Finance forms the backbone of any business activity and marketing is no exception. Just like bread and butter, marketing and finance go hand in hand. The growth, expansion and all decision-making activities impact and influence one another. In a similar vein, the impact of financial decisions is visible in marketing decisions and vice versa. As competition increases, every company irrespective of its size or scale of operations must invest in some marketing activity that will create value in the long term.
A sound marketing strategy helps in generating goodwill for your brand which in turn results in higher market share. With the help of a focused marketing strategy, a company can enjoy a high level of customer satisfaction, good CSR benefits, rapid innovation, greater brand equity, excellent financial performance year on year, reduced cost of debt and even a higher stock return. So instead of thinking about marketing as an expense or sunk cost, think of it as an investment which will give exponential returns for your brand.
From a financial perspective, a good marketing strategy is comprised of several factors like budgeting, pricing and margins, forecasting and decision making. Budget being the cornerstone forms the foundation upon which the entire strategy rests. Just like any department in an organisation, the marketing department will have to work under the budget provided as it will help the organisation to not only control costs but also optimise profits.
Once a budget has been allocated, it is imperative to closely monitor the flow of funds and ensure that the budget is being used in an optimal manner. This will provide a path upon which the company can move ahead. During the course of the marketing activities, one can review the various streams of income and make modifications to the budget as required.