How CFOs and CMOs can team up to drive long-term growth
Good morning. Some modern CFOs now view marketing as a growth center rather than a cost center. Yet, despite this shift in mindset, marketing is still taking a back seat at many companies, squeezed by trade tensions, economic uncertainty, and cautious consumer spending.
New research from McKinsey highlights the evolving role of the chief marketing officer (CMO) and argues that better alignment between the CMO, CEO, and CFO is key to finding new growth opportunities. However, achieving this alignment is easier said than done. When accountability for the customer is unclear and everyone in the C-suite is responsible for growth, often no one truly is.
McKinsey’s analysis of Fortune 500 executive teams, based on publicly available data, reveals a telling trend: companies with a single customer- or growth-focused executive, such as a CMO, grow up to 2.3 times faster than companies with multiple roles sharing those responsibilities.
But simply appointing a CMO isn’t enough. “Pull the CMO back to the center, have them align with the CFO, and get everyone moving in the same direction,” McKinsey recommends. Without clear ownership and support, even the most talented CMO can’t deliver their full potential.
Despite its strategic importance, marketing is often sidelined. According to Spencer Stuart, the percentage of Fortune 500 companies with a CMO dropped from 71% in 2023 to just 66% in 2024.
One challenge: CMOs often struggle to clearly communicate the value and costs of marketing to their finance counterparts. The most successful marketing organizations use sophisticated systems and agreed-upon KPIs to demonstrate the financial impact of their investments, McKinsey finds. This data-driven approach helps get CFOs on board.
Retail is one sector where this alignment is increasingly evident. Ulta Beauty CFO Paula Oyibo, for example, recently told me that the company’s partnership with Beyoncé’s Cécred hair care line is a natural fit—highlighting how marketing and partnerships can drive growth.
Similarly, Mandy Fields, CFO of e.l.f. Beauty, believes in the power of collaboration between finance and marketing. “Oftentimes they’re at odds because finance looks at marketing as an expense,” she told me. “We have taken a different approach, seeing marketing as a sales driver, and that has proven to work for us.” For the full year 2024, e.l.f. Beauty delivered 28% sales growth and a 26% increase in adjusted EBITDA.
Kory Marchisotto, chief marketing officer at e.l.f. Beauty, recently told me that from the first day she and Fields met, “we just knew that, whatever was going to happen around us, there was this common respect and admiration for each other’s career.”
As McKinsey puts it, for growth strategies to succeed, C-suite leaders must truly view marketing as a strategic function.
Have a good weekend. See you on Monday.
Sheryl Estrada
sheryl.estrada@fortune.com
This story was originally featured on Fortune.com