Why a Fractional Marketing Director Is Cost Effective
Factors such as channel saturation, algorithm changes, and increased marketing costs make it difficult to rely on marketing strategies alone. You can boost marketing efforts with a fractional marketing director without raising costs.
Here are the reasons why:
- Providing expertise on demand.
- Allowing flexible budgeting.
- Giving access to a network of professionals.
- Reducing risks.
- Expediting marketing efforts.
- Improving the scalability of marketing campaigns.
We also discuss why businesses hire a fractional marketing director rather than a fractional chief marketing officer (FCMO), and how to calculate the return on investment (ROI) of the fractional director's services. Let’s go!
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How a Fractional Marketing Director Is Cost-Effective
A fractional marketing director offers cost-effective solutions for big or small businesses. They provide expertise when needed, flexible budgeting, cost savings, and more. Let us take a closer look at each one.
1. Providing Expertise on Demand
Some marketing campaigns need immediate attention, while others need continuous monitoring. An outsourced marketing director is ready to offer expert on-demand services. Unlike full-time employees, they focus on immediate marketing needs. They check and analyze specific campaign areas at any time, minus the overhead costs.
2. Allowing Flexible Budgeting
In-house marketing directors, as opposed to fractional marketing directors, become cost-effective for businesses that do not have the budget to hire a full-time director. Companies can enjoy flexible budgeting by scaling a director’s services up or down. They only pay for the services they need or the time they spend on the marketing campaign.
3. Giving Access to an Extensive Network of Professionals
A fractional marketing director has access to an extensive network of professionals. Businesses can tap into this network without the expense of hiring many in-house experts or agencies. This access helps secure specialized skills and resources. It reduces the cost of building an in-house marketing team or outsourcing to a variety of vendors.
4. Reducing Risks
Hiring a fractional marketing director becomes cost-effective because it reduces risks. If the arrangement does not work out or the market conditions change, it is easier and less costly to adjust or end the engagement with a fractional marketing director than it is for a full-time executive with a long-term commitment. This flexibility reduces potential financial liabilities and ensures efficient risk management.
5. Expediting Marketing Efforts
A fractional marketing director expedites marketing efforts because they are able to immediately dive into projects and initiatives. They can use their expertise and experience without the delays associated with a full-time hiring process. This rapid deployment allows businesses to capitalize on opportunities faster. This, in turn, leads to faster revenue generation and cost savings by accelerating time-to-market.
6. Improving the Scalability of Marketing Campaigns
These part-time marketing director experts improve the scalability of marketing campaigns. They can adjust their involvement depending on the needs of the business. This adaptability allows firms to scale marketing efforts up or down, ensuring resources are allocated. They also cut unnecessary costs during periods of lower activity.
Why Hire a Marketing Director and Not an FCMO?
Hiring a fractional marketing director instead of an FCMO can be a suitable choice under certain circumstances:
- Lower-Level Leadership: If the business needs day-to-day marketing management and execution of strategies, a fractional marketing director can provide hands-on leadership without the need for the more strategic role of a CMO.
- Budget Constraints: Fractional marketing directors tend to be more cost-effective than FCMOs. This makes them a better fit for smaller businesses or startups with limited budgets.
- Immediate Execution: If the company’s urgent marketing needs involve implementing and managing campaigns rather than developing long-term strategies, a fractional marketing director is able to jump into action more quickly.
- Team Collaboration: Fractional marketing directors work with the existing marketing team. They provide guidance, oversight, and support. This enhances team performance without taking on the broader strategic responsibilities of a CMO.
- Specialized Expertise: A fractional marketing director focuses on specific tasks without assuming the broader CMO role if the business’s primary need is specialized marketing expertise in certain areas (e.g., digital marketing, content creation, or social media management).
Check your business's unique circumstances, objectives, and budget when deciding between a fractional marketing director or an FCMO. Consider the level of leadership and expertise needed, the duration and scope of the marketing projects, and how these factors align with the business strategy.
How Do You Determine the ROI of a Fractional Marketing Director?
Determining the ROI of a fractional marketing director’s services involves evaluating their impact on your business's marketing efforts and financial performance. These are the steps for calculating ROI:
1. Set clear, measurable objectives for the fractional marketing director. Typical goals include increased website traffic, lead generation, sales, brand awareness, or cost savings.
2. Identify relevant key performance indicators (KPIs) that align with the objectives. These include website conversion rates and customer acquisition costs. It also includes customer lifetime value and revenue generated from marketing campaigns.
3. Measure the current state of your marketing efforts. Consider its state before the fractional marketing director’s services.
4. Track the KPIs and metrics related to the marketing goals throughout the director’s engagement.
5. Calculate the total investment in the fractional marketing director’s services. This includes fees, extra expenses related to their work (advertising budget, software, and tool costs), and initial setup or onboarding fees.
6. Determine extra revenue generated or savings achieved. Include revenue increases or cost reductions in their campaigns or strategies.
7. Calculate ROI using the following formula:
ROI = (Increase in Marketing-Related Revenue - Cost of Fractional Marketing Director) / Cost of Fractional Marketing Director * 100%
If a fractional marketing director increases marketing-related revenue by $100,000 and their cost is $50,000, the ROI will be:
ROI = (100,000 - 50,000) / 50,000 * 100% = 100%
The result means that you received a dollar back in increased revenue for every dollar you invested.
1. Consider qualitative factors such as improved brand perception or customer satisfaction. These might not be immediately quantifiable but contribute to long-term ROI.
2. Compare the calculated ROI to the baseline measurement. This indicates the impact of their services.
3. Check ROI throughout the engagement. It determines whether the fractional marketing director’s impact is consistent or improving.
4. Use the insights from ROI calculations to provide feedback to the fractional director. Adjust strategies or objectives as needed to optimize ROI.
Calculating ROI requires quantitative analysis and qualitative assessment. Establish clear objectives, track relevant metrics, and check impact to make informed decisions.
A fractional marketing director is cost-efficient because they provide expertise on-demand and flexible budgeting. They have access to a network of professionals, reduce risks, and expedite marketing campaigns. Businesses can scale their marketing campaigns and enjoy other benefits when they add a fractional director to their marketing team.
Regular revenue monitoring helps track the performance of your campaigns under the leadership of a fractional marketing director. It ensures campaigns align with marketing goals and leads to business growth. Find out more about how a fractional marketing director can help your business. Call Digital Authority Partners (DAP) today for digital marketing expertise.
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