All about fractional CMOs - your questions answered
A fractional CMO provides all the experience and accrued wisdom but at a fraction of the price of employment.
Most start-ups and small businesses could benefit from a talented and experienced marketer but it can often be folly to recruit one. Good CMO salaries are upward of £125,000, plus additional employment costs, and the truth is in many cases, 50% of the time that CMO will be doing the work of someone well beneath that paygrade.
>> Find the true cost of employing a CMO here
You don’t want to pay someone £130k+ a year to write blog posts or set-up PPC campaigns.
But you may need someone to oversee and direct that activity.
You just don’t need them there 5 days a week.
What is a fractional CMO?
A fractional CMO is a strategic head of marketing who you hire for a fraction of the week or month rather than full time.
Fractional CMOs are different to part-time employees – we have chosen a portfolio career and have the skills to quickly get up-to-speed with your business and to add value fast.
We sometimes come under different names – including ‘Portfolio CMO‘ or ‘Fractional Marketing Director‘.
What does a fractional CMO do?
A fractional CMO gives you competitive advantage – we’re here to help you grow your business.
Your fractional CMO will focus on the highest value work – that might include:
- Working with you to create and deliver your growth strategy
- Ensuring your organisation is optimised with the right team and tech set-up to deliver the strategy
- Creating, enhancing and managing processes to ensure efficient execution
- Ensuring that all execution is on point and delivering the strategy
- Coaching, mentoring and leading the marketing team
Why use a fractional CMO?
A fractional CMO can help in a variety of circumstances – whether you are scaling or have hit a growth wall, whether you need fresh ideas or you’re just not ready for a full time CMO yet.
A fractional CMO gives you flexibility.
We are usually pretty quick to start and you’re typically tied-in for just a few months to start.
We’re cost-effective (we only do the high value work).
And we’re cheaper to hire (only pay us for the days we work, no recruitment fees, no additional employment costs such as NI, pensions or holiday pay).
What sort of businesses use a fractional CMO?
While any business can use a fractional CMO, those most likely to do so often have a turnover of between £1m and £10m.
However, there are plenty of larger businesses – particularly in B2B sectors – who benefit from a fractional CMO.
Many businesses using a fractional or portfolio CMO will be going through an inflexion or major change in their business – for example:
- High growth companies – or those seeking high, fast growth
- Businesses facing a growth challenge
- Companies pivoting in their product or market approach
- A business which has a junior marketing team who need coaching from someone with experience.
For smaller businesses and early-stage start-ups, a fractional CMO could work for you but you may also want to consider advisory CMO services or coaching. I specialise in coaching founders who find themselves doing their own marketing (or managing the marketing team).
Think of me as a “founder’s friend”, someone who can offer advice and support, not just from a marketing perspective.
Should I hire a fractional CMO or outsource to a marketing agency?
Every start-up and scale-up business is different.
Both approaches have their merits and it does depend a little on your circumstances:
- Typically, a fractional CMO will oversee but may not directly execute many marketing campaigns. Instead they will direct activity to be done by a junior marketer (who could be freelance, employed or agency-based).
- While agencies do get involved in strategy work, this is often not the best use of them. They’re also unlikely to be able to develop internal processes or build your internal marketing capability long-term. A fractional CMO will.
- If your business would benefit from working closely with an expert over an extended period of time, someone who takes a deep personal interest in your growth and success, a fractional CMO is the better route.
- And don’t forget, they’re not mutually exclusive! One key use-case of a fractional CMO is in managing your agency – this can be super-helpful if you don’t have marketing experience in-house and your agency isn’t delivering as well as you had hoped.
Fractional CMO, portfolio CMO, advisory CMO, interim CMO, part-time CMO, or marketing consultant?
Sometimes marketers just love to create new names and to confuse.
Different people have different understandings of the titles available – here’s my guide:
- A fractional CMO and a portfolio CMO are essentially the same – your business benefits from a CMO who is highly experienced and used to working with multiple clients at the same time. Typically not employed but definitely ’embedded’ – they understand your business deeply and do all the strategic work (yes, and some execution!) that a regular CMO would.
- An advisory CMO works with you on a retainer, they understand a lot about your business and have regular meetings – but the real value they add is by being on call, ready to field questions, work with the marketing practitioners, offer feedback and to be there in a crisis.
- An interim CMO is someone works with you for a limited period of time, usually to cover the role of the full-time CMO when they are on extended leave. They can also be used to cover a period when a business is seeking a strategic change and isn’t yet ready to recruit a full time CMO.
- A part-time CMO is similar to a fractional/portfolio CMO but doesn’t have multiple clients, they simply don’t work full time. They are usually treated as standard employees.
- A marketing consultant is hired to do project work – perhaps a proposition review or to launch a new product for example. Most fractional CMOs will consider consultancy projects (I certainly will!).
How much does a fractional CMO cost?
Less than an employed CMO!
>> Find the true cost of employing a CMO here
Because you’re only paying for the contracted days, you’re not paying all the additional employment costs such as:
Employer’s pension contributionsNational InsuranceLaptopMobile phoneHoliday paySick pay
What’s most important is the value you get from a fractional CMO – they only focus on the important work.
Most fractional CMOs will charge on a day-rate or retainer basis, depending on the number of days used a month. In my case, that could range between £759 and £874 a day – I’m totally transparent on rates.
What's the typical contract length for a fractional CMO? Or the notice period?
While every business is different and a good fractional CMO can make an impact quickly, there is still a minimum contract which works for both parties.
Your ‘probation period’ for a full time CMO or marketing head will probably be 3 or 6 months – that’s essentially somewhere between 60 and 125 working days for you to understand that it’s working.
A fractional CMO should be able to get up to speed quicker (it’s what we do), and doesn’t face many of the distractions that an employee might.
Therefore, my minimum contract to start with is usually 3 months (sometimes 6 depending on circumstances).
We then roll over a flexible CMO contract and offer a 1 month notice period – which can be extended by mutual agreement.
How do I measure ROI from a fractional CMO?
Your investment in a fractional CMO needs to show a return. But understanding that return and calculating ROI from your fractional CMO is challenging.
Core to understanding the ROI of your fractional CMO lies in setting the right KPI and expectations at the start of the engagement. I am a strong advocate for your #1 marketing metric being CAC (Cost of Acquisition), but it may be that your primary motivation is, say, year-on-year growth rate.
Whatever the metric(s) you choose, it’s important to recognise that, though your fractional CMO day rate may be higher than an incumbent marketer, they are only there for a limited time each month and you have none of the other costs of employment.
How do I choose a fractional CMO?
In part, your choice of fCMO comes down to personal fit – you’re likely going to have to work with them closely, and you’ll definitely have to trust them.
Depending on your needs at the time, you can select a fractional CMO who has direct experience in your sector – or you could choose someone with different experience for a more varied view point.
It may be more useful to select someone who has experienced the problem you are looking to fix, rather than the market you are looking to conquer!
It’s important also to choose someone who has real experience as a fractional CMO – not just as a perm head of marketing.
The skill set for a fractional is different:
- A fractional CMO needs to get up to speed very quickly.
- A fractional CMO won’t manage your team but they will influence them.
- A fractional CMO needs to be able to focus 100% but be able to move between clients easily.
My best advice is to spend some time really getting to know your prospective fractional CMO. But also remember, this isn’t until-death-do-us-part, and there’s minimal cost in closing down a relationship – it’s a much less risky hire than permanent!
