How Much Does a Fractional CMO Cost?
I’ve been promoting my services as “Getting the experience of a CMO at a fraction of the cost.” But not all Chief Marketing Officers receive the same salary, so using a good one might be more affordable than you think.
The truth is that it all depends on a few factors, which I will list below. However a little secret I want to let my friends know is that the one thing you don’t want to do (agree to a retainer) is the one thing you actually should do. Here’s why: the most value a Fractional CMO or consultant can offer your business is pro-actively looking out for you. Finding the things you cannot find because you are either running a business or you are not trained as a marketer.
Most business owners know enough to be dangerous. They know they need sales. They know they need a logo. They know they want to do advertising and email marketing. And some of them know what they are doing or know enough to hire someone who does. Reading a few blog posts about ChatGPT is not a marketing strategy.
Think about marketing tactics as if they were ingredients for baking. You’re putting the egg, flour, sugar and vanilla into the over, but it’s not coming out right. Clearly baking doesn’t work for your company. Wrong! That’s not baking! That’s throwing a bunch of ingredients into an incinerator. Burn baby burn! Recipe. For. Disaster.
You Don’t Know What You Don’t Know
When I started at one national company that had been around for nearly 14 years I was shocked to learn that they didn’t have a central document for marketing messaging - a core place to reference their tag lines, slogans, unique value propositions, etc. Even if they changed, there should should be at least one folder with this copy in it. So when the CEO, who was also head of product development want to launch a new service, I took it as an opportunity to write a one-page press release. This document would literally serve to get us all on the same page.
I used the boilerplate I wrote on the release to sync up with the About Us section of the website. And I used the succinct company description in the first paragraph to craft a tagline for our business cards. It wasn’t much, but it was a good place to start. When you have leadership who like to edit everything the marketing team does, imagine what a pain it is to go through rounds and rounds of edits in multiple places. By going through those rounds of edits with just the one document, just the press release, I was able to extract language, tone and style preferences that could be used in other places.
Too often, companies will ask their agency or consultant for the press release and not realize. they need an entire folder of consistent, coherent marketing messaging that echoes across the website, emails, social channels and beyond. You get my point. Signing a retainer allows the marketing expert the freedom from hourly projects that they need in order to find these improvements. At least, that’s how I operate. Agreeing to a monthly retainer does not turn me into a “vending machine” of marketing tactics. Company can use Fivvr for that.
Factors Determining Cost:
Type of project - the time needed to oversee the launch of a new B2C app for global adoption is more expensive than the time needed to deploy weekly marketing emails.
The experience needed - global consumer brand marketing is multi-layered and complicated, not to mention stressful on delivering results. Heavy IT B2B marketing requires a deep knowledge base of the subject, and many marketers in this fields started out as programmers and became popular copywriters.
Tools needed to execute - We’re not just talking software here. Sometimes events are needed to accomplish marketing goals. Fractional CMOs or marketing consultants worth their salt will disclose what tools are needed and how much they cost.
NOTICE: I didn’t list the size of the company among the factors. Small businesses often ask for great things without having the budget to fund them and then expecting a miracle. No dice. Be real. Please.
Ways To Structure Cost:
Monthly Retainer - This is the best way to start out. Why? Because it frees up the marketing person to do what they do best. Look for opportunities without watching the clock. Inspiration comes at odd hours. If you’re not pro-actively hearing from your Fractional CMO, you might want to find a new one unless you have a very specific other arrangement.
Hourly Rate - This is a trick. If the marketing person sets their rate low in order to win the work, they will likely feel like they need to add more hours to make up for the loss they actually deserve. Also, this rate DOES NOT APPLY TO TASKS. Hourly rates should be used for consultation calls, training teams, and calling into meetings.
Project Basis - On a limited budget? This might be the perfect solution for you. It’s a win-win if you can stay within your budget and the marketing professional feels like they are getting paid their worth. They know how well and how quickly they can turnaround a project and you know what your budget is. Finding a match here might be tough but worth it.
HINT: Most Fractional CMOs will build in additional suggested services in their proposal. These items might be above and beyond what was asked for, but this allows for two things: one, these extras can likely be cut if the estimate is too high; and two, it allows you to see what you didn’t know to ask for but should keep in mind for later if it gets cut off the front end.
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