SaaS Marketing

Everything You Need to Know About The Role of a Fractional CMO

Ameet Mehta
Apr 10, 2024
17 mins read
Everything You Need to Know About The Role of a Fractional CMO

The marketing world is booming, but keeping up with trends and delivering results can feel overwhelming. A recent report highlights the shift towards personalized marketing, placing even more pressure on CMOs (Chief Marketing Officers).

They now juggle tasks like customer data integration, maximizing ROI (Return On Investment) from campaigns, and staying ahead of the curve. This workload can be crippling for a full-time CMO, especially considering the high cost of top talent.

Here’s where a Fractional CMO steps in, offering a practical solution for businesses struggling with limited resources or internal friction.

We’ll delve deeper into the concept of a Fractional CMO next…

What is a Fractional CMO?

A fractional CMO or Chief Marketing Officer is an outsourced position contracted for a certain period to lead your team in a part-time role. The fractional CMO generally steers the direction of the marketing team’s go-to-market strategy aimed at achieving product market fit as the business scales.

Having worked with Fortune 500 companies or companies with five-figure MRR, they have a wide range of marketing skills that can shape any organization’s marketing plan.

It’s a good idea to hire a fractional CMO if you need C-suite-level leadership for only part of the week.

For example, if you need help with complex messaging or go-to-market situations. They should expect to do some IC work but that’s not the point of the role.

How Does A Fractional Leader Work?

A fractional CMO guides and grows your team as they grow your business. They’re embedded in your organization either working virtually, hybrid, or in person.

Fractional leaders typically specialize in strategy development and implementation. They focus on the “big picture” for your specific needs, whether it’s marketing, sales, operations, or another area.

While some fractional leaders may offer assistance with executing the strategy, others focus solely on providing guidance. This depends on your agreement and the leader’s approach.

Typically, a fractional leader shares their expertise with your internal team, and does knowledge transfer to simultaneously train your team.

Note: Avoid hiring a fractional CMO to do the grunt work like lead generation, simple outreach, basic content writing, etc. It would be a waste of their time and money. Instead expect them to bring a strategy and provide them resources to get it done. They may still do 50% implementation. But not all of it.

How is a Fractional CMO Different From a Consultant?

Often a fractional CMO is misunderstood as a consultant but there’s a difference. Before you choose for your company, consider these:

  • Do you need a broader marketing strategy or help with a specific marketing challenge?
  • Do you have the internal resources to execute the plan?
  • Are you looking for a long-term partner or a short-term solution?
Fractional CMO                                                                 Marketing Consultant
Require ongoing marketing leadership to hit your growth targets Have specific marketing challenges to be solved
They act as a part-time marketing leader, providing
strategic guidance and potentially assisting with the implementation
They offer project-based expertise, tackling a defined problem or campaign.
Need strategic expertise + longer-term support Lack of ownership of a deliverable but NOT team leadership
Demand marketing ownership & accountability over KPIs Need specific expertise to provide an outcome
Maybe a higher investment than a consultant Offers a more cost-effective solution for specific projects but no one-stop for all

What are the Challenges of Working With a CMO?

Early-stage startups face unique challenges when hiring a Fractional CMO. If you’re at an early stage then a CMO from a giant corporation might not be the best fit.

Their experience with large teams and budgets may not translate to your lean startup environment. You need someone who can not only craft a strategy but also get their hands dirty and help execute it. Don’t be fooled by marketers with expertise in just one or two marketing channels. Look for a well-rounded Fractional CMO with a broad marketing skill set.

Focus on a Fractional CMO with experience leading marketing at companies in a similar revenue stage as yours. These individuals will understand your specific challenges and limitations, allowing them to tailor their approach for maximum impact.

Responsibilities of Fractional CMO

A Fractional CMO should at least leverage their 10+ years of experience to develop digital marketing and product development strategies for organizations seeking growth.

They assist businesses in various stages, from startups to established companies, by guiding positioning, brand storytelling, and omnichannel marketing strategy development.

They achieve this by collaborating with internal teams or their team to execute various marketing tactics.

Most importantly, a fractional CMO should be able to understand the mindsets of the consumers and leverage them on online and offline platforms.

These tactics include

  • Content ideation to creation
  • Develop marketing strategies
  • Performance monitoring
  • SEO, online advertising
  • Social media management
  • Conversion rate optimization
  • Potential affiliate and partnership relationships
  • Product marketing & brand positioning

This Fractional CMO service offers two main solutions:

  • Acting as an outsourced CMO for B2B software companies and
  • As an outsourced marketing team to fill in marketing gaps for software companies

They differentiate themselves through their experience in tech marketing, knowledge of lead generation, and cost-effective approach.

Fractional CMO can go beyond and do stuff for you like:

1. Fractional CMO for B2B Software Companies:

  • Gain access to their expertise as a part-time CMO, guiding your B2B software company to achieve product-market fit and beyond.
  • Benefit from their structured approach with a proven 30-60-90 day plan to accelerate your marketing growth and foster a growth mindset within your team.
  • They limit their client load to ensure focused attention, with no more than 3 clients at a time.

2. Outsourced Marketing Team Support:

  • Address any marketing gaps within your software company by leveraging their team’s diverse skillset.
  • They can handle tasks like content creation, SEO optimization, online advertising campaigns, social media management, and conversion rate optimization, either on a retainer basis or as needed.

Here’s what a 20-year experienced Fractional CMO drew from her career.

“As a Fractional Chief Marketing Officer & Marketing Agency Owner, I have supported organizations and businesses in the growth stage looking for positioning help & support in gaining further market traction. I also serve as a marketing consultant to Start-up Founders through various Accelerator and Incubator programs, guiding them to develop their marketing strategy.”
Shannon (McDonald) Clement Fractional CMO, Space Tech & Aerospace Startups & Scale Ups

Why is a CMO a Better Fit for Growing Companies Than a Digital Marketing Manager?

Comparing a Digital Marketing Manager to a Chief Marketing Officer (CMO) in the context of growing companies involves understanding the scope of responsibilities and the strategic impact each role can bring. While a Digital Marketing Manager typically focuses on executing digital marketing tactics and managing online channels, a CMO is responsible for overseeing the entire marketing strategy, including digital initiatives, and aligning them with the company’s overall growth objectives.

Here’s why a CMO may be a better fit for growing companies:

  1. Holistic Strategy: A CMO brings a strategic vision to marketing efforts that encompasses both digital and traditional channels. This broader perspective allows for a more comprehensive approach to reaching target audiences and achieving growth objectives.
  2. Cross-Functional Leadership: As a member of the executive team, a CMO collaborates with other departments, such as sales, product development, and finance, to ensure that marketing initiatives are aligned with overall business goals. This cross-functional leadership is crucial for driving revenue growth and accelerating Annual Recurring Revenue (ARR).
  3. Market Insights and Innovation: CMOs are responsible for staying abreast of market trends, consumer behavior, and emerging technologies. This enables them to identify new opportunities for growth and innovation, whether it’s through exploring new channels, adopting cutting-edge marketing tools, or refining the product-market fit.
  4. Brand Building and Positioning: CMOs play a key role in shaping the company’s brand identity and positioning in the market. They develop strategies to differentiate the company from competitors, build brand awareness, and establish emotional connections with customers, which are essential for driving revenue growth over the long term.
  5. Strategic Partnerships and Alliances: CMOs often spearhead initiatives to form strategic partnerships and alliances with other companies or organizations. These collaborations can open up new distribution channels, expand market reach, and create mutually beneficial opportunities for revenue growth and customer acquisition.
  6. Metrics-Driven Decision Making: While digital managers focus on analyzing digital marketing metrics, CMOs take a broader view by evaluating the overall effectiveness of marketing campaigns and initiatives in driving revenue and achieving business objectives. This requires a deeper understanding of key performance indicators (KPIs) across multiple channels and the ability to make data-driven decisions to optimize marketing ROI.

What is an Offshore Fractional CMO? Can They Be a Good Bet for Early Stage Startups?

An offshore Fractional CMO (Chief Marketing Officer) is a marketing executive who works remotely, often located in a different country with a lower cost of living. They provide their expertise on a part-time basis, typically a set number of hours per week, instead of a full-time commitment.

Bringing in a full-time CMO can strain a startup’s budget. An offshore Fractional CMO offers the marketing leadership at a fraction of the cost.

This frees up valuable resources for early-stage companies to focus on product development and customer acquisition.

As witnessed, US-based startups are no longer limited by geography when seeking marketing leadership. Offshore Fractional CMO agencies house a network of seasoned executives with diverse industry expertise. This allows you to find the perfect CMO match for your specific B2B SaaS niche, even if they’re located overseas.

Fractional CMOs provide invaluable strategic direction, helping startups develop a winning marketing strategy and build a strong brand identity. The part-time nature of the engagement allows you to scale the CMO’s involvement as your needs evolve, ensuring a cost-effective approach throughout your growth journey.

By outsourcing some marketing tasks to an offshore Fractional CMO, your internal team can remain laser-focused on what they do best – building a world-class product and acquiring customers.

While communication can be a consideration, reputable offshore Fractional CMO agencies understand the importance of clear and consistent communication.

They often employ rigorous vetting processes to ensure their CMOs possess excellent communication skills and a strong understanding of working across time zones and potential cultural nuances.

When is the Right Time to Hire a Fractional CMO?

Saas companies go through different stages of development. It is not easy to say what exactly is the right time to bring fractional CMO into the organization. There are different stages when you think it is the right time, but in a strategic way for a longer run if you see it isn’t.

Here are different situations that you can consider:

  • Proper Utilization of Funds

Mostly, lean budget companies or early-stage startups use their funds wisely, in a way that it doesn’t get exhausted before they reach a certain goal. In such a way, hiring a fractional CMO is the most optimal solution instead of hiring a full-time CMO.

As we discussed in the beginning, a full-time CMO is an expensive deal. Having a fractional CMO you get a part-time experienced leader to guide the marketing strategies and at the same time you make the most of your budget.

  • To Remove Marketing Roadblocks

A Fractional CMO is capable of providing marketing strategies and plans that are tried and tested with different clients in different industries. Sometimes the internal expert cannot solve a critical problem that a fractional CMO can analyze and solve without heating the rest of the team members’ efforts.

Hiring a fractional CMO helps businesses with problem-solving, figuring out the problem, and hitting the right spot.

  • To Unlock New Opportunities

Sometimes the existing team cannot flourish with a set of available ideas and strategies. Having an external point of view helps to add an extra boost to the opportunity.

As fractional CMOs work with different clients, they are exposed to new technologies, marketing tools, hacks, and trends. Due to fractional CMO’s broad horizon, new opportunities are also expanded.

  • To Provide Niche Expertise

When launching new distribution channels, partnerships, or markets, companies need specific, niche talent. By hiring a fractional CMO with experience in that niche, businesses can capitalize on that expertise.

Generally, full-time employees are rarely exposed to another industry expert, but fractional CMOs are out there with different clients–they bring a whole lot of expertise to the table.

  • To Provide Economies Of Scale

Economies of scale can be accessed by companies by pooling resources with other clients since fractional CMOs usually work with a few companies at once. A partner marketing program can involve something as simple as joint media buys, the sharing of tools, or even the sharing of reports. Fractional CMOs can see how these opportunities connect businesses.

Challenges Of Hiring a Full-Time CMO: Does It Make Sense?

In the startup ecosystem, every time there’s news of a startup shutdown due to a money shortage problem investors are not funding anymore.

Hiring a Full-time CMO is a big commitment of funds. Before you invest in hiring a full-time CMO look under the carpet and see if it’s worth it.

It’s foremost to weigh the benefits against the challenges of bringing a full-time CMO on board.

Here’s something you should consider before making the decision.

1. Cost Factor

CMOs are very expensive. Their compensation packages can easily reach seven figures including base salary, bonuses tied to performance, stock options, and comprehensive benefits packages. Not just that, as a full-fledged company you need to bear the additional recruitment fees, onboarding costs, and potential relocation expenses (if any).

To look for a CMO, you need to onboard a head-hunting firm and these firms typically charge hefty fees, often a percentage of the CMO’s base salary.

For example, a $500,000 CMO salary might translate to a $25,000-$50,000 recruitment fee.

So unless your company is making an ARR of $10mm or more then only hiring a full-time CMO would be considerable. High-growth startups might prioritize rapid market expansion. In this scenario, a CMO’s strategic direction and expertise become particularly valuable. However, the upfront investment can be a strain on their limited resources

2. Culture Fit is a big question

Finding a CMO who aligns perfectly with your company culture and leadership style takes time and effort. A leader not only brings skill sets but also ownership and reflects a truth in culture.

A mismatch can lead to internal conflict and hinder progress. A CMO with a hierarchical leadership style might clash with a company built on collaboration and transparency. This can lead to frustration, resentment, and decreased team morale.

For example: If a CMO prefers to work as a solo-marketer and neglects the team efforts. This can delay important marketing initiatives and divert resources away from growth-focused activities.

3. Calculating Return on Investment can be complex

Marketing operates in a complex ecosystem. A customer might see a social media ad, read a blog post, and then receive an email before finally making a purchase. Attributing that sale solely to the final email interaction is a gross oversimplification.

  • Tracking a customer’s journey across various touchpoints (website visits, social media interactions, email clicks) is essential. However, existing marketing tools and methodologies often fall short of providing a clear picture.
  • Due to the long decision cycle, it gets difficult to pinpoint which marketing initiative ultimately influenced the customer’s decision, especially if it happened months ago.
  • Is the marketing team generating a higher volume of qualified leads, even if not all convert to sales immediately?

4. A Rhythm of Right Time, Right Person

Hiring a CMO before your business is truly ready can be a costly mistake. Planting the seeds before you onboard a full-time CMO is important. Check if your company has a solid marketing foundation in place.

CMOs don’t operate in a vacuum. They need a budget to execute their vision. This includes funds for advertising, content creation, marketing automation tools, and potentially additional team members. If your marketing budget is tight, a CMO’s grand plans might be grounded by financial limitations.

A successful CMO requires buy-in and support from leadership. Are your company’s key decision-makers aligned with the need for a CMO and prepared to empower them to make strategic marketing decisions? Without this alignment, internal conflicts can arise, hindering the CMO’s ability to make a positive impact.

Hiring a CMO too early can backfire. You’ll waste resources onboarding them without the infrastructure to support their work. Their frustration with limitations can lead to stalled growth and a demotivated team.

Hold off until your marketing foundation is built, your budget is robust, and leadership is on board. Look for signs of explosive growth and a clear need for a strategic marketing leader before making the move.

5 Things to Look for While Hiring a Fractional CMO

When looking for a fractional CMO, we at FirstPrincples recommend hiring someone who has led marketing teams at your revenue tranche ($1-5m, $5-10, $10-20m, etc). In companies with $20m ARR, the titles of these people typically include Head of Marketing or Vice President of Marketing and Growth.

Here are 5 important points you need to know:

  • Proven Results & Strategic Process: Look for a Fractional CMO with a track record of achieving similar results to your goals. If your business is innovative, assess its process for tackling challenges and capitalizing on opportunities.
  • Scrutinize Strategy & Metrics: Don’t settle for vague promises. Evaluate their proposed marketing strategy and the metrics they’ll use to track real-time progress. Measurable results are crucial for success.
  • Embrace Diversity: Consider candidates outside your industry or demographic. Fresh perspectives and innovative ideas from a Fractional CMO can lead to breakthroughs you might have missed.
  • Proactive Recruitment: Go beyond job postings. Showcase your brand and actively seek out potential candidates. Highlight why they should join your team. This targeted approach attracts top talent.
  • Skills, Communication & Cultural Fit: Assess their marketing expertise, communication skills, and cultural alignment. Look for someone with experience in similar businesses who can develop a plan to achieve your goals and seamlessly integrate with your team.

Your Fraction CMO is Right Here! ( Look for Agencies That Offer a Fractional CMO Model)

At FirstPrinciples Growth, we understand marketing is just one piece of the puzzle. Our Fractional CMOs are more than advisors; they’re strategic partners focused on building the foundational systems and processes that fuel long-term success.

We specialize in helping businesses of all sizes achieve sustainable growth by:

  • Building a Repeatable Marketing Machine: We don’t just execute campaigns; we help you develop a repeatable, scalable marketing system that consistently generates leads and drives revenue.
  • Optimizing Your Sales Funnel: We work with you to identify and eliminate bottlenecks in your sales funnel, ensuring a smooth path from prospect to paying customer.
  • Creating a Customer Flywheel: We help you establish a flywheel effect, where happy customers fuel further growth through referrals and repeat business.

By going beyond marketing tactics and focusing on building a sustainable growth engine, you unlock the potential for long-term success.

Our Fractional CMOs become an extension of your leadership team, guiding you toward achieving your full growth potential.

Contact us today to learn more about how we can help you build a thriving, sustainable business.

About Ameet Mehta

Ameet Mehta Ameet Mehta

Ameet Mehta‘s expertise lies in building revenue engines for technology-enabled companies and private equity investments. He began his journey with TechStars Chicago and has since founded and acquired several companies through FirstPrinciples Holding Company. The FirstPrinciples portfolio generates over $7M in revenue/year with most companies in the SaaS space. He...

About Ameet Mehta

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