What is a Fractional CMO?
Basic logic would suggest that the answer to “What is a Fractional CMO?” is essentially someone providing the same duties and responsibilities of a Chief Marketing Officer on a “fractional” basis – otherwise referred to as part-time, temporary, on-demand, or as-needed.
Therefore, let’s determine “What is a Chief Marketing Officer? A Chief Marketing Officer is the senior marketing executive in a corporation that is responsible for devising marketing strategies that achieve short and long-term corporate goals. They develop strategies and lead the charge to optimize brand perceived value, drive customer engagement, represent the voice of the customer, deliver a favorable customer experience, and manage public relations and communications.
In today’s digitally-driven business environment, CEOs expect much more than traditional brand awareness and advertising responsibilities from their CMOs. Today, the CMO is expected to be the growth driver, primarily responsible for generating revenues and developing growth strategies. In essence, the role of the Chief Marketing Officer (CMO) has expanded to also include Chief Growth Officer (CGO), Chief Revenue Officer (CRO), Chief Customer Officer CCO), and Chief Digital Officer (CDO). You should expect the same from a Fractional CMO.
| Fractional CMO | Growth Strategist |
Fractional CMO Definition
A Fractional CMO is an outsourced senior marketing executive offering their leadership experience and marketing expertise on a fractional, as-needed basis. The Chief Marketing Officer is responsible for the development and implementation of strategies that generate revenue growth while achieving a strong Return on Marketing Investment.
There has been a massive influx of marketing consultants and service providers labeling themselves as Fractional CMOs in recent years. They do so to increase the rates they charge for tactical marketing services. To support those rates, they write blogs and create content that has caused great confusion about what a Fractional CMO is, and how a CMO delivers the most value and achieves a strong ROI for the client.
Frankly, it is the equivalent of scheduling the rental of a high-performance super-powered European sports car (The Chief Marketing Officer) and receiving a Bosozoku vehicle when you arrive. The small Japanese two-door cars are dressed up with loud exhausts, wings, spoilers, and other after-market add-ons to make them seem like high-performance vehicles.
Just as the Bosozoku can not achieve the performance of a European sports car, a self-proclaimed CMO cannot generate the growth and ROI that an experienced, tested, and highly-skilled senior marketing executive can.
What does a Fractional CMO do?
It stands to reason that a Fractional CMO would have the same objectives, and perform the same duties, as a full-time Chief Marketing Officer (CMO). Granted a Fractional CMO is not an employee of the business and works fewer hours, at a lower pay rate. That should not change the objectives or duties.
The most valuable services that a Fractional CMO can provide are leadership, planning, and development. Some examples of the functions and duties a Fractional CMO should perform include:
- Develop and implement marketing strategies
- Manage execution of key projects
- Source the best in class technology, talented people, and proven processes
- Lead, mentor, and develop the marketing department
- Develop and manage budgets and resources
- Measure and assess ROI, and other Key Performance Indicators (KPIs)
- Optimize brand perceived value and recognition
- Develop unique value propositions that align products with target markets
- Continually evolve to counteract market changes and remain ahead of competitors
These activities will ultimately minimize the importance of price in purchasing decisions, create demand, generate leads, and increase sales, to accelerate profitable revenue growth.
What a Fractional CMO Does Not Do
A Fractional CMO does not perform tactical marketing operations. In other words, they are paid too much to do activities like
- Design graphics
- Write blogs
- Create ads
- Post on social media
- Write and send emails to customers
or anything else that a marketing specialist or content developer can do at a much lower cost.
The Benefits of a Fractional Chief Marketing Officer (CMO)?
There are two financial benefits a Fractional CMO should provide to their clients,
- Profitable business growth
- Greater marketing ROI
These two directly impact the bottom line of a company’s financials and strengthen its long-term sustainability.
However, it is important that a baseline is established before engaging a CMO to evaluate actual improvement in marketing ROI. Furthermore, the growth rate should be compared to the industry’s average growth rate for that year. What if the CMO generates 3% growth while the industry is growing at 8%?
In addition to financial benefits, the CMO provides numerous operational benefits to organizations that do not have a dedicated marketing executive. One of the greatest is relieving the CEO or business owner of the stress caused by trying to grow their business. As well as the headaches caused by the complexities of marketing.
Ideally, the CMO will provide the marketing strategies, leadership, tools, and best practices that successful corporations use, scaled to a level that is right for the client.
Making it possible to,
- Gain a strong competitive advantage
- Generate demand for products and services
- Increase customer acquisition and retention rates
- Develop a favorable customer brand experience
- Improve profit margins and increase sales revenues
- Optimize brand value and drive brand loyalty
to achieve goals and improve sustainability.
How Does a Fractional Chief Marketing Officer Work?
Astute Groups Outsourced CMO services are offered in the traditional Part-Time CMO and Temporary CMO format, as well as tailored engagements for your specific needs. These include,
Get all of the benefits of a CMO for a fraction of the cost. Your CMO is available on a scheduled basis to ensure continuous progress and optimal results.
A CMO on an interim basis, is ideal for filling urgent needs with unexpected vacancies or providing extra bandwidth for critical strategic marketing projects.
A trusted advisor for strategic planning and performance assessment. Usually engaged on a monthly or quarterly basis for an entire to define objectives, develop plans, and gauge performance. Accessible for advice along the way.
Ideal for start-ups, or companies facing physical barriers to working with a high-caliber Fractional CMO, such office location. The Virtual CMO is a more affordable solution because it eliminates the expenses associated with having a Fractional CMO on site.
A Fractional CMO to quickly turn around consecutive losses and overcome the risk of financial disaster. This program is extremely agile and designed to provide relief quickly.
The Role of a Fractional CMO
A good Fractional CMO will eliminate the stress that marketing and growth challenges create for CEOs and business owners. They will hit the ground running and get right to work, with minimal ramp-up. Leading the marketing efforts of your business and building a high-performance marketing department. One that is tailored to your business, its budget, and its goals.
It is not uncommon for executives to become entrenched in their perception of markets, competitors, and their own organization. Often resulting in executives unconsciously forming a bias toward data that validates their opinion. This disregard for research that does not conform with their perspective is known as “confirmation bias” and it has led to the demise of many businesses that were once prosperous.
A Fractional Chief Marketing Officer from Astute Group will also provide an unbiased view that provides a new perspective. They will devise innovative strategies drawn from experience and extensive research to gain deep insight. Then we develop and implement a strategic marketing plan, especially for your business and its goals. A plan that integrates strategies from end-to-end to achieve greater results as a whole.
For smaller projects, we develop a strategic plan that is highly focused on a specific function or objective. These include,
Fractional CMO Job Description
The CMO job description should be essentially the same for a Fractional CMO, with the exception of being a full-time employee. The role of the CMO is no longer focused on advertising and promotion to generate brand awareness and leads. Today, CMOs have the primary responsibility for growth strategies and generating revenue.
The duties of a Chief Marketing Officer in the modern business environment include,
- Oversee the planning, development, and execution of marketing and advertising initiatives
- Generate revenue by increasing sales through successful marketing for the entire organization
- Coordinate marketing efforts with the company’s financial and branding goals
- Define marketing strategies to support the company’s overall strategies and objectives
- Develop a feasible marketing plan for the department and oversee its day-to-day implementation
- Plan and organize marketing functions and operations (product development, branding, communications, etc.), and ensure they project the company’s unique “voice”
What makes a good Fractional CMO?
To find the right Fractional CMO for your business, we recommend assessing experience, education, skills, and accomplishments. Common requirements found in a CMO job description include,
- At least 7+ years of experience as Chief Marketing Officer or Vice President of Marketing
- Bachelor’s degree required, an advanced degree in marketing or business (MBA) preferred
- Thorough knowledge of marketing principles, brand, product, and service management
- Deep understanding of changing market dynamics
- Solid understanding of market research and data analysis methods
- Working knowledge in a variety of disciplines such as production, information technology, legal, and finance
- Strong business acumen, experience developing annual budgets and developing accurate forecasts
The primary objective of a CMO is to drive strategic long-term growth. That is how a Fractional CMO delivers a strong ROI to clients. This Executive-as-a-Service model generates significant cost savings by providing all of the benefits of a Chief Marketing Officer (CMO), for a fraction of the cost.
Outsourcing a CMO eliminates the challenges and expenses associated with finding, hiring, training, and equipping a new senior marketing executive. Because Fractional CMOs are not direct hires, they eliminate the costs and commitments associated with an employee.
Fractional CMO Services
When companies seek Fractional CMO Services, they are looking to invest to grow their business and take it to the next level. The Fractional Chief Marketing Officer should generate a strong return on the investment made into their services. To do so, they need to realize that a corporate CMO has two key objectives that directly impact the bottom line: developing growth strategies and driving revenue generation.
To achieve these objectives, we provide our clients with:
- Comprehensive research for a deep understanding of markets, competitors, trends, and geo-political factors
- Strategic plans that define the path to achieving your goals and objectives
- Sales enablement and business development tools
- Guidance, training, and development to improve marketing department performance
- We will source or develop
- We will source or develop
- Astute Analytics™ a clear and concise executive dashboard to monitor performance and drive decisions
How much does a Fractional CMO cost?
It is important to note that the hourly rate for a fractional CMO is less important than the revenue growth a Fractional CMO should produce. In other words, the cost of a Fractional CMO should only be a small portion of the revenue growth generated by Fractional CMO services.
The fractional services model incorporates an “only pay for what you use” approach which minimizes your investment and maximizes the return. So, rather than asking the hourly rate of a fractional CMO, a better question is; “How much does a Fractional CMO cost?“
Operations level work may be billed on an hourly basis. This is because it is suited for more simple services and unique projects. As the complexity and depth of the services increase, the greater the need for greater knowledge and advanced skills. Qualities that cannot be measured by metrics that gauge the level of activity, but rather by Key Performance Indicators KPIs that are directly linked to the bottom line. You will find that experienced and knowledgeable Fractional CMOs will be able to provide a thorough proposal that provides a flat fee structure and clearly defines the scope of work.
Likewise, hourly fees are often an indicator of a fractional CMO who is inexperienced. Proposing a quote based on hourly fees is a strong indicator that the service provider cannot accurately gauge their entire scope of work and charge accordingly. In other words, they cannot determine what is needed to achieve the client’s goals, therefore they cannot calculate the cost of delivering actual Fractional CMO services.
What is a Fractional CMO “Impostor”?
A Fractional CMO impostor claims to offer Fractional CMO services without having real-world experience working as a Chief Marketing Officer or Marketing Vice President. Be wary of service providers that pronounce themselves as a CMO in their own firm, without having the experience or credentials to back up their claim. These impostors lack the experience, knowledge, and skills needed to develop high-caliber marketing strategies that drive optimal results. They tend to focus on operations level marketing services such as developing content or managing social media accounts.
The outsourcing trend created by the gig economy has made “Fractional CMO” a very popular marketing industry buzz term. One that has been adopted by advertising agencies, consultants, digital marketing firms, temporary employment agencies, and many other service providers. Many of whomhave never been responsible for managing every aspect of marketing in a profitable or growing enterprise.
These impostors ultimately create a losing scenario for clients by providing:
An experienced Chief Marketing Officer has the experience, education, and skills needed to develop innovative and highly-effective marketing strategies. If your Fractional CMO does not have those capabilities, you may be paying less for the CMO services and not realizing the higher cost that could be fatal, the cost of lost opportunities.
If your Fractional CMO is providing operations level services such as creating content, managing social media accounts, developing email campaigns, etc. You are overpaying for marketing services available for rates much lower than those of a Fractional CMO.