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Secrets for FP&A Teams from a Market Researcher

Key Takeaways

Kelly Davis of Outdoor Industry Association returns! The podcast crew interrupts Kelly’s time with her dogs to ask how market researchers can be a financial planning and analysis (FP&A) team’s best friend.

Season 4, Episode 9: Secrets for FP&A Teams from a Market Researcher | Transcript


Kelly Davis: One of the things that I deal with on a daily basis is understanding which variables are important and which variables are not. 

Steve Soter: Hello and welcome to Off the Books where we surf the uncharted waters of accounting, finance, risk, and wherever else the waves take us. This episode is brought to you by Workiva, the risk reporting, ESG, and compliance platform that simplifies your complex work so you can sit back, relax, and enjoy your night. Check it out at My name is Steve Soter, accounting enthusiast and Diet Coke aficionado. I'm looking forward to debiting a great conversation, and I'm so happy to have you with us. I'm also very happy to have Catherine Tsai joining me. Catherine, can you please tell the fine folks who you are? 

Catherine Tsai: I'm not an accountant or Diet Coke aficionado, but I like asking questions and learning new things, so I'm here to learn. 

Steve: Catherine, I nearly chuckled because I called you by your rapper name, but I didn't cause I caught myself. Catherine, what do you want to learn this week? 

Catherine: Well, remember when we had Kelly Davis on the show last season

Steve: Indeed I do, from the Outdoor Industry Association.

Catherine: Yes, she is their Director of Research. And what I remember, besides the fact that she rides an e-longboard and used to be a snow reporter, is that her background is in market research. But in a few of her roles, she says she has worked directly with the chief financial officer in the office of the CFO.

Steve: Well, and it's interesting because you and I were actually talking about if you have all this great market research, how does that actually translate back into FP&A and CFOs and what exactly they would be doing with that information?

Catherine: Yes. And it seems like Kelly would have a unique perspective on that. So we're happy to have her back on the show.

Steve: Well, Kelly, welcome. We are so glad to have you.

Kelly: I am really happy to be here. I just love talking to you. This is great.

Catherine: I'm glad you're back. And just to refresh the listeners, can you tell us a little bit about how you have worked with CFOs and finance teams before?

Kelly: Sure. You know, I've been the Director of Research for a number of different trade associations and companies over the years. Several of the companies that I worked for, including WarRoom Research was one of them, where I worked directly with the CFO, and the Aircraft Owners and Pilots Association is another example of a trade association that I worked for in which I worked directly with the CFO, actually directly for the CFO.

Catherine: How critical is it for market research to be incorporated into anticipating what trends will be?

Kelly: Well, one of the things that I think is critical is just a second check on business intelligence. Now, being able to look at that data and put it through a sniff test and understand the context in which your company or your organization, whatever form it might take, is operating in its current environment. And that means, you know, if you've got some anomalies in the data, you want to check those against what's happening across the industry.

And you really want to understand what other variables are affecting your business both in the past and in the future. You have to be able to project what trends look like. And in order to do that, you have to understand what's going on in the world. And that's where research comes in. I mean, we're not necessarily producing BI (business intelligence) internally—that's something that your data analytics team probably does. But what we can do is provide you with that context for how the organization is operating in the larger context of the industry and in the market. 

Steve: Kelly, is there an example that you could walk through with us? Think about online retail. We talked about outdoor goods and products, and I was involved in that. And we were online, so I know that if we increased our marketing spend for banner ads in other places, you would think revenue was going to go up. That's relatively simple. But you have a bad winter, for example, and that could be potentially devastating, not that we have to use that as an example. But I'm wondering if you could maybe make it more concrete for things you know are going to happen in the business because you're making intentional decisions versus these other global or market trends that are also going to have an impact. How does that play out?

Kelly: I like that you that you brought up online. So imagine you're a company that's deciding where to direct your marketing budget and you're doing about 40% of your business direct to consumer—online—and about 60% of your business through specialty retail. Now, imagine that you've got a business intelligence specialist, or you are one yourself as a CFO, and you're talking to the research director who can tell you that based on data that they're collecting, online shoppers in your industry are planning to buy 60% of their product online in the coming 12 months. Now, based on past data, you're going to project for 40%. Do you want to project for 40%, or do you want to think about the 60% who are planning on buying online and project to that? That's sort of a simplistic situation, but just imagine that in more and more detail as you try to understand what your consumers are planning on doing and building your financial projections to match those trends rather than simply relying on past data. And frankly, right now we only have about six months of past data that's actually worth anything in terms of predicting future behavior simply because of the pandemic and the situation in which we went through absolutely disrupted what was going on with with consumer behavior for the past, say, three years.

Steve: That's really interesting. So you're telling me that we hit "normal"—I say that in air quotes—six months ago, that the consensus was in March of 2022, we think we're kind of back to steady state or what it will look like in the future. Is that right?

Kelly: Yeah, and if only everybody agreed that it was six months ago and that there was a clear dividing line. Right now we're still in limbo. We can't decide whether or not we're in or out or we're in an endemic phase or we're still calling it the pandemic. You know, we've got to consider the new variables that are popping up around the world and and their potential to disrupt the holidays in terms of travel and in terms of shopping. So, yeah, there are other things that we need to consider when we think about whether or not we're in the new normal or not. I think things are starting to sort of smooth out, especially in areas like workforce. Now, what will the younger worker expect, and how does that change the way people work and recreate? That's why I'm most interested in that.

There are a lot of trends that are emerging, and you know, we've got to keep our eyes and ears on them to make sure that we're tapping into the dynamic nature of trends as we move out of this period, because some could be temporary and just sort of whirlwind out. And we've got to keep our eye on that, especially, you know, when it comes to workforce. We had a period in which media was presenting the idea that everybody was going to go back into work and that we sort of accepted that for a week or two and then didn't accept it. So we've kind of have to work through the information and see how things play out. And I'm sorry about my dog. You might have to stop recording for 1 minute. I'm sorry, man. She's just going to bark. 

Steve: It was very apropos. Well, maybe this might be a great time to break for a commercial for a quick word from our sponsor. 

Mike Gravagno: Dear listener, this is Off the Books Producer Mike Gravagno. And while we wait for Kelly, I have some exciting news about our sister show, ESG Talk. Just in time for the holidays, Steve will be joining Mandi along with Andie Wood over on ESG Talk. They'll be providing a regulatory recap on environmental, social, and governance matters and looking ahead to 2023. You can find ESG Talk at, or go to the Workiva channel on YouTube. Look for the episode with Steve Soter and Andie Wood coming up. OK. I think Kelly's got her dogs rounded up. Let's go back to Steve and Catherine, who are talking with Kelly Davis of the Outdoor Industry Association. 

Steve: And now we are back...

Kelly: Excellent 

Steve: ...talking with Kelly Davis. 

Kelly: Without the dogs. Thank you. 

Catherine: Well, Kelly, what kind of data sources do you use to figure out what these emerging trends are going to be? 

Kelly: Well, you know, anything I can get my hands on, Catherine. Right now in Outdoor, I'm pretty excited about a new data source that I'm using called CivicScience. And what they do is they work with media—syndicated media and others—to get hundreds of thousands of responses to consumer intelligence surveys. So when I'm thinking about shopping behavior, that's where I'm getting this data from. But what you need is the voice of the consumer, and you need to understand what the consumers in your market are saying, and whether those consumers are actual employees or they're people that are buying products and services from your organization, you have to know what's going on with them. You have to understand their world. 

Steve: You know, actually, one of the questions that I have about that data, because I'm thinking about the conversation with the CFO, the hypothetical conversation where you had brought up that 40% versus 60%. Well, wouldn't I want to be using the correct number, and I suppose that I would. How receptive do you find our CFOs to that? Like, if that would help me, if it would make my projections look better then, oh yeah, this data is great. Or if you come to me, bringing bad news, I'm like, well, I don't know, maybe you don't know as much as you might say. I mean, do you find that maybe they're more receptive to it based on how good the news is? 

Kelly: Sometimes? I mean, I've been the bearer of a lot of bad news. Usually when I have got bad news to bring you, I bring you donuts as well, so you associate me with the donuts and not with the bad news. Don't forget that they killed the guy that ran the first marathon because of the news he brought. Sometimes, you know, it's bringing the CFO bad news, and I have had to do that. I make sure that the best way to build credibility with the CFO and research is to be right most of the time and to build trust by admitting what the limitations of your analysis might be. So let's say that you did a survey and, I'll bring up the Aircraft Owners and Pilots Association again. So in order to understand what was going on with pilots, we can survey pilots pretty much all the time. We had 320,000 members who are pilots that we can talk to on a very frequent basis. And we can do it regionally or we can do it by certificate level. And, you know, we're thinking about what products and services to bring them. And some of the products and services that we were providing to pilots was not matching up with what they needed, and bringing that into the CFO's office and saying, "Hey, you know, this is where demand is." And at the same time, she was looking at where they were going to dose their resources for the organization and actually made a change in the way they're dosing resources by program based on what the customer was saying that they wanted. And that happens all the time. I mean, a lot of this data is collected from consumers by survey. If you're really getting into detail, you're doing discussion groups with the target audience. You're just trying to figure out what that voice of consumer wants and making sure that what you're providing them is answering those needs at the right time. So that's one of the best ways to use research to understand, you know, what you should do with your financial analysis in terms of where you're going to put your resources and vis-a-vis consumer demand. Otherwise, you're playing the game of if we build it, they will come. That's a dangerous game.

Steve: It seems like this could also be taken to its extreme where if maybe the finance team or the CFO was relying on and ingesting too much business intelligence. I mean, it seems like at some point that's like a no-limits fishing trip and you're just inundated with a ton of data that might be confusing or would make it really difficult to chart a path. And maybe you'll tell me otherwise that a really good CFO will be able to clearly see a path. But it feels like to me like, holy cow, you could really get caught up in this stuff. 

Kelly: Well, that's why you need a good research director, Steve. I mean, it's a big deal. One of the things that I deal with on a daily basis is understanding which variables are important and which variables are not. And that sometimes it's finding the signal in the noise. Sorry, Nate Silver, for stealing your line, but that's pretty much what data analysis on this level looks like. You are looking for the signal and the noise, and there are ways to do that that make a lot of sense and there are ways to do that that can confuse everyone. And I mean, a good market researcher will know how to do both if they need to. But if you've got a good relationship with your CFO, then both of you can work together to drill down to the level that you need to drill down to whether it's "OK, we've decided to do this and now we need to understand price elasticity in our customer group to "Let's find the specific customers that will say yes to this and beta test it." I mean it can go to that level or can stay at the level—well, I can probably play a game where I could convince you that the sky was falling in just about any situation. And that could cause you to misdiagnose where the market is and actually not dose your resources correctly and not maximize your revenue or maximize your membership or whatever you are trying to maximize at your bottom line. Yes, you can have a bad research director. That happens. And, you know, sometimes analyses are bad. That happens, too. So you want to have a group working together on this data to truly have a comprehensive picture of your world, of your market, of your consumer, and of your business and how it works to satisfy the needs of those consumers.

Catherine: It sounds like a market research team could have a lot of valuable insights for a financial planning and analysis team.

Kelly: Sometimes in finance I ended up having a lot of talks about finding out what's going on with people who aren't currently your customers or members or who aren't currently engaging in you who should, because often those teams get really short sighted and they only look at people who are already buying their stuff, right? Whether it's an idea or a product or service, those people are already engaged with the company, and so they have no idea what's going on with other customers who have said no to your product or service or who aren't aware of your product or service. And one thing that those teams need to know is the potential in those groups that they just have not seen or the trends that are going on in those groups that they have not seen. I mean, it's just a reminder. A good research team will remind finance teams to not be so myopic. I'm going to get a lot of hate for that. But, you know, the reminders to look outside and understand the world that you're operating in as well as the world inside your organization.

Steve: It feels like that's where—to your point earlier—a really good research director is able to see clearly sort of what the path is in order to help ground the CFO or the FP&A director or whomever to keep them focused on those areas that matter the most so they don't end up being inundated. 

Kelly: No doubt. I mean, if the two can work together well, it is an amazing partnership because both come to the table with very different skill sets and very different viewpoints. And to put this together is a pretty amazing thing because it automatically just enlarges your world and enlarges the amount of information you understand that relates to your company or your organization's product or service. It's a pretty powerful thing. It's like giving somebody a pair of glasses for the first time if they can't see. 

Steve: No, its quite apropos with me wearing my glasses today as we record. 

Kelly: And I've got mine. 

Steve: There you go. 

Catherine: Well, this is a question for either of you. How closely do market research teams and finance teams work in an organization, or does it depend on an organization's size or something else?

Kelly: Honestly, you know, it's dependent on for me, Catherine, is just the relationship I have with finance. You know, when research is included with finance, that tends to make the relationship better. It just does because you're just you're working together all the time, and so you understand each other's worlds a little bit better. Even if there's a little bit of friendly rivalry from time to time between the teams, it's still great to be working together. If you're in separate silos, that makes it that much harder. And that means that the research director and the CFO really have to intentionally embark upon the journey of that relationship, whatever that might look like for them. But at that point, it becomes just almost entirely dependent on the CFO and the research director's ability to develop a relationship with each other.

Steve: Well, Kelly, we are so glad that you came by again. It's always a pleasure to talk to you, so interesting. We can't let you leave, though, without giving us a scoop on what you see for this winter. We were chatting about that before we started recording, and I suspect that between the three of us, other listeners as well, are winter enthusiasts. So what do you see on the docket for this winter?

Kelly: Well, I think there's it's going to be a pretty decent snow year, which means, we're talking about a 140-day season. I think winter's going to start a little bit late everywhere, but I think there's going to be a little bit more snow, and it's going to be a little bit colder than average this year, especially above the Mason-Dixon line. And I don't know what the ski world is going to look like with, you know, the whole season pass thing is sort of taking over the ski world. And what it's looking like in the data is that you've got fewer skiers skiing more, and I'm super interested to see if that happens. So the idea is you buy your season pass, you invest that money upfront, which transfers the risk onto you versus the the resort who isn't sitting there waiting hungrily for you to walk up to their window and buy a $200 lift ticket. This means that you've already invested that money in a lot. The hypothesis is a lot of people just plan a ton of skiing, snowboarding, winter, outdoor stuff, etc. because they've already invested in this. So if you've invest in a season pass, use it, go as often as you can. And if you haven't, there there are all kinds of options for you, including, you can get multi-day passes, but overall the bottom line is going to be hard to buy a lift ticket if you just arrive at the resort and walk up to the window. Those days have passed us, I think, and this is the season we're going to find out all about that. But it's looking like it's going to be a good weather season. I'm personally excited to get back to apres-ski. You know, skiing is fun, but the apres is even better, right? That's where you can sit around after you ski and tell stories and talk about things like how research and finance interact. So I'm pretty excited about that culture. I think it's going to be awesome, and I think we're all going to find each other on the mountain somewhere this winter.

Steve: I love that.

Catherine: We have to.

Kelly: I hope so. I really am. I'm like a true believer. I love skiing. I love snowboarding. It's like flying on snow. It's awesome. 

Catherine: I can't wait. Are we allowed to ask you a closing question of the day in addition to asking you about ski season? 

Kelly: Sure!

Steve: You should. Well, you've got one that fits right with what she was saying. This is perfect.

Kelly: What do you got? 

Catherine: Yeah.

Steve: Well, no, I was just so one of our questions was what's your favorite beverage after a cold day skiing? I mean, we were just talking about that. What are the three of us going to be drinking? Well, I know what I'm going to be drinking. I would get in trouble if I said anything other than the thing that I, of course, would say. What are you and Catherine going to be drinking at the end of that day?

Kelly: Okay. I'm going to tell a really short story, but it's funny. I was in the Alps for the first time skiing. And you get to apres-ski, which you get to the mountain—the places that you hang out after you're done skiing open at 3:30. And by the way, they're halfway down the mountain. There are two choices. You can have schnapps or beer. That's it. And I was thinking, "Oh, schnapps, that'd be fun." And in Europe, schnapps isn't like a funny like yum that tastes like cinnamon or, ooh, peppermint schnapps. It's just gasoline with fruit in it, I swear to God. And so you drink about three of those because it's really fun and everybody's doing, you know, singing and things. And then you realize that you've got to ski down the rest of the way the mountain, which is, by the way, about 2,000 vertical, and there are no lights and you've had a bunch of schnapps. And that, my friends, is the most fun I've ever had on skis. It was hilarious. I want to do that again. So, schnapps.

Steve: There you go. Wow. Catherine, top that!

Catherine: Keeps you warm. I can't top it. I was going to say Baileys and coffee, but now I feel like I should say schnapps. Schnapps and anything.

Kelly: We can get a shot ski. You know, one of those long skis and do a schnapps shot together.

Steve: Well, you guys can be drinking schnapps. My sponsorship with Diet Coke is going to get really, really tough if I'm not drinking a DC at the end of that day.

Kelly: I'm drinking one now.

Steve: Well, Kelly, we're so glad you came by. Thank you so much.

Kelly: Thanks for having me on again.

Catherine: Thank you, dear listener, for surfing along with us. I'm Catherine Tsai. That was Steve Soter, and this has been Off the Books presented by Workiva. Please subscribe. Leave a review. Tell your buddies if you liked the show. What did you think of the episode? What should we have asked Kelly? If you're watching us on YouTube, drop us a note in the comments, or feel free to drop us a line at to tell us what you'd like to hear on upcoming episodes. Surf's up and we'll see you on the next wave. 

Mike: Hey there, dear listener. Mike Gravagno again, just popping in to let you know that we will be going on an extended break until about mid-January to spend time with families and friends and, you know, recoup. If you just need more Off the Books, feel free to dove into our wealthy back catalog. Surf's up and see you in the new year. 

Off the Books Season 4


Steve Soter, Catherine Tsai, Kelly Davis

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