The Fractional CMO Playbook

They don't advise, they actually own things. So, you said there, you know, what is it not? And four things that a CMO is not. Number one is they're not a consultant.

A consultant just makes recommendations and has very little attachment to the results. So, a CMO, however, decides and stays accountable for his decisions, right? So, when you come up with a strategy, when you come up with a program, you've got a vested interest to make it work and to make sure that lines up to business objectives. A consultant doesn't necessarily have that accountability.

They're also not a coach. We're not talking about jumping in a jacuzzi and feeling good for a short period of time, and then you get out of the jacuzzi and it's cold, right? That's what coaching does. A coach develops the person.

A CMO does a job, and it's a job that's attached to the organization's results, right? A CMO is also not an agency in a suit, right? The agency is executional. They should be getting the things done. The CMO directs the agency and makes sure that it aligns strategically with the organizational requirements, right? The CMO also is not just a part-time employee.

Employees need managing. CMOs should not need managing. So, if you're managing them, you've got the wrong person.

But the whole point is really getting access to the seniority that can help you run your organization. And you can't afford this full-time person with that senior title. So, you're actually in it for fractional hours, so you can afford what you need.

Make sense? So, John, go ahead. Make sense? It does make sense. But I'm just curious.

You said the word owns. And so, what's an example? What's a call that a fractional CMO would make that a consultant never would? A consultant can make some recommendations around systems, right? You need a marketing and tracking system. And maybe it's a CRM platform.

A consultant can come up, do a business analysis, and say, hey, this is the one that fits your organization best. You know what? You should be able to get some revenue tracking with this CRM. Whereas a CMO would not only come up with a recommendation for the platform, but they would ensure that the revenue is pulled out of the CRM and that the revenue lines up with business objectives in terms of growth, right? So, the CRM is just the tool.

It's not the job being complete. It's just a tool to be able to achieve the business objectives again. So, a CMO has more responsibility.

Excellent. That's usually something marketing people shirk away from, is accountability and responsibility. So, this is nice to hear.

That is exactly what the last episode was about and why CMOs should absolutely avoid that. They've got to take it on the chin. They own it.

Love it. So, who's actually ready for one? Give me the revenue band, the readiness test. How do we know? The honest answer here is almost everybody is ready.

A lot of people give guidelines, right? You've got to be this size of an organization. You've got to be doing this much revenue. In my opinion, there is no floor.

Everybody needs to think clearly about where their marketing dollars are going. You always need high-level thinking about your spend. You know, a $200,000 business or a $2 million business or a $20 million business all waste money in the same way.

They just do it with more or less zeros. And so, the real crux is that the smaller you are, the more every dollar you waste hurts. So, actually, smaller organizations need this advice and this level of thinking and strategic ownership even more than the larger organizations because those dollars are critical to their organization.

So, for me, the real question isn't, am I ready? It's, do I have the time not to have somebody in that role, both in respect of the owner's time to do the job, but also, you're slowing your growth. If you don't have somebody have expertise in that area, you know, the owner normally doesn't. And we're going to talk about that a little bit more.

But if you don't have that level of expertise, you're not growing at the rate that you potentially could. And you can't afford to do that. You can't have your business like growing at a slower rate than other businesses in the market, certainly in these times, right? Things are accelerating quickly.

So, you need that high-level thinking. If the owner is doing it, really, do you have the time and skill? I would say even owners that are good at marketing don't have the same level of experience of 20, 30-year pros. And do you have the time? Is that what you should be working on? A lot of times, you're up in the middle of the night running your Google campaigns, doing what you do, learning about other systems.

And it's exciting. It feels really good. But if you have somebody come in who knows exactly what they're doing for the right cost, then you get the hours that you need.

You get the growth that you need. And you can spend the time on growing the business in other ways. That's just an experience level.

Most owners don't actually have the time. So, they just do a poor job at it or don't do it at all. And really, you're not really too small.

You're just too busy to get somebody into the role and executing. And those are different problems with the same fix. You're not too small.

So, it's not a size test. There's a huge collective sigh of relief from 50% of our male audience out there. You go trying to be funny again, Ryan.

I'm not trying. It's the opposite word. I'll try and be smart.

It is not a size test. You just need to be able to pay the right amount to somebody with a lot of experience. Five hours a week or maybe even fewer than that.

Maybe even it's just a few hours a week with somebody with a bunch of experience will guide you in the right way and it's not going to break the bank. And you'll move forward quicker than if you didn't. Excellent.

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That's how it goes. That's right. So, John, getting back to it, what does a fractional CMO bring that an owner doesn't even realize they need? Yeah, this is the key here.

And this is the hardest thing in business, right? You don't know what you don't know. So the hardest gaps to see are the ones around the skills that you've never had. You don't miss them.

You just quietly underperform. It does its thing and you just call it normal and you're not even aware that you've got a problem. So there's a number of blind spots here.

Here are the skills that I think are super necessary as a CMO steps in. Number one, always number one, attribution. Knowing which dollar produces customers.

Owners genuinely don't know. They don't have the technical ability to choose the platforms correctly. They don't have the ability to wire it together so that you can actually measure attribution.

And attribution is complicated. So that's one. I'm not going to go down the attribution path right now.

Two, portfolio thinking around all your different channels that you're executing in. And you really need to treat it as an investment portfolio. You've got to feed the winners.

You've got to starve the losers. You can't just keep your budgets going thinking, oh, we're going to do a little bit of everything here and hope, right? The numbers generally tell you how it's performing. So treat it like an investment portfolio.

Getting your positioning right. And I'm talking about brand positioning, right? So why a customer picks you over the other guy? You need to think through that. You need to make sure it's on point.

That changes as your organization changes and as you're in business longer, right? Owners don't normally think, oh, I want to rebrand. They think it's expensive or they're just adjusting based on, you know, the competition based on price. It's rarely price that people choose between.

So making sure that your positioning is strong is another skill. And brand marketers are excellent at what they do. Next skill, pricing to margin.

So making sure that you're understanding that your pricing is on point, not necessarily what you think it's worth, not necessarily value based, nor what your competitor charges. You've got a price based around the volume that you sell and where you can make money. And it may be counterintuitive.

Like, do you want to be running 10 percent sales for the rest of your business time? Or do you want to be doubling the cost of your product, selling 50 percent of the number that you have to sell and still making as much money? That seems easier to me. You've got to sell less and you make more. So there's lots of different strategies to understand what your pricing should be.

But that's generally done by gut feel from owners. It's not done with market research and a strategy. And then also making sure that you allocate your budgets and your campaigns well.

You do the math around it. So how much should you spend? What do you have to hit to hit your growth number from each of the different channels? And you need to work backwards with that. Right.

So doing that, most people aren't aware that that's how you structure your marketing campaign. So another skill that that a lot of owners don't necessarily have. And they don't have the time.

They might have the skill, but they don't necessarily have the time to manage all the different vendors. Right. Hiring them, briefing them, firing them, getting agencies, getting freelancers, finding the gaps in their marketing programs to make sure that they actually perform.

So that's actually a skill or time based step that a lot of owners don't necessarily tackle and run very well. So owners generally have built their businesses on grit, good products, and it gets you to a ceiling. And those skills are what take you to the next level.

They take you to a different set of tools, different set of engagements. Right. So for me, lots of blind spots there.

The biggest one every time is attribution. If you don't know what's working, then every other decision really is just a guess. So attribution, portfolio thinking, positioning, pricing, the margin, budget allocation, that vendor management or what I like to remember it as is applicable.

Yeah, yeah, rolls off the tongue, is essential in every walk of life. So John, let's play marketing hunger games for a second. What does feeding the winners and starving the losers look like in real time, like a real budget? Right, so the first thing you got to do, and most CMOs will naturally evolve to this conversation as quickly as they get their feet under the table.

You've got to be able to measure, right? So if you've got advertising dollars being spent, it might be some in radio, some in TV, some in newspapers, some in digital, etc., etc. Some of those are notoriously difficult to measure. But as soon as you can get some measurement in there, how many eyeballs on things, what the cost per eyeball is, as soon as you understand how many people are coming in and converting into customers back to the attribution conversation, then you'll get a clear set of tactics that win.

And you'll get a clear set of tactics that you don't know what it does. If it does anything, then you're surprised by it. And there's a dollar amount that you're spending on those campaigns.

So you just got to cut them, like at least do a test and switch them off for a couple of weeks and transition the budget over to something else. And then look at your numbers. See if you get more gain out of it.

See if you get more leads and more revenue. So that's what starving the losers and feeding the winners looks like in real terms. Good stuff, John.

So let's say that the owner's got three candidates and a budget. How do they pick the right one and how do they set it up so it actually will work for them? Yeah, I think, let me give you three key questions. Obviously, you want to get into detail with each of them and you want to talk about their experience level.

But here are some questions that kind of differentiate people. Tell me about how you've assessed channels and what you've maintained and what you've killed and why. And I mean, this should separate the CMOs that have done it regularly.

Like I can reel off a dozen channels that I've killed this year, whereas consultants would generally just try and add more tactics in, right? They'll make a recommendation as opposed to as to, you know, have some real ownership there. How do you, second question, how do you tie in campaigns to dollars in my P&L? And if they start the conversation around, well, I'm not really sure. And, you know, there's a number of impressions.

Here's a number of leads we get and we'll track, we'll track, we'll track leads. Then, you know, next, that's not really the conversation you want. If they start talking about systems that follows leads all the way through to completion to be able to track revenue and customer lifetime value, then that's a really healthy conversation about what marketing is going to do for your P&L.

And that's a person that really understands how marketing can affect your P&L. I like I'd like an answer like that. I think there's some managing up things as well.

I think you can ask them a question like, will you tell me what I don't want to hear? You know, or, you know, what are subjects that you'll tell me that I don't want to hear? Because if they can't answer that, if they don't have specific examples, then they're not really at that level to manage you as the owner, because there's going to be some difficult questions here. Like you need you need to peel the onion back at so many on so many different things. And there's just got to be honest candor in in the conversations to understand what doesn't doesn't work and what's important to you and what's important to them.

Hash things out, you know, all in a way that supports the business. But those are some difficult questions sometimes. You know, hey, they may come up to you and say, hey, I hate your brand.

You need to rebrand. And that's deeply personal. Right.

So those are some difficult conversations that you have. So, yeah, those are three questions, I think, that help. I think you want to have a look at their cost, like how much are they going to charge? Fractional can be anywhere from, I don't know, four to five thousand up to twelve thousand a month, like twelve thousand a month is getting up towards full time sort of level like you're you're you can afford quite a chunk of a person's time for that.

The lower end really is, you know, you're you're getting a fraction of a person's week. If you're getting below that, you're generally getting a manager or coordinator who's just executing with a bit of a flavor around how to direct your business. It's not really that that C-suite accountability that you're after.

So, yeah, I'd have a look at exactly what they're charging and what it includes. I'd look at how they structure the the engagement as well. I'm going to sit on the CMO side here and say, look, I think you should have a minimum six month engagement.

You know, a lot of people like to go with three months, but I think it's so difficult to turn the ship sometimes that certainly a month or two is really quick to be able to to create some some change. Six months is a good trial period where you can actually turn the ship substantially. And it takes time to build some systems to give you results for them to be able to make some decisions as well.

Right. You need some weekly, weekly cadence with the team, weekly leadership meetings. Obviously needs to report to the owner, the CMO, CMO, sorry, CEO, not the sales or anybody.

You can't bury them in the organization because you need a direct line of sight to exactly what they're doing. I think you could set up with a 30 day trial audit on all the things that your business does. And that's a good way of engaging and not committing to that sort of six month term.

Make sure that you like the cut of their jib, that they the way they communicate and that they really they dig into the detail required. I would kind of start around there. An important point is a point as well as you've got to be prepared to give them budget authority.

Right. They should be asking for how much, how many dollars they need to be able to move the organization from X to Y. If you don't freely give them that authority and the ability to make change within it, then honestly, don't bother. Right.

Because you've got to give somebody, they've got to run their own department and be able to create, you can oversee it, but they've got to create this change and you can't be sitting there like tying the purse strings and they shouldn't have to come back to you every time every time they need a dollar to do something else. So otherwise, you're really just strangling them and you've got an expensive suggestion box. So, yeah, put a 30 days mutual exit in the contract.

The good ones won't fear it. The bad ones will argue about it. Those are my tips for hiring.

So, John, we live, a lot of us live in 90 day worlds. Why six months? You alluded to a little bit, but can you go into a little bit detail like what breaks that 90 days or why can't we get there in 90 days? Yeah. And I mean, it kind of depends on the stage you're at.

Right. It depends on what you're trying to achieve as well. A lot of the time people engage with a CMO when they're trying to make a big business decision to make and make some pivots or grow something out.

Right. And so say you want to expand a business unit. Right.

You want to double sales in that business unit. The first thing a CMO is going to do, and I think we're going to dig in a little bit on how to engage in what they what they what they do throughout the engagement. The first thing they're going to want to do is try and understand results and accountability for current programs.

And they're going to have a chat. They're going to look through all the data. They're going to find stuff missing, missing.

They're going to go to the agency or the internal person who's running campaigns. They need these other data points. Like it can take four to six weeks to get more data points built into reports.

Right. You know, just the way some of these things work. Right.

So you spend the first month like analyzing and understanding what you need. Then you then you spend a month or two getting what you need. Then you start making decisions about what you cut and what you start starve.

And suddenly you're at three months and you haven't really done anything where the additional business unit growth is starting to bear fruit. You know, you then start making some decisions. You say, OK, we're going to move these channels.

We're going to do this. You have some operational things that you need to discuss. Maybe you have a capacity issue and you need to change some things up.

And suddenly you're four months in and things start to happen around. Perhaps they start to happen around then. So you need a couple of months more for them to bet in and show actual change.

So we're steering a big ship here a lot of the time. You know, I don't just want to throw six months out there and say it's this hard, fast rule. But you know what? If you're doing something more simple and straightforward, yes, perhaps you see some results in 90 days.

But if you're steering a big ship, if you're pivoting, if you're looking at a different model of executing, then you need some time to be able to create the change. And when they're getting their feet under the table, they're really looking at systems that might need to be built before they can even start making some decisions. So a little bit of leeway, I think, is helpful.

And I think the takeaway from that, too, is you've got to vet very carefully because there, you know, you don't want a lot of attrition in that because programs need time to grow. Yeah. And you can be six months in if they're not any good.

And you're like, oh, well, holy crap, we need to start again with a new person. And that affects your business model. So I really like the thought of that 30 day audit time.

Come and audit our business for 30 days. And that's a paid audit. They get some money for it.

They should be open to that. And then it really gives you some more information about making a decision for the long term. Audits are always fun, folks, even from the IRS.

It can be a lot of fun. Yeah, it's like an anal probe. He went there.

Yeah. All right. Time for another break.

Quick break. Trimmers Landscaping, Londonderry, New Hampshire. And the tie here is design and build.

You don't hire a landscaper to mow. You hire them to design the whole yard and then build it. That's a fractional CMO for your marketing.

Strategy plus execution. Not just cutting the grass. Trimmers does patios, walkways, retaining walls, granite steps, plantings, the full design build.

As a Canadian, I will say they also do snow and ice management, which is the only part of this I'm truly qualified to evaluate. That's your one. That is my one Canadian reference.

30 years residential and commercial. They'll design it, build it and maintain it. One team, one plan.

Which is the whole fractional CMO pitch. One person owning the plan end to end. Trimmers Landscaping.

603-882-8888. TrimmersLandscaping.com, Londonderry, New Hampshire. Why do I always get to do the numbers and the web addresses? You never have to do the web addresses.

You just say it so well. You're so much better than I am in every aspect. You're more handsome.

You're taller. You have more kids. More bills.

Yes. Yes. And more hate mail.

Yeah. Oh, yeah. God, some people hate you so bad.

Half of them are my relatives. All right, John. So good stuff.

Now we're going to get into it. Right. So take me under the hood.

What's the engine look like when a fractional CMO first steps in? You know, what do they evaluate? And then what's the ongoing rhythm from there? OK, so, yeah. Step one, this initial evaluation. Before changing anything, assess.

Right. Nobody should be rewiring the engine like as soon as day one. That doesn't make sense.

And the key thing is the financial aspect. Right. We alluded to this last week.

Taking a look at the P&Ls, understanding what the business objective is, running the numbers through on feasibility for growth targets for the year. Right. So let's really get at that business growth angle and understand, do the numbers add up? Because if you've got to find a thousand customers on a $2,000 budget, that's not feasible.

You're not going to do that, especially in the digital world. Right. So they should be able to punch the numbers.

They should be able to tell you almost off the top of your head whether something is realistic or not. They then really should start to get their head around CAC, the cost per acquired client. Right.

They should start trying to do calculations around margin per customer and then looking at those ideally by channel and understanding what the spend is and what they think they get from each individual channel. Nobody usually has these all clean and set up. And I think if you do, that's great.

You've done a lot of the blocking and tackling necessary for people to come in and make decisions right away. That's great. But a lot of times those things need to get cleaned up before somebody can start making an informed decision about really how to roll out, how to create some additional strategy.

They'll look at measurement. You know, what's actually tracked. Is it all platform reported vanity? Is it tracking things through on CRM systems to actual revenue dollars and, you know, job scheduling systems, et cetera, et cetera.

They look at where the money's going, whether they've got direct access into the platforms. They'll have a chat with the agencies as well. They'll have a look at the positioning of the business.

And, you know, as I said before, with brand positioning, they want to understand what the market thinks of them as well. There might be some brand awareness studies that they'd recommend. Those are a little bit difficult and sometimes expensive, but they're super useful.

And they want to talk to teams and vendors, like who is executing? What are they doing? They should be able to make some judgment calls of whether they're good or not. And, you know, perhaps it goes back to some of the agency grading stuff that we talked about last week as well. Usually, you know, owners are just kind of letting, owners and existing senior leadership are just letting the kind of campaigns run, getting performance reports sent through that they don't totally understand.

And like right away looking at those reports, I know whether it's BS, whether it's useful or not. I can tell you right away whether, you know, the campaigns are actually doing what you're hoping. So yeah, that's the first step, really.

Initial evaluation, diagnosing things. It takes a couple of few weeks. If people are changing things right away, then they're guessing.

And that's the last thing you need is somebody coming in and guessing. Step two, creating a bit of a loop, right? Because they just baselined all the performance and then they want to set up their rhythms with upwards and downwards. They want to review the numbers week one, understand CAC, ROAS, et cetera, pipeline close rates, things like that.

Week two, they should be able to make some feeding and starving decisions. Hopefully, if the numbers, you know, come through, they should be setting up members, you know, with the leadership teams. So you have your weekly L10s like we do on upwards into the C-suite.

They should be setting up marketing L10s with their department to make sure that they've got everybody, all the stakeholders within the marketing department in discussions. They should be able to collectively make some of those decisions I just mentioned on reviewing the numbers, feed and starve, et cetera, et cetera. They should be having all the conversations with freelancers agencies as well.