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7/7 #ThreeMinutesADay: When You Should Hire a Fractional CMO
Three minutes a day takes bad business decisions away.
Today's tip: Hiring a fractional CMO is a great way to save money and get brutally honest feedback about your company’s marketing. It also makes sense for almost any company with fewer than 50 employees.
In a hurry? Just watch the video below.
What is a Fractional CMO?
A fractional CMO is a marketing term that refers to an outsourced marketing executive who is hired on-demand and performs the functions of a traditional Chief Marketing Officer for your company. They are “fractional” because they only spend a fraction of their time with your company (and cost a fraction of the price of a full-time CMO!).
Outside of the time and cost commitment, they do everything else a “real” CMO would do for your company including: setting your marketing strategy, dealing with marketing budgets, executing marketing campaigns, analyzing marketing results.
Who Should Use a Fractional CMO?
Anyone without a full-time CMO can use a fractional CMO. Whether you are a B2C company or a B2B company, pretty much any company with fewer than 50 employees should use a fractional CMO instead of hiring one full-time.
This is because companies with fewer than 50 employees are most likely not in a position to provide a full-time CMO with all the resources they truly need to make a real, tangible impact on your organization.
If your company is around that size and you believe you will eventually want a full-time CMO, a fractional CMO gives you the opportunity to prepare for that. A fractional CMO can help you improve your marketing practices - the right processes, the right resources, the right metrics – and get you to a place where a full CMO may actually be able to make a real difference down the line. And, again, do so at a fraction of the cost.
What are the Benefits of a Fractional CMO
It Costs Less
Yes, this is a recurring theme but it cannot be overestimated how important this is for small to medium-sized businesses. When your bottom line is so important, saving money on big salaries where you can is crucial. And, a CMO is a BIG salary.
In Chicago, for example, the average salary for a Chief Marketing Officer, according to Salary.com, is $256,000 per year. That is before you factor in things like the benefits and the employment taxes you have to pay. All this is before you even spend a dime on the actual marketing.
On the other hand, the average fractional CMO costs between $200 - $250 per hour. This is a huge cost saving that will allow you to spend your money where it will really make a difference: on your company’s marketing.
They Will Tell You the Truth
The other big benefit a fractional CMO offers that a traditional CMO may not is that they will be brutally honest about your company and your company’s marketing.
I’m not suggesting that full-time CMO’s all inherently lie to you, but the fact is that fractional CMOs are not burdened by – or at least are less sensitive to – the normal internal dynamics of a company. Issues such as internal politics, interpersonal dynamics, and learning the lay of the land are all things that affect a fractional CMO less than a full-time one.
Fractional CMOs usually split their time between two to four clients at any one time. This kind of schedule usually means they will cut through any nonsense, tell you exactly what you need to do and the resources needed to meet your objectives. This is an invaluable trait from a fractional CMO.
What are the First 3 Things a Fractional CMO Should Do for You?
When you bring in a fractional CMO, time really is money so you want to get right down to business. There are three main tasks a fractional CMO should be tasked with to help improve your company’s marketing.
1. Review Your Internal Processes
This should be a full, 360 review of everything you have been doing to this point. Once they have reviewed and analyzed all of your marketing, they should be able to provide a “no BS” assessment of what has been working, what has failed, and what you can do to either get what you are doing to work or what you should do instead if you want to see more success.
2. Devise a Plan of Attack
The second thing you want your fractional CMO to do is to come up with a game plan about what your company can do going forward to maximize the ROI of your marketing program. This plan should, most importantly, be scalable to meet your company’s objectives in the short, medium, and long term.
3. Track Your Marketing ROI
The marketing review and plan a fractional CMO puts in place is only as good as the ROI it produces. In order to track the ROI, your fractional CMO should put metrics in place that track how the strategy is doing, what kind of brand awareness it is driving, the sales numbers it is creating, and what kind of return you are actually getting on your dollars spent.
Whether you know you don’t have the money or the resources for a full-time CMO, you want to test the waters to see if you do, or you just want to save some money and get some real feedback from an outside voice, hiring a fractional CMO can be a great move for your company.
These freelance marketing experts bring a great deal of expertise, a no-nonsense attitude, and can provide a vision you won’t get from the inside. When directed to analyze your marketing, create a plan, and put metrics in place to track ROI, a fractional CMO can transform your organization’s marketing and add real value to your company without a full-time commitment.
Have you or your company ever used a fractional CMO? Do you have any additional questions about how a fractional CMO works? If so, let me know in the comments below.
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