Escape Zoom: Does your ad sales team speak CFO lingo? Insight from City AM’s Analyst of the Year, Ian Whittaker

Henry Ford once said that “stopping advertising to save money is like stopping a watch to save time”. Advertising is a key driver of growth for all types of businesses – even when times are tough – however during times of economic uncertainty those in charge of financial operations tend to look at advertising expenditure with an increasingly critical eye. 

As we navigate further into the new normal and adjust to a challenging economic backdrop, it’s important to remember who holds the purse strings, and carefully consider how best to talk to them. 

In our latest Escape Zoom, Propeller Group founder Martin Loat invited a very special guest; City AM’s Analyst of the Year, Ian Whittaker. Settling down in a Zoom full of attentive industry leaders, Ian shared his perspective on how ad sales teams can best speak CFO.


Amidst some management consultancy work, I’ve spent the majority of the last twenty years working as a City Analyst, looking at media, digital and all the sub-sectors in between. Through this time the media landscape has twisted, turned, shifted and fragmented, but one challenge has remained ever-present: speaking the language of a CFO. Here are my three key factors to consider when engaging with these key stakeholders. 

Start with the big picture

As with any type of communication – context is everything. So the most important device for framing how you interact with a CFO should be a clear understanding of the macroeconomic picture. And the macroeconomic picture right now is one of considerable uncertainty. 

The latest forecast from the Office of Budget Responsibility is that unemployment will peak later this year at close to 12%. Despite this, it seems like Q2 will be the nadir of the crisis for many businesses. From an advertising perspective, there was even the sense that Q2 was not as bad as was initially feared. 

There has naturally been much speculation about what ‘shape’ the economic recovery will take – with many hoping it would be a ‘V’ shaped bounceback in the latter quarters of 2020. And for some businesses it might. The most accurate depiction of the recovery came from S4 Capital who anticipate a ‘K’ shaped recovery – where some sectors will bounce back very quickly – but others will face difficulties for a significant amount of time. 

Understanding their priorities

Firms are using the crisis to accelerate deep-rooted structural changes to their businesses and cost bases. The comments of Microsoft’s CEO that two years digital transformation has happened in two months look, if anything, too cautious. Job cuts are happening – the likes Royal Mail, Centrica – and automation is continuing to be pushed through. We could well see a replication of the automotion which took blue collar jobs in the 80s, coming for white collar jobs today. 

If you look at CFOs themselves, the immediate focus is cost cutting. Deloitte’s Q2 survey found that for 61% of CFOs, reducing cost was a priority – while 52% referenced improving the cash flow. Only 26% talked about the introduction of new products and services. These figures show the focus is still very much on tight cost control.  

Particularly for publicly listed companies, you need to understand how advertising is treated in terms of a company’s accounts. Typically advertising is expensed through the P&L – whilst capital expenditure items go through the cash-flow line and are then depreciated. 

For analysts and investors, the most important line in any company’s accounts tends to be the P&L. Advertising needs to be viewed – and pitched – to CFOs as intangible capital expenditure. Just as you invest in a factory to build a product, you invest in advertising to build your brand. Both are essential to achieving long term growth. 

Knowing their triggers

Generally speaking, CFOs will almost invariably come from an accounting background – meaning you have an individual who is disciplined in facts, specifics and numbers. Ad sales teams need to be able to speak this language and demonstrate thorough analysis and hard results. 

There is potentially an opportunity for a disconnect here. What the marketing team may view as hard analysis, may not quite tally with a CFOs view. These figures need to be delivered in a way that senior financial stakeholders will acknowledge and respect. 

Another important factor to consider when dealing with any CFO or CEO is that problems flow downwards. CMOs are under pressure from their CFO and CEO, whilst the CEO and CFO are under pressure from their board – who are in turn under pressure from their shareholders. You need to give the CFO and the CEO the hard ammunition they need to fight your corner and justify your investment. 

This is obviously easier for some mediums than it is for others. Advertising is naturally soft and intangible – it is difficult for magazines, or radio, or out of home to show the  unquestionable concrete figures a CFO may demand. And this is likely a key factor in the growth of digital over the last decade. 

It’s also important to remember the human side of all this. A CFO may feel unable to present the case for an expensive TV campaign or niche magazine ad as, quite simply, it makes them seem out of touch.  ‘Old media’ needs to find a way to circumvent this social-barrier by delivering indisputable figures that can cement their value. 

All of this stems back to a much bigger, much more subtle change in marketing and advertising, which is the increase in private equity ownership of assets. Private equity businesses are much more focused on metrics which can protect shareholder value. Ad sales teams need to understand what types of numbers resonate here – as Marc Pritchard has successfully shown with his repositioning of P&G.

In summary I find that perception is key. Ad sales teams need to understand how their media is perceived, how a CFO will perceive their numbers – and how the CFO will be perceived fighting their case upwards. Ultimately, the best ammunition you can use is language that speaks to their concerns – and numbers that ease them. 

For more information on the Escape Zoom series or Propeller Group’s services, drop us a note at info@propellergroup.com