Marketing departments all across the nation are finally breaking free from the effects of the COVID pandemic. The 28th edition of the annual CMO Survey found that According to a recent Chief Marketing Officer survey, marketing spending increased by over 10 percent as we were rolling into 2022– the highest growth rate in more than 11 years.
Companies are also expanding their marketing teams, the average growth of teams across multiple industries is well over 12 percent. Companies large and small are now hiring marketing executives to help foster growth.
Now that we are moving forward in the wake of COVID, chances are you’re thinking to expand your marketing capabilities as well, and considering hiring a fractional chief marketing officer (fractional CMO) and that, ladies and gentlemen, could be your best next move.
Here’s everything you need to know before making the decision to outsource a CMO and answer the burning question…
Is a Fractional CMO Right for You?
What is a fractional CMO?
A fractional CMO is someone who performs the role of chief marketing officer on a contractual basis. They’re called fractional CMOs because they work at your company for only a ‘fraction’ of their time. Thus, they are part-time employees. You can hire a fractional CMO for as much time as you need without the hassle of bringing on a full time employee.
Hiring a fractional CMO is often a good strategy for a medium-sized company that either cannot afford to hire a full-time chief marketing officer or doesn’t have that many projects. They provide useful leadership and offer the expertise of an experienced executive without the hefty price tag. They are also very useful during a season of transition and can work on an interim basis.
What does a fractional CMO do?
Typically brought on for a minimum of 90-180 days, fractional CMOs are responsible for developing a marketing strategy, optimizing marketing efforts, and managing your marketing department. They provide leadership and executive-level expertise to help companies deliver clear and unified marketing campaigns on a short-term basis.
Their exact job responsibilities are flexible and should be custom tailored to the needs of your company.
So, what is the difference between a fractional CMO and a regular chief marketing officer?
In short, the main differences between a fractional CMO and a chief marketing officer are the hours they work and the salaries they receive.
Fractional CMOs’ operate on a temporary contract, a fractional CMO typically works part-time, for no more than 20 hours per week, whereas a chief marketing officer works full-time hours and is compensated with a higher salary and benefits.
As a result, fractional CMOs’ salaries are just a fraction of the cost of chief marketing officers’ wages. A recent survey by a recruiting firm reports that the average salary for a chief marketing officer is about $177,000 a year. Salary.com suggests the median salary is even higher, at $253,000.
A fractional CMO generally charges around $200-$300 per hour. So, they will be compensated about $48,000 per year to $72,000 annually if you hire them for 20 hours a month.
Are there benefits of hiring a fractional CMO?
The University of Notre Dame analyzed data from more than 150 publicly traded firms to determine the value that chief marketing officers brings to their companies. They found that companies with a CMO performed 15 percent better than companies without one. on average.
Here are some benefits of hiring a fractional CMO:
Experience and leadership – A fractional CMO can organize your team and devise a custom-tailored marketing plan drawing on relevant consumer insights, establishing and hitting your KPIs.
Fewer hiring risks – Hiring a fractional CMO is less risky than hiring a full-time CMO; the recruitment process is faster, and they can be more easily replaced if they perform badly in the role.
Test your ideas – Hiring a fractional CMO allows you to test different skill sets in the role without the fear of being permanently locked into an unfavorable arrangement.
Flexibility – A fractional CMO’s contract can be stopped and started to meet the changing needs of your company or campaign.
Fresh eyes – Outsiders often find it easier to identify areas for improvement. They also offer fresh ideas and insights.
Budget Bonus – Fractional CMOs are significantly more affordable than traditional CMOs as their salaries are lower, and they are entitled to fewer benefits than full-time employees.
How much does a fractional CMO cost?
What is a fractional CMO’s hourly rate?
The exact cost of hiring a fractional CMO depends on years of experience and expectations. As mentioned earlier, a fractional CMO’s hourly rate is typically between $200 and $300 per hour + expenses.
If you hire them for 20 hours a month, you’ll pay between $48,000 and $72,000 every year.
When should you hire a fractional CMO?
The best time to hire a fractional CMO will vary by company, industry, and what is “going down” in an organization. But generally, you should use fractional CMO services if:
- You want to improve your marketing and grow your business without committing to a full-time CMO
- You need fresh digital marketing strategies and marketing initiatives with an expert to implement them
- Your company needs marketing leadership and guidance
- You have the team members to execute a strategy but none of the marketing insights to do the strategic planning
- Your marketing message is inconsistent across different channels
- Your management team needs to delegate work
- You have a specific pain point that you think a marketing leader could solve
- You need help managing agency relationships
- You need a full-time CMO’s services without the right marketing budget for it
Fractional CMO vs hiring a marketing agency: Which strategy is right for your business?
Whether you should hire a fractional CMO, engage a marketing agency, or form a stronger in-house team will depend on the needs of your company. We would love to help.
Thank you for taking the time to read this post, I hope this helps you identify whether or not a Fractional CMO is right for your organization. Please be sure to share it with anyone that you feel it may benefit.
