But I really disagree...
As a point of fact, Lewnes is among many in a list of people who have said this. My quick (certainly not comprehensive) search finds that the first appearance goes back at least a couple of years, to the Summer of 2007. Hal Varian, the Chief Economist for Google is the first that I can find that said it in a Wall Street Journal interview. And, to be specific, his reference was to the burgeoning amount of data made available to marketers by technology - which he was likening to the late 60's and 70's when the practice of modern Finance came unto its own.
Lately, a few others have followed up on Varian's quote, including Guy Phillipson, CEO of the Internet Advertising Bureau (not to be confused with the Interactive Advertising Bureau) - other bloggers, and then notably Lewnes.
So, while I think the original sentiment of this phrase - that new data and technology is helping the practice of marketing to become more scientific than it was (most certainly), I'm also seeing it become dangerously over-simplified, where some are even reducing it to the function of corporate departments.
In short, as this excellent article from Wharton points out, looking at marketing as a series of short-term investments is a mistake. And an oversimplified application of the "marketing is the new finance" statement is running down this road. Saying that you can reduce the practice of marketing down to a series of algorithmic functions of probability is a sure path to, at least, mediocrity if not failure.
Measurement Is Like A Box Of Chocolates...
Certainly, there's no argument that marketing can be held more accountable these days, and that measurement technology related to online marketing is the result of that. But using that as the basis of saying that "marketing is the new finance" is the equivalent of saying that because we have the technology to know who and how many people watch television shows, we should be able to make the perfect TV show that will be number 1 and everyone will love.
Further, it is not the job of Finance to take numbers and use them to make the financial strategy more creative (I'll resist the overwhelming urge for a Wall Street joke here). Finance's job is to accurately track, interpret and report the cost/spend numbers delivered by the functional departments in the organization. Then, of course, they are charged to make strategic recommendations (from a financial perspective) on how to make corporate investments sound. Now, that may sound like a semantic argument - but I believe that, subtle as it may be, it's an important distinction.
Here's that distinction: When determining ROI and the plan for moving forward, Finance looks and asks the question "what did we get back from our investment?" As marketers, when we focus on ROI, measurability and our plan, it is NOT simply asking "what did we get back?" It is rather - "how does this measurement improve or change our creative efforts going forward and how might it affect other elements such as retention or brand value". In other words, we sometimes decide or are forced to make counter-intuitive decisions based on measurement results. These are decisions that would normally fly in the face of a purely algorithmic recommendation.
In short, marketing measurement technology is like a box of chocolates. Sometimes, you get something different than what was promised - and sometimes the result just doesn't fit with what you're taste is. Put simply, sometimes the best performing ad creative is counter to your brand strategy, and you have to make a painful decision to put that chocolate back in the box.
Data Doesn't Convert Customers - Creative Does.
The data itself doesn't make us "more creative" or "better" marketers - it only delivers the ability to provide us the insight to change our process.
We certainly want to understand how and why a particular marketing strategy works or doesn't work. But that often means irrationally "shaking things up" and trying a brand new piece of creative. Or, moving to a completely different marketing strategy despite our numerical success because of external market conditions.
In other words, a Marketer's job is to go out and "make something happen". We are blessed and cursed with being the role that is charged with creating something from nothing. We are charged with taking an idea (a product or service) and creating a communication strategy that helps us convince other people that they need it. We are *always* looking forward and are constantly working to conjure the "magic" that exponentially increases our sales.
When we are our most successful, we have not shaved 10% off of our spend - we have increased sales inquiries by 200%. We're focused on ALL that our creative content and strategy provides - new sales, customer retention and market awareness. And, to the extent that we are looking back - it is only to understand and gain insight about the creative process to gain speed and momentum in moving forward.
In my mind, that is really really really not Finance. And because I used three "really's" there you know it must be true.
Every Department Is The New Marketing
I think the more apropos opportunity that exists is to balance the art and science - and align ourselves with Finance in a way that's never been possible before. Done correctly, a marketing group delivers creativity AND a much more aligned set of numbers that helps Finance in providing strategic insight and a "no surprises" set of books for the CEO. So, rather than marketing being the new finance, I'd go with another hyperbole that turns that on its head: Every department is the new marketing.
Three thoughts here:
1. Marketing Should Be Treated Like The Entire Business
Everyone in the business can be involved with marketing these days, and as such marketers have more expectations put upon them. And everyone in the organization should be focused on how the entire organization can expand creatively, communicate clearly, manage risk, improve our process and be financially accountable. CMO's are, in short, business owners - and we need to plan and work on every aspect of the business. New types of measurement are entering our dashboards. We should absolutely turn our attention to financially based tactic-level measurement such as Average Cost Per Lead, Cost Per Customer, Lifetime Value of Customer and Marketing Spend vs. Revenue as a ratio.
But marketing doesn't and shouldn't purely align to Finance - rather the two teams should align together. Just because these are financial ratios and math doesn't mean the finance people know the answer. Guess what? They don't. It's working together as a team and determining what's right for your business that determines how success will be defined.
2. Marketing Is Messy - And Colin Powell's Rule P=40 to 70 Applies Here
So, if you want a formula, here's a good one which comes from Colin Powell. By the way, on the off chance you haven't seen his rules for leadership - they are absolutely fantastic.
Marketing decisions live and succeed by Powell's P=40 to 70 rule in which P stands for probability of success and the numbers indicate the percentage of information acquired. Powell's advice here is that below 40 you shouldn't take action, but anything in the 40 to 70 range indicates the decision - and the rest should come from your gut.
This is a hard thing to try and do as you align yourself with some Finance departments. As you build a business case for adding budget to your marketing programs, you've got to be able to make a strategic, ROI based argument. That's incumbent upon you as a "business owner". But, again, this doesn't mean that marketing has to purely align with Finance's need for 100% accuracy in forecasting. Marketing is much messier than that, and a certain amount of budget needs to be allocated for things like "gut instincts", "experiments" and "hail mary's". If you don't - you may not ever fail - but you'll almost certainly be trapped in mediocrity.
3. We Actually Do Need To Develop Predictable Metrics
Having said all this, we marketers absolutely do need to shore up our strategy - and perform more like a holistically focused business unit. We absolutely need to focus and improve our analytical and quantitative skills. We must equally embrace the science of CPC, CPA, A/B, Multivariate Testing and algorithmic examinations of our SEO focused content as well as our focus on how much white space the logo needs.
But to be clear, these data must be focused on how we improve our process rather than something we prove to Finance or other teams. The accountability that marketing now has should first and foremost be to itself. Data gives us insight, that helps us improve. It is our creativity and our content that drives exponential success.
Finance can help the marketer by helping drive that insight. They can assist the marketer by helping to drive realistic financial models and metrics that feed other parts of the business. Engaging finance as the separate and wonderfully complex science that it is - will help marketing to stay the separate and wonderfully complex balance of art and science that it is.
And, at the end of the day - isn't that what we really want?
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