecasting and pipeline. 

And then I would just add at the end—because this is the lighthearted part—somehow along the way over the last three years, we’ve developed a banter and a competition between finance and marketing that’s fairly visible at the company level and company meetings, company videos, with things we say and do, and jokes and comments. 

In fact, I would say it’s probably even visible to the board of directors, and I think that makes the day-to-day part of the job a bit more fun.

Drew Neisser: Oh, that is fun. And that is an unexpected situation because you don’t actually think about fun coming out of finance. I mean, no offense.

Chris Andersen: Ouch! [Laughter] That sounds like something Lynne would said to me.

Drew Neisser: Well, I guess, yeah, I’m kind of on her side a little bit here. But there are no sides. You’ve got a lot of things to do. Where does marketing spend management fit into your day-to-day activities?

Chris Andersen: You know, I would say the good news is that marketing spend management is not at the top of my list of concerns. We have a strong CMO, great marketing team, things are working well on the marketing team, the marketing team is well connected with the finance team through a business partner on my FP&A team. 

So as a result, when I do get a focus on marketing spend management, it’s more strategic in nature. It’s usually in conjunction with Lynne and our CEO. I would say that as every CMO and CFO knows, marketing spend is rather unique. It can be dialed up, some cases down, more quickly, and provide more immediate results than any other operational spend in a company. 

I view marketing as a really strategic spend lever. It’s not really ever been a concern; it’s really been more of an opportunity.

Drew Neisser: I’m interested in that because strategic spend implies that you have the ability at any given time to put more money in or take more money out. 

I’m curious, how do you look at that and make the determination with Lynne: “Okay, this is worth putting more money here,” instead of, say, “Let’s hire some more people or let’s invest in product” or those other options where you can spend money?

Chris Andersen: Great question. I’d say there’s probably two pieces to that one. We spend a lot of time as we do the planning to get the base in place for how we’re going to message to the market, how we’re going to get the brand set. 

And then where we often leverage up during the year when we have excess capacity, we actually set aside what we call “dry powder” in our plan. We’re fairly transparent about it. It’s funds that we can leverage as needed. 

If we’re doing well, what we’ve done this year is we’ve actually leveraged dry powder a few times for marketing. It’s really for demand gen, kind of mid-year to help drive more opportunities, to help drive the pipeline, and hopefully accelerate the top-line growth for the year. It’s really, what’s our base for the year and then what’s our opportunity throughout the year to leverage some of that dry powder to accelerate growth?

Drew Neisser: I love that expression “dry powder.” I can imagine all the CMOs here are writing that down saying, “Okay, what are my dry powder plans? And do I have a CFO who actually will turn to me and ask about dry powder?” 

One of the things that we talked about was your desire for predictability in terms of revenue related outcomes. Can you talk about how you guys have worked on that challenge together?

Chris Andersen: Yeah, I would say one really good example was our approach to planning for this year coming out of COVID. Acquia in a growth mode, like probably a lot of other companies in this huddle, and we made a really significant investment in sales capacity around the world. Pretty significant. I’m amazed that the board let us go that deep, so to speak, on the spend in sales. 

As a result, we had to make sure Lynne’s team was also properly funded to support the expected ROI from sales. So, Lynne and I and our teams, we spent a lot of time late last year, early this year making sure that marketing had sufficient budget to support the demand generation and to drive the market coverage needed to grow the top line this year in what was really an aggressive plan. That work really included some new and improved pipeline modeling that we had to do. 

Another example was analysis of historical returns on demand gen activities to make sure that we were funding marketing appropriately, not just across activities, but across regions and across all the quarters—get the timing right across the year to support those sales efforts. 

It really was a combined effort I would say among Lynne, myself, and our CRO to make sure the sales and marketing plans were connected and well aligned just given the level of investment and expected growth this year.

Drew Neisser: So, I heard pipeline model in there. And obviously, that’s a really important part of getting you to predictable and it feels like you two work on these things together. That’s a critical part of this whole thing. I’m just wondering—we have a couple more minutes—what’s your advice to other CMOs who want to gain credibility with their CFOs?

Chris Andersen: That’s a good question. I think, from my perspective, I would say it would be helpful if a CMO is willing to cross over and try to put themselves into the CFO’s world and gain an appreciation of the growth and profitability pressures that the CFO faces with the board, with investors, and then try to frame marketing needs in that lens. Put you in the same side of the boat so to speak with the CFO. 

But by the same token, I would say—and hopefully I’ve tried to do this—CFOs probably need to be willing to do the same and cross over into the CMO world and understand what they’re trying to drive and the pressures they face so that the CFO and the CMO can better understand each other. 

Drew Neisser: Interesting. There really is this crossing over where you get an understanding of marketing, Lynne has an understanding of finance and how the company makes money and how these investments could be made. 

One of the big issues that I think a lot of CMOs face is that the marketing is absolutely just seen as an expense. It’s a cost. It’s a percent of revenue period, and it’s going to be a fixed cost. How did you get to see—or do you see marketing as an investment that could actually—again, is a choice?

Chris Andersen: Yeah. So, every operating dollar we spend is an investment. Marketing is no exception. What’s impressed me with Lynne and her team is their ability to show a return on every dollar spent so that, if we need to drive the top line by X, they can come in and say we can spend Y to make that happen. 

And so, it makes it very easy, especially as we’re looking at dry powder to think about what the return on that dry powder investment is going to be because her team can come to the table with facts and figures and really help us appreciate that the money is going to be put to good use.

Drew Neisser: Chris, thank you so much for this input. It was invaluable. I really, really appreciate you spending time with us. 

[15:26] Ansys CFO on Super Bowl Ads, Proving ROI, B2B Branding

“If we are dependent on direct sales teams to convert that marketing dollar and we don't invest in the direct side, it's not going to matter how awesome the marketing is.” —Nicole Anasenes @ANSYS Click To Tweet

Drew Neisser: We’re gonna move to our next speaker now. I’m thrilled to introduce you to Nicole Anasenes. She’s the Senior Vice President and CFO at Ansys. Before joining Ansys three years ago, Nicole was the CFO and COO at Squarespace for four years, and also enjoyed a long run at IBM before that. Hello, Nicole!

Nicole Anasenes: Hello, how are you all? Really nice to meet you.

Drew Neisser: It’s really nice to have you here. And I’m excited because I’ve always wanted to have a conversation with a CFO that approved spending on a Super Bowl ad.

Nicole Anasenes: Well actually, I approved it four times.

Drew Neisser: Four times! Okay, so let’s say, at what? $2.5 million apiece, so that was $10 million in two minutes?

Nicole Anasenes: A little bit more than that. $2.5 million would have been easier to approve than what they actual cost.

Drew Neisser: So, it was a lot more than that. I’m just wondering, because that’s the extreme that most of the CMOs in our Super Huddle today would dream about, having that level of awareness. How did the rationale go to get you to approve that?

Nicole Anasenes: Yeah, well, I think it goes back to the initial time the decision was made around Superbowl spend. So just for some context, Squarespace, when I joined, was about $100 million in revenue, they had crossed the million-customer mark, and they’re very, I’d say, consumer-like SMB business, right? They enable people to present themselves online and transact online. 

The decision to do the first Superbowl ad actually happened three years before. At that point, when you look at the curve and you see the return on that investment, it was almost instantaneous because the company went from being known in the podcast space and the more digital channels that the company participated in to being more a household name just as a result of that one ad. 

And so, the impact of the Superbowl ad had always been perceived as this unusual event that has an enormous amount of unpaid attribution and benefit to it. That was the argument why it was perpetuated year after year. 

The honest debate as we got, you know, certainly it would have been seven years into it—or six years into it by my last ones was, what is the point of diminishing returns on something like that? Because you don’t get, as all of you know, your initial brand—well when you do an initial brand launch like that, it’s pretty pronounced, and you can get these step functions of changes. But the marginal rate of improvement is diminishing. 

Towards the end, we started to have debates overall—and actually, there was one year we decided not to do it. It was really about: What do you have to surround that Super Bowl spend to really amplify the brand with? 

Initially, you get the bump, and then all of your hard-working marketing starts to get super, super efficient as a result. But when you’re in those curves, you have to keep on upping the ante around the brand surrounding that one brand event. 

The decision framework around any of those ads was really, “If we’re going to do it, are we going to commit to the brand surround and the always-on drumbeat around that brand to make sure that it’s not just lighting a couple million dollars on fire?” Because you don’t get the same benefit they got the first time they ran it.

Drew Neisser: Interesting. Well, now back to B2B reality where that’s not something that I’m imagining is going to be a conversation that Ansys. You’re not going to necessarily buy a Super Bowl ad to catapult the brand into mass consciousness.

You and I talked about this perspective on just generally marketing as an investment versus marketing as fixed costs. Talk about this a little bit in terms of what it takes to get from this fixed cost model, which is so often the case, to a variable-based investment.

Nicole Anasenes: Yeah. So, I think what we had talked about in our earlier discussion was, when any CFO has no understanding of how to connect an operational action to a financial outcome or return, it just becomes an expense in some internal negotiations. And this is true for marketing, it’s true for non-quota carrying sales, it’s true for product, right? 

Then you start to do these efficiency metrics around, “Okay, well, what’s the expense to revenue ratio associated with that?” The conversations tend to be not very strategic, very short, and not very insightful. To the point that was made earlier by the colleague who preceded me, it becomes the fungible thing that you can just shut off when you need a roadmap, right? 

I think that the strategic way to have it be seen as a lever is to connect the dots to enable you to be able to explain, “When we put this $1 in, we get these $10 out.” And, of course, to the point of the earlier discussion, the brand return is a little bit fuzzier to draw that connection than a more hard-working channel—a direct response channel, AdWords, Google. 

Something that is quantitative, it’s a lot easier for a CFO to get the attention around to say, “Okay, I see. You put this $1 in and you’ve got $40 out” or “You’ve got these leads, and these leads connect to this level of conversion over this timeframe.” 

Anything that allows you to connect the dots and build the model and say, “This operational action created these outcomes” is going to be a lot easier for any financial organization to double down on something that you’re going to get something out of. It’s just a lot harder to do when that clarity isn’t there. 

And then in the absence of clarity, you know you’ve got to spend something, so you just limit it to the minimum required to not break the business, right? It’s not rocket science, really.

Drew Neisser: So, in that scenario, we talked about the fact that that really becomes just a performance optimization job. You get 3% of revenue, you optimize the spend against something and that’s the CMO’s fate. 

But let’s turn this around and talk about actually building an ROI model. Have you been down that path with Lynn in terms of getting there so that marketing is seen more as an investment that you can pump up or pump down?

Nicole Anasenes: Yeah, I mean, that’s definitely the strategic path we’re on together. You know, I joined the company at the end of last year, and I took on the CFO role—I’m only in my second quarter now. We’re building towards that, is kind of how I would characterize it. But that is the ideal. 

The ideal here is that you can connect the levers to outcomes in the short and the long term, because we look at the business at Ansys not just about, “Alright, how are we going to get to the quarter.” We have a huge opportunity ahead of us and a multi-year vision. Building brand over multiple years is something that is important to us, so we need to look at it from both dimensions. 

The additional thing I would add was something that I thought was quite insightful by your last huddle report out there, which is: Don’t forget the Chief Revenue Officer because the key to connecting those dots in a B2B direct enterprise lead sales force is, you can have the most amazing attribution metrics—that some of us CFOs do understand, by the way. Not all of us, but some of us understand those models on the front end. 

But it’s garbage-in garbage-out if you don’t have consistency and clarity on the conversion cycle that you depend on. So, if you’re a consumer products company, it’s the product conversion and the partnership with product. If you’re an enterprise sales company, it’s the conversion cycle around the direct sales force or the channel. 

Having that end-to-end view and the synchronization of it is really important because you can put the gas on marketing. If we are dependent on direct sales teams to convert that marketing dollar and we don’t invest in the direct side, it’s not going to matter how awesome the marketing is. And it’s going to be a terrible customer experience. We can’t ignore the middle and it is, in an enterprise, it is highly interdependent across that whole process cycle.

Drew Neisser: So, you use the B word as in “Brand.” And this is a word that we’ve had in huddles over the last year, where I’m going to say 25% of the CMOs can’t actually use that word in the board or with their investors because it sounds like “waste,” it sounds like “fluff.” You know, its colors and design. 

If Lynn were to come in and say, “You know what? Our brand, we just don’t have the awareness we need and that’s hurting us with some of our enterprise sales,” can you get yourself to understand the power of what brand is and how to measure it as a CFO?

Nicole Anasenes: Yeah, I mean, I think it depends on the business model of the company, right, and who your target customer is. In a quite transparent way, if our only focus was a core customer, which is the analyst who is our traditional historical customer, where it is objectively a pretty focused, targeted group, generalizable brand strategies are not going to have a measurable impact on that. 

It is useful to have brand in a more micro-sense targeted at those communities, whether it’s print or whether it’s where those communities go, running a Superbowl ad or, or even just generic AdWords spend or bigger spend that is brand focused and messaging is not going to be as effective. 

Once the mission starts to expand to more generalizable audiences where you need the top of the funnel in order to drive the business model, in my view, that becomes a point where the role of brand is increasingly important because you can’t have enough events and conferences and point-to-point interactions to be able to build your top-of-funnel marketing. 

And so, I do think it depends on the business model, it depends on the size and the nature of the core customer, and the channels by which they get their information and create consideration sets. 

I wouldn’t say it’s a one size fits all because in different companies, it looks different. And even in different subsets of IBM, I would probably have a different view of brand than in others.

Drew Neisser: Got it. Okay, well, we’re about to go under a breakout and we’re going to be looking for the top three ideas for building and maintaining a collaborative working relationship with your current CFO. Do you have any advice for these CMOs? Real quick, just one or two thoughts on how to build a more productive relationship?

Nicole Anasenes: Yeah, I mean, I think the ideas that were said earlier were great ideas. So first of all, communicate. Understand each other’s worlds. Make sure that they understand your operational actions. 

Make sure that you can partner to create a sense and a framework for how to think about what you’re doing and what outcomes are being created even if they can’t be very quantitative, and be very consistent and repeatable and deliberate about how you show results… I think, well, this is just one opinion, but we’re pretty formulaic, if you connect the dots and you connect the macro and the micro and put it in front of us, it’s a lot easier to understand.

Drew Neisser: All right. Perfect. Well, Nicole, thank you so much for being with us. 

[27:14] Mediafly CFO on Building Trust, ABM, COOing

“Until you get the data and until you're educated, the CFO is helpless.” —John Evarts @Mediafly Click To Tweet

Drew Neisser: Now it’s my pleasure to introduce you to John Evarts, who is currently the President and COO of Mediafly. John was the CFO of Mediafly for 10 years and was the President of CFO Roundtable of Chicago for three years. So don’t hold his promotion to COO against him. [Laughter] Anyway, John, it’s great to see you. 

John Evarts: Great to see you. Thanks for this opportunity. 

Drew Neisser: Oh, well… So, you were a CFO for a long time, and I’m curious if your perspective on marketing measurement and effectiveness has evolved over that timeframe?

John Evarts: Definitely. I’m probably at the five-year-old level now. I was kind of at three, and now I’m probably at five. [Laughter]

Drew Neisser: Yeah, I don’t think so. 

John Evarts: I think it definitely has evolved. I think part of the process—and we talked about it a lot today, right? We talked about education, and we talked about common language, and those are the things I think are absolutely critical in progressing our clear understanding of what are the important factors in driving the success of marketing initiatives. 

My view of, for instance, early stage, mid stage, and late stage has become much, much more, I’ll say, literate, as a result of partnering with Isabelle—and as a result of just evolving in my own career having worked with great CMOs.

Drew Neisser: So, at what point did you—initially when you started as CFO, did you see marketing as just an expense and have you changed and as it evolved in terms of your perspective on marketing as an investment? And if so, speak a little bit about what that means to you? 

John Evarts: I’ll tell you. I mean, I think I definitely did not have appreciation as much as I do now for brand. Brand, again, it is so interesting because there is a lot of salesmanship around brand historically. And so, a number of the CFOs that you’re probably dealing with have been burned, right? 

That’s the issue. It’s not an issue that brand unto itself is a bad thing. This is about understanding why air cover is important and understanding what the lift that can be removed from the sales teams will be if you have great air cover, right? 

The ultimate air cover is millions of dollars of spend on a Super Bowl. That is air cover in its finest. But it’s understanding, what are the different pieces that are necessary? What experiments can you run—small experiments? And I love that concept of experimentation where you’re thinking of a portfolio of experiments that you’re running at any given time and they’re small. 

One of the one of the comments that was made in one of the prior sessions is, don’t make big asks if you don’t have trust. And the reason why you don’t make big asks is, if you’re only making small asks, the CFO is kind of indifferent in small dollar amounts. 

Different per company, right? A thousand might be small for some and big for others. And a million maybe small for something big for others. But what does small mean? That is under the radar, but important to you so that you establish and experiment and understand and share and educate what that success metric will be when you say this works or it didn’t work and you come back to them to earn that trust.

Drew Neisser: There’s so many points in that, that I just want to put punctuation points on. “Don’t make big asks, if you don’t have trust.” Okay. Then the part of the experimentation—and as you were talking, I’m totally on board. We talked a lot in huddles about having experiments. Even mentioned it—Caroline Tien-Spalding had an experiment going prior to the pandemic in digital and it turned out that ended up being her whole budget during the pandemic. So, I think most of the CMOs here understand that. 

But I also wonder about this, can you move the needle enough with these experiments with a $25,000 investment that it could then become a big bet? Have you seen that happen where something you approved over the last 10 years, a small bet under $100,000, that you were then able to say, “Yeah, that worked great. Go spend 4x or 10x.”

John Evarts: Yeah, ABM, right? I mean, I think we’ve all started off with smaller bets around ABM in any kind of way, shape, or form. And as we start to understand it more and what pipeline we can drive, what visibility into deals, what competitive cycles, like where people are in their buying stages—understanding that and getting that visibility and clarity is so valuable, right? And then to be able to capitalize on that and then make decisions from that. 

So again, it started off as a small experiment, right? It started off as, “Okay, we’re gonna try this out. We’re gonna test this out. Here’s a small budget.” It’s less than one FTE for instance, so I’m not worried about hiring an AE. I’m not worried about wallet share of hiring a sales rep versus a small bet in that case. 

That was my small bet. And so when we rolled out ABM, it was pretty clear—Isabelle did a really nice job—”Here’s why I want to do it. Here’s the visibility I’m going to give to you. Here are the metrics that are going to be successful. And then relative to that success level, I’m going to come back and make more asks.” 

By reserving the right to come back to me with the success level: “When I achieve X, educate me what X is.” Let me know what you think and what you’re measuring your success against so that when we experience that success, yeah, it’s a lot easier for me to make an increased budget allocation based on that, whether that’s dry powder, or whether that’s marketing spend and reallocation.

Drew Neisser: Again, so many interesting, good points. Certainly, I think a lot of… It’s funny because I think in one of our huddles ABM was the big bet. But of course, it had to start small, so that makes sense. 

I want to go back to something you said, “So many CFOs have been burned.” What does that look like? What does that mean? What was the action that sort of got you there?

John Evarts: Well, I think we’ve all we probably experimented with this, right? And it’s websites. Early, early on—and again, I’m now dating myself—but when we’re rolling out a website or doing a refresh or any number of different things, there’s often very little metrics associated with that. 

And if you don’t have the discipline in figuring out what are the things that we need to do when tackling websites—and I’m probably talking, you know, 10, 15 years ago now, right? If you’re not giving what that success metric will be, then you have no idea if it’s working or not, and you’ve just made a massive spend. 

When the CFO says, “Hey, we just made this great investment. How did it go?” and the answer is “Great!” and you say, “How do you know it went great?” it’s like, “Because we have a better brand now. And we have a great new website. Look!” 

That’s the issue. Lots of times, you run into things like vanity metrics that we don’t want to use. Are you actually making the conversions? Are you actually getting the revenue? Are you actually progressing deals? These are the things that we want to see. These are the things that we want to hear about. I don’t want to hear about impressions, necessarily, unless impressions lead to something that I care about as a CFO.

Drew Neisser: It’s funny, I wanted to get there. That was going to be my next question because in the earlier part of the conversation that was tell me what measures that you think are going to come out of this bet. 

When we talked it was, what if the CMO doesn’t give you a metric that you believe in? And how do you get to that common agreement? We’re going to make this bet, we’re going to do ABM, we think that ABM is going to help us move a small group of people through pipeline, I don’t know. But I don’t know what measures you actually put there. 

With your CFO hat on, is it anything close to revenue sounds like a good metric?

John Evarts: I’ll put it this way. The closer you get to revenue—and in our case, ARR, it depends on the business—the closer you get to that metric, the more likely I am to say, “Yeah, that makes sense.” 

The further you get, the more likely I am to be like, “Huh, I kind of don’t get it. I need a little bit more, or I need a little bit different. Educate me. Let me sync with you because I don’t quite understand that piece.”

Drew Neisser: Right. And have you gotten into any sort of complex attribution modeling? Because some of these things are tricky. And again, I know that I’ve mentioned the Forrester thing and we’re going to talk about metrics and it’s unacceptable for a CMO to say, “Well, you can’t measure that.” 

They can’t do that anymore. But how close have you gotten to any of these multi touch attributions saying, “Well, it’s going to be these things and we’re eventually going to be revenue down here.”

John Evarts: Has anyone really done it well, is my question. Like, that’s hard. It’s so hard. And, you know, struggle is real kind of thing. This is something we all deal with, and we deal with it regularly. 

Talking about comp models and double comping and credits and like, how do you make more investments if you don’t know whether or not they’ve touched and all that sort of stuff? It’s really hard. 

Attribution is—and I think actually, Isabelle did a good job of framing, right? That’s the Holy Grail. That’s what I think a lot of people are looking for: What are the metrics from an attribution perspective that say, “Yes, this thing is working”? I think right now, in this unique moment in time, we have so much data but it’s really hard to understand and frame that data in a way that speaks to both finance and to marketing.

Drew Neisser: Right. When we spoke last time, you mentioned that when you became COO, you suddenly looked at marketing differently. I just wondered if you could share what that perspective was. Moving from CFO to COO, what changed, in your mind?

John Evarts: It’s hard, right? I mean, fundamentally, when I looked at marketing prior, you would look at, “Okay, how much does it cost, how many FTEs do we need, etc., etc.” 

The difficulty is—and historically, we haven’t had as much data as we do right now. And so, as a result, it’s really difficult to say, “Yes, marketing is incredibly valuable and if I add 20% to the budget in marketing, we are going to get more than 20% from that.” Really hard to establish. 

We have more opportunity now. Now, in my role as COO, it’s a lot different because I see both the resource allocation and how we spend, where we spend, and why. A lot of times, I never had the opportunity to have education and partnership with the CMO in my CFO historic roles. 

Drew Neisser: Interesting. 

John Evarts: And so that education is so critical. That needs to happen because you understand, like, the CFO often has to be one of the smartest people in the room. And so, it’s hard as the CFO, when you’re looked at as the cop and you’re looked at as the smarty pants in the room, you need to be able to make calls. 

It is easy to cut discretionary budget. You’ve heard that term before, right? “Marketing is discretionary. You just do a few more events!” That is not how we should be looking at it and now that I understand more, I understand early, mid stage, late stage. What should be done. 

Sales support, how does that work? Air cover, what do you need? ABM, why is that working? Digital spend. Those are the pieces that when you understand inbound, outbound partnerships, you have all of those understandings, all of those levers, you now have a much clearer picture on why optimizing that spend is so critical and cutting it is so bad. But until you get the data and until you’re educated, the CFO is helpless. That is the issue.

Drew Neisser: So, there is the strategy, folks, that you really need to think about now. This is it. This is the gold mine, which is, your job is to educate your CFO so they can become COO and CEO. You are going to make their career because you’re going to help them understand how marketing really impacts the business. John, thank you so much. This is really, really helpful. I appreciate you being here. 

I learned a lot today. I mean, I think the key takeaways… Building trust with your CFO starts with your commitment to understand the finances of the company. It means creating tests with measurable outcomes and being transparent about what works and doesn’t. 

Ideally, it’s about creating a dashboard that you can agree that measures the full impact of your marketing programs in the three buckets that Forrester shared: marketing efficacy, brand equity, and financial value. All right, before we go, I want to thank our special guests Chris Andersen, Nicole Anasenes, and John Evarts. 

Show Credits

Renegade Marketers Unite is written and directed by Drew Neisser. Audio production is by Sam Beck. The show notes are written by Melissa Caffrey. The music is by the amazing Burns Twins and the intro voiceover is Linda Cornelius. To find the transcripts of all episodes, suggest future guests, or learn more about quite possibly the best B2B marketing agency in New York City, visit renegade.com. And until next time, keep those Renegade Thinking Caps on and strong.

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