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Are fractional CMOs the marketing world's latest fad?

Are fractional CMOs the marketing world's latest fad?

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Fractional CMO is a term that is quickly gaining traction in the marketing world. In fact, MARKETING-INTERACTIVE recently published news about a collective of chief marketing officers (CMOs) coming together to launch Fractional, a new operator model with the goal of solving the marketing leadership gap in hypergrowth companies.

Don't miss: This new firm by CMOs aims to solve marketing leadership gaps in hypergrowth companies

Fractional was founded by three Southeast Asia-based marketing leaders who have more than five decades of combined experience, and worked with the likes of Grab, Uber, Sequoia, Mars, Dell, Zynga, PayPal, Antler and Cove, said the release.

So, what is a fractional CMO? Simply put, a fractional CMO, or FCMO, is an outsourced role where an organisation hires an external expert to helm the role of the CMO without having to commit to the cost of a full-time one.

Simply put, a FCMO is akin to a 'CMO on-demand'.

And while the term might be gaining prominence now, it isn’t exactly new. Industry recruiter Jimmy Yar, founder of the Talent Detective says that the trend has been evident for the past few years and goes by a variety of titles such as “on demand CMO”, “marketing consultant” or “stand-in CMO” and the likes.

Typically, the roles tend to be held by seasoned marketeers who are planning to hang up their corporate boots, but who have a continued desire to be in the marketing practice without the rigidity of a corporate setting.

Agreeing with Yar, practicing FMCO, Yvonne Low, who previously worked with organisations such as OCBC and McDonald’s, said that the trend came about as the pandemic reshaped many facets of work. Post pandemic, the world saw a higher acceptance of hybrid work arrangements, and the rapid deployment of digital transformations to enhance business productivity. Overall, there was also a shift in organisational mindsets around adopting a 'freelance hire' model at the C-suite level.

“At its core, FCMOs embody the expertise of a seasoned marketing executive, bringing a wealth of experience, industry knowledge, and leadership acumen to the organisation, but operates on a part-time or project-based basis,” said Low. This model provides companies with the flexibility to access top-tier strategic marketing guidance without the financial commitment of a full-time executive.

Can the role be truly effective?

For a fractional CMO to be truly effective in their role and the tasks they are hired to undertake, a high level of trust and collaboration must be established between the company and the FCMO. This however is easier said than done as many companies hold data and insight close to their chests and are unwilling to give external parties a complete overview.

To counter this problem Low said a clear establishment needs to be ironed out so that the FMCO is able to extract valuable insights and make informed decisions to assist them in driving marketing strategies and business growth.

“When I was hired as an FCMO with a retail company, it was established from the outset with the CEO that I would work closely with the team to analyse data on customer segments, product offerings, consumer buying behaviour, and detailed market reports,” she said.

Therefore, companies seeking to hire an FCMO should be prepared to establish a high level of trust and collaboration with the FCMO.

To address concerns about sharing sensitive data, robust confidentiality agreements and stringent data security protocols should be implemented to ensure that critical data and information remain protected.

Low added that the suitability of hiring an FCMO varies depending on the unique needs and circumstances of each company. However, certain types of businesses can particularly benefit from this model are startups and small to medium-sized enterprises that often lack the resources to afford a full-time CMO but require strategic marketing expertise to navigate competitive markets and scale their operations.

Additionally, established companies grappling with specific marketing challenges or undergoing transitional phases can leverage the FCMO to inject fresh perspectives to drive growth and business innovation.

But not everyone is as optimistic. Goh Shu Fen, principal and founder of consultancy R3, argues that this might be just another trend that seems to pop up every time a high-profile CMO role gets restructured or not replaced amid economic uncertainty or an anticipated slowdown.

“It wasn't that long ago that we faced the biggest uncertainty and crisis ever, yet most CMOs kept their job. Why? Because a CEO who is serious about customer-centric growth beyond the current financial year will need someone who can identify and connect the dots between the gaps and opportunities, both internally and externally,” she said.

She added that at the end of the day, every organisation needs someone who is able to view problems through the customer's lens- which is the job of the CMO. She said:

The role of a chief marketing officer cannot be a part-time position if a company is serious about marketing as a growth driver.

A CMO needs to be able to own all the key domains surrounding the customer in order to be successful in this day and age, and be the key driver of growth, added on Yar.

And while the role works for some, not all organisations are geared for the CMO to be able to own the whole customer experience. “But increasingly we are seeing more organisations doing that with the widening remit that the CMO is being expected to hone,” he said.

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