The Growth of Fractional CMOs
Fractional, or Freelance, Chief Marketing Officers (CMOs) are marketing leaders who support marketing functions across a wide range of areas but in a flexible and part-time manner. They are going to become an increasingly common phenomenon in the months to come. Why? Read on.
Why do I think they’ll become more common?
As we approach the end of 2023, current market conditions for tech companies are challenging, to say the least. The immediate outlook is also going to be difficult between rising interest rates, the conflict in the Middle East, the Ukraine invasion, and the impending US elections likely to negatively impact growth. “Belt tightening” is increasingly common, as B2B SaaS companies chase “efficiency” and “profitability”, over “growth” so certain C-suite leaders like the CMO are likely to be under threat in certain contexts. (I am of course making some broad generalizations here).
On the flip side, there has been an explosion in the number of freelance marketers, due to a mix of push and pull factors:
The increased attraction of being able to work remotely
The high turnover rates in full-time roles lead to a lack of job security (which can be derisked by managing several clients at once)
The dearth of senior B2B SaaS marketing skills
The reduced friction (or lower transaction costs) associated with using freelancers
The attractive business model for SMEs, who may not be able to afford a full-time CMO, but would benefit from the skills of a seasoned professional
So what should you look for when hiring a Fractional CMO?
1. Domain expertise
Marketing is a pretty broad discipline. You’ll want to narrow your search down to align with the specific nuances of what you need. For example, at Work With Agility, we specialize in B2B SaaS marketing, looking to optimise the funnel at pace, and at the lowest Cost of Acquisition (CAC).
To go a layer deeper you could also add the following as filters:
Local knowledge - ideally choose a CMO familiar with the primary market you are selling into
Team size and seniority - depending on the marketing function headcount you may need a more senior fractional leader
Fundraising - do you need someone adept at working their magic on a shoestring e.g. Seed level or someone who has scaled a Series D function?
Budget - resourcing is also a key element - what size budgets have you to play with?
Industry sector - for example, cyber security is one area where sector expertise is valuable (the same applies to finance, retail, B2B SaaS etc)
By aligning on these areas you can reduce the search area to a smaller subset of suitably qualified candidates to choose from.
2. Digital footprint
For someone working in marketing, a quick Google search on their name should help you assess whether they’ve been putting into practice what they’ll likely preach.
Have they published some long-form content?
Are they active on social media platforms like Linkedin?
Have they appeared on podcasts, videos, or events?
Do they have their own website showcasing their work?
If their online footprint is weak I’d look to understand why that is the case. After all, one way to evidence “capability” is to use real-life examples to support their claims - “show me don’t tell me”.
3. Social proof
Much like B2B SaaS websites rely heavily on third-party validation, professional services are no different. While they won’t have a G2 / Capterra presence (leading SaaS review sites) there needs to be some external evidence to help you assess their competence. While this is trickier for those getting started, the more established Fractional CMOs should have some testimonials, as well as logos of companies they’ve worked with to help provide independent reassurance.
4. Specific requirement
It is also really important to have a clear sense of what you are looking to achieve with a Fractional CMO so that you optimise their time and your investment.
Is it to audit an existing function and to seek areas for improvement?
Is it maternity/paternity cover where you need someone to hold the ropes for a short time?
Is it to undertake a special project like a website migration or implementation of certain marketing technology?
Is it to support a marketing leader who lacks broader experience?
Is it to transform the function and how it operates?
Is it to support the function after an investment raise?
Or to prepare the business for acquisition?
These and other reasons will help you narrow in on what you are looking for, serving to increase the odds of you finding the right person.
5. Skillset
The skills marketing leaders have can differ widely depending on the context of previous roles.
Some may have worked in regulated industries, others in more creative industries. Others will have had a heavy lead generation focus, others may be stronger on brand or internal communications. As per the previous point, once you are clear on what they need to do you can be clear on the exact skills you need.
6. Location
If you advertise for a remote role, you’ll likely be inundated with prospective candidates from around the world. Not all of these will be native English speakers which can be a challenge for certain tasks. Similarly, some overseas applicants may lack a nuanced understanding of your primary target markets. Finally, time zones can be a factor for some. It is thus worth narrowing in on a preferred remote location to limit search costs, while also enabling some in-person meetings on an ad hoc basis if need be.
7. Freelance partners
Finally, an experienced freelancer will likely have a black book of contacts they can introduce you to for specialized tasks e.g. Google Ads management (paid acquisition), copywriting, website development, SEO, branding, etc. This is very valuable as these contacts will be ‘tried and tested’ and you don’t need to go through the identification and selection process which can be hugely time-consuming
If any Fractional CMO offers to undertake some of these more specialized tasks I’d be pretty concerned - after all, a CMO is a generalist role and they should be acting more as the conductor of the orchestra, and not someone playing the ukulele, the piano and the cello!
What are things to watch out for when hiring one?
So when it comes to hiring a freelance or fractional CMO on an interim basis what are some of the elements you need to be watching for?
1. Contract terms should be flexible
A Fractional CMO should offer flexible terms with no long-term commitments (unless you need the assurance). Instead, contracts should be more open-ended where you can agree on a minimum term (perhaps 3 months) and roll them over on an “as needs” basis. They may work 1 or 2 days a week or may focus on a specific project, rather than the BAU. Anymore and you’ll find it hard to make the math work unless they drop the day rate significantly.
2. Be wary when there is weak evidence
As referenced above, social proof and a digital footprint help you evaluate a prospective CMO’s credentials. If they are lacking in these you need to understand why. If they are starting on their fractional journey they may lack social proof to date, but hopefully, reviews on their LinkedIn profile may give some comfort.
Otherwise, you’ll need to bake some competency-based deliverables into the selection process so you have better evidence that they are what you need.
3. Manage the interaction with the existing marketing team
It can be very challenging for a marketing team when an external freelancer is added to the team. The Fractional CMO will bring a fresh perspective and will likely be drawn to areas that are deemed in need of the most attention. Many B2B SaaS marketing teams (especially in Europe) are chronically under-resourced and thus a newcomer will likely find lots of areas for improvement. This bias for problem-solving will meet the needs of the CEO but is likely to lead to a challenging engagement with the wider team. At the very least it is important to have a robust conversation with the team about “priorities” rather than simply imposing them.
4. Set clear expectations regarding deliverables
Setting expectations up front as to specific deliverables is a requirement to ensure alignment. In some instances the remit can be as broad as “leading the function”, whereas in other scenarios it can be to deliver specific outcomes. It is important to align on the expectations as to what the outputs are.
5. Watch for Scope Creep and Problems Caused by the extra work
As the CMO will be looking to make an impact and to deliver improvements, any audit they undertake will likely generate a list of tasks that need to be done.
You need to consider the following in advance:
Do these automatically become high-priority tasks?
Where do they fit against the current backlog?
How will the team react if their workload increases?
Finally, you’ll want to avoid the CMO undertaking the tasks - despite good intentions, they need to stay high level and “out of the weeds” and you want to engage and empower your own staff to deliver too.
6. Avoid a “Yes” person
Some CEOs hire external CMOs to help convince the marketing team as to a course of action. This is not sensible. They need to be willing to speak their mind based on their own analysis.
7. Ensure they are data-driven
An experienced Freelance CMO should ask for access to Google Analytics 4, Google Search Console, and other applications like the CRM or SEO platform to help understand the current website performance. If they don’t use data to shape their thinking you may be better off to “pause” after the trial period has lapsed.
8. Be a healthy skeptic regarding any AI-lead ideas
There is no doubt AI is beginning to take off, but we are still very much in the early days of figuring out how it can be most effective in a marketing function. It can certainly help with productivity and has an ever-growing set of use cases for marketing. I’d argue that it should not be used to generate content - while it may save time, your prospects are looking for authoritative and unique perspectives on solving the challenges they have. I’d recommend pushing back if your freelancer proposes using AI to fast-track a content production pipeline.
9. Seek to measure impact
One inherent drawback of a fractional engagement is it can be difficult to measure results, especially in such a short time frame. However, as they propose different solutions it is worth filtering them through a lens that assigns an impact probability to them, alongside an assessment of the cost (be that monetary or the amount of time needed to effect the change).
10. Be aware of availability challenges
As most act as sole practitioners, your requirements may not align perfectly. Freelancers have a delicate balance in managing client requirements, especially if they are fully booked. Meeting clashes can be unavoidable so it is worth bearing that in mind. Some may be running 5-6 clients simultaneously and thus will likely have some diary constraints.
So where can you find a Fractional CMO?
In most instances (especially in the UK/ Ireland) they tend to operate as solo operations, rather than consultancies. Part of the motivation is to keep costs down and to operate on as low-cost a basis as possible.
There are thus three main sources you can look to find freelance talent.
“Word of Mouth” is a typical route, although that is more challenging in a post-Covid world where there is no doubt relationships are weaker than was once the case.
Via sites like Growth Mentor and the CMO Alliance
Via very specific Google or LinkedIn searches like B2B SaaS Marketing Consultant London or Fractional CMO SaaS Startup
Summary
In summary, Freelance or Fractional CMOs (or virtual Chief Marketing officers) represent a popular option for growing technology businesses that are keen to ensure the marketing function has the requisite level of experience on hand. The low-commitment nature of most engagements enables you to test suitability without getting locked in and you can dial them up as you see fit. Of course, the better ones tend to get booked up quickly, and thus aligning on their availability can be an issue. However, it’s worth persisting, as the right fractional CMO can unlock revenue, find you new customers and markets and ultimately deliver a return that is many multiples on your investment in them.