There is a growing trend for mid-market CEOs to outsource the role of the CMO. A survey by consultants Booz, Allen, Hamiliton found that fewer than 50 percent of Fortune 1000 firms employed full time CMOs. The fractional CMO is on the rise.
A full time CMO is an active, strategic voice within the executive team. A fractional CMO is a hired gun brought in to work on a specific issue.
As consultants, Fractional CMOs now compete with the specialist marketing consultants they used to collaborate with when they had a full time gig on an executive team. In mid-market firms, the shift is now weighted to short-term tactical expertise rather than long-term strategic leadership.
The trend in mid market companies continues to favor the fractional CMO. Marketing over the last decade has been commoditized by data and analytics, which is ubiquitous and made insightful by the very people who create data.
The role of the Chief Marketing Officer has always been the most difficult role within the C-Suite. The skills, talents, requirements and expectations to be a successful CMO have changed significantly in the last decade. What hasn’t changed is the short tenure of the CMO executive in most organizations. I’ve read the average tenure of a CMO is now a bit south of 36 months.
Typically, CEOs are data/finance driven human beings. They are quantitative in nature. For a CEO leading a mid market company, it makes economic sense then to out source a role they believe is intervention-based, rather than future-vision based. There are many reasons for this, none the least of which is the continued demand of CEOs to insist their marketing leaders achieve more with less.
And that has led to the rise of the fractional CMO.
I’ve never been a CMO, but I have collaborated with hundreds of them in diverse industries over my career. Without question, a fractional CMO can provide great value to their CEO clients across the full marketing ecosystem. For many organizations, a fractional CMO is an efficient alternative.
However, in my experience, a full time CMO makes a more important contribution to long-term strategy development than the fractional CMO in a short-term tactical consulting role.
The CMO brings a consistent understanding of markets and customers that can help the management team make decisions about which markets or segments to enter, which products to develop and which companies to approach as strategic partners. This insight is important for the leadership team making complex decisions about competitive markets where change occurs quickly.
The presence of a CMO on your top management team with full operational authority can build a better understanding of the contribution of marketing activities to revenue and profit. When the CMO is accountable for this bottom line responsibility, other members of the top management team will recognize its importance and allocate necessary resources to ensure marketing success over the long term.
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