Unlocking brand ROI: Gaining alignment with your CFO on the power of brand

A strong brand is more than just a logo or a tagline—it’s a vital asset that can drive growth, customer loyalty, and long-term profitability. However, convincing your Chief Financial Officer (CFO) to allocate substantial resources to brand-building activities can be challenging. CFOs are typically focused on numbers, cost control, and immediate returns on investment (ROI). To secure their buy-in, it’s crucial to present a compelling case that connects brand investment directly to financial outcomes. Here’s how you can effectively provide your CFO with the information they need on the benefits of investing in your brand.

1. Start with the Basics: Define Brand Investment

Before diving into the numbers, it’s essential to clarify what brand investment entails. Brand investment goes beyond traditional advertising and includes any effort that enhances the perception, recognition, and emotional connection of your brand with its audience. This can involve:

• Brand identity: Logo design, brand colors, and overall visual identity.

• Customer experience: Consistent and positive interactions across all touchpoints.

• Content marketing: Creating valuable content that positions your brand as a thought leader.

• Employee engagement: Ensuring employees are aligned with the brand values and act as brand ambassadors.

If they don’t already, help your CFO understand that brand investment is not just about marketing spend but about building long-term equity that will yield dividends over time.

2. Align Brand Investment with Business Objectives

CFOs are naturally focused on aligning investments with the company’s strategic goals. To gain their support, demonstrate how brand investment aligns with and supports these objectives. For instance:

• Revenue growth: A strong brand can command premium pricing, leading to higher margins and increased revenue.

• Customer retention: Brands that foster loyalty reduce churn rates, which can be far more cost-effective than acquiring new customers.

• Market expansion: A recognised and trusted brand can facilitate entry into new markets and categories with less risk.

Presenting brand investment as a strategic enabler rather than a cost center will help your CFO to understand that you see the bigger picture.

3. Leverage Data and Analytics

CFOs value data. To convince them of the value of brand investment, you need to speak their language—metrics, numbers, and evidence. Use data to show how brand strength correlates with financial performance. Some key metrics to highlight include:

• Brand equity scores: Tools like BrandZ or Interbrand’s Best Global Brands can help quantify brand equity and show its impact on stock prices. Useful tools if you manage a large global brand, perhaps not so if a smaller one.

• Customer Lifetime Value (CLV): Demonstrate how brand loyalty increases CLV, reducing the need for continuous high-spend customer acquisition campaigns.

• Return on Marketing Investment (ROMI): Show historical data on how marketing efforts have improved key performance indicators like market share, sales, or customer retention.

If possible, use case studies from similar companies or industries where brand investment led to measurable financial success. This approach is likely resonate, it demonstrates you’ve done your research and have a strong investment case.

4. Emphasise long-term value

CFOs often focus on short-term financial metrics, but brand investment is a long-term play. To address this, you should emphasise the concept of brand equity as an intangible asset that appreciates over time. Point out that companies with strong brands—like Apple, Coca-Cola, and Nike—enjoy sustainable competitive advantages, making them less vulnerable to market fluctuations and more resilient in economic downturns. Balancing short term gains and long-term growth is essential.

Discuss the concept of brand equity as a form of “goodwill” on the balance sheet, which can enhance the company’s valuation in the eyes of investors. Explain how consistent brand investment can lead to increased shareholder value by driving customer preference and loyalty, which in turn, leads to more stable and predictable revenue streams.

5. Highlight the risks of not investing

Sometimes, it’s not enough to talk about the benefits—you also need to discuss the risks. Illustrate the potential consequences of under-investing in your brand:

• Erosion of market position: Competitors who invest in their brands can capture market share, leaving your company vulnerable.

• Increased customer acquisition costs: Without a strong brand, attracting new customers becomes more expensive, as your company may need to rely on discounts and promotions.

• Lower employee morale: A weak brand can affect employee engagement and retention, leading to higher recruitment and training costs.

By presenting these risks, you make a compelling case that maintaining a strong brand isn’t just beneficial—it’s essential.

6. Collaborate on financial models

To bridge the gap between marketing and finance, collaborate with your CFO on building financial models that project the ROI of brand investment. Work together to develop scenarios that show the potential impact of brand initiatives on key financial metrics like revenue growth, profit margins, and shareholder value.

Consider using a phased approach, where you start with smaller, measurable brand investments and track their impact over time. This allows your CFO to see the tangible results of brand-building activities and feel more comfortable scaling up the investment.

7. Showcase Internal and External Support

Finally, build internal and external support for brand investment. Highlight endorsements from other C-suite executives, who understand the strategic importance of branding. Additionally, share insights from industry analysts, customer feedback, and market research that reinforce the value of a strong brand.

Aligning with your CFO on the value of brand investment requires a thoughtful approach that connects branding efforts to financial performance. By defining what brand investment entails, aligning it with business objectives, leveraging data, emphasising long-term value, highlighting risks, collaborating on financial models, and showcasing support, you can make a persuasive case. Remember, the goal is to demonstrate that brand investment is not just a cost but a strategic lever for driving sustainable growth and profitability.