Doom, gloom and behavioural economics: How to address CFO needs

Accountants have come out of the back office and shut the door behind them.

In most businesses, the CFO is now as involved in company strategy as they are in corporate reporting. Newly qualified accountants, meanwhile, say they are happier experimenting with blockchain and developing new business models than they are running calculations through Excel.

Finance teams are increasing their influence, and all sorts of companies are directing their marketing efforts at them. A growing number are doing so through insight-led thought leadership.

Marketers want to produce content that’s immediately relevant to that CFO and finance audience, but also stands out from everything that has been developed for the same purpose. That isn’t easy at the best of times, and it’s extremely difficult in an economic crisis. Finance executives have even less time to read thought leadership: many are under pressure, every day, to simply keep the lights on.

So how can marketers create thought leadership that captures the finance imagination? One suggestion I have is to borrow an idea from behavioural economics: loss aversion.

Loss aversion was developed by Amos Tversky and Daniel Kahneman, and it’s used to explain why consumers don’t always behave in the dispassionate, rational way that economists expect. More specifically, it suggests that they hate losing even more than they love winning. People will, for example, go out of their way to avoid losing out on a limited-time £10 discount; they’re less likely to go to the same trouble if the pay-off is the chance to win a £10 gift voucher. The fear of loss is an extremely powerful motivator.

If you apply the principle of loss aversion to thought leadership, you can create viewpoints that appeal to your audience on a visceral level.

Straight to the fear circuit

Marketers have, for the reasons sketched out at the beginning of this article, produced plenty of upbeat thought leadership about the evolving finance function and its opportunities. It’s true, for example, that finance executives are playing an instrumental role in the business and are influencing its strategic direction.

But upbeat sentiments have their limitations. Yes, your audience is going to be interested in what they might be able to gain in their professional lives, but they will be absolutely obsessed with what they stand to lose.

If the CFO is second only to the CEO in the executive hierarchy, is the rest of the C-suite pleased for them – or envious? If the CFO happens to make a blunder relating to strategic investment in new technology, why shouldn’t the CTO or CDO, with their backgrounds in advanced analytics and digital disruption, not rise in prominence? And, even worse, as traditional finance processes are increasingly automated by robotic process automation (RPA), what’s stopping the COO from suggesting that the company might become more profitable if the function were dismantled altogether?

These are the sorts of questions that will be preying on the minds of your finance audience. They’ll be interested in what you have to say about them.

We’ve compiled some of the questions your finance audience will be asking itself during the Covid-19 pandemic and after it has passed so you can map out your own set of CFO needs.

Can you answer them? Download the infographic here.

Make yourself useful

The value of any thought leadership, no matter what form it takes, often comes down to the practical guidance it contains. In the current economic climate, that advice is going to be valued more than ever.

If you have made a strong case that finance will lose out if it doesn’t change its ways, then you need to set out clearly and credibly what actions it should take to avoid disaster. It’s no good describing a problem and then letting your reader find the solution from one of your competitors – you need to demonstrate why your business is useful.

This doesn’t mean, of course, that you give away all your intellectual property and undermine your business model. But neither should you simply roll out a list of vague recommendations that are obvious to anyone. If you’re making a bold statement about a profession, then you need to provide solid advice backed up by evidence and experience.

But don’t go overboard

I’m not suggesting that all thought leadership needs to be alarmist. Just as there is a limit to the number of upbeat articles you can write about an emerging opportunity, there is only so much that anyone wants to read about a looming catastrophe.

At worst, overly bleak narratives also show a lack of imagination: it’s much easier to be depressing than it is to be inspirational. Still, if you want to stand out, then it’s worth experimenting with tone and being realistic about what could go wrong. And if you successfully alert someone to a very real and overlooked danger, they will have a very good reason to feel warmly about your brand in the future.

The Thought Leadership Network’s recent webinar on brand messaging in a crisis, discusses with the help of expert voices from Accenture and the Financial Times, how to balance messaging during the pandemic and after it settles. Watch on-demand here and to sign up for the next in the series to be held on 30th July, click here.