Marketing is increasingly complicated as businesses compete for buyer’s attention across multiple channels. The speed of change and advancements in the technology required to maintain a strong marketing presence have, elevated the importance of having an actionable marketing strategy. Companies seeking to grow look to marketers to help increase brand awareness with potential customers and drive new leads to their sales teams. But as many business owners know, marketing is complicated and expensive. Purchasing marketing services from vendors or agencies without a strategic plan can often lead to disappointing results. While hiring a junior-level marketing team can bring some of those expenses in-house, companies risk sacrificing time and money developing employees with the needed skills and expertise. A Virtual CMO might be the answer!
Approaches to Marketing
Traditionally, there have been two main ways for small businesses to approach marketing. They could either outsource most of their marketing efforts to agencies or take on the challenges in-house to design and execute a strategy. Outsourcing can produce reliable results but often comes at an extremely high cost. And usually, marketing decisions are made based on budget, not because they are what's best for the business. On the other hand, tackling marketing internally has its challenges. The organization might not be large enough to justify the cost of a senior-level marketing executive or building out a marketing team. The temptation is to assign marketing responsibilities to other managers as part of their job or hire junior level employees with limited skills and experience. It's not uncommon to see titles like Vice President of Sales and Marketing in many small and midsize businesses. The challenge is that marketing is the company's engine for growth. Failure to build out and execute a strategic marketing plan limits growth and puts increased pressure on Sales to find leads when they should be selling.
There is, however, a third option that many companies are evaluating today — hiring a Virtual Chief Marketing Officer (CMO) or CMO On Demand. The idea is simple. Rather than hiring a full-time executive responsible for marketing, an outsourced CMO is a contract employee who devotes a percentage of their time to a company. They help build out a strategic marketing plan and then coordinate the execution of marketing programs. They do this by managing internal resources or helping to engage appropriate vendors to complete program deliverables. This leverages their experience, connections, and expertise at a lower cost than either a full-time hire or outsourcing to an agency.
What is a Chief Marketing Officer (CMO)?
A CMO (Chief Marketing Officer) develops a marketing strategy aligned with a company’s overall goals and objectives. They work closely with the management team to understand where the company is headed and works to create a marketing plan focused on increasing brand awareness and generating new leads for Sales. The CMO manages a team of internal and external resources to execute the overall marketing strategy. As an executive leader, the CMO typically holds degrees in business or marketing. They have a breadth of roles and responsibilities to support the company's mission, including:
- Developing a brand awareness strategy to increase the visibility of a company's products and services in the marketplace
- Researching and assessing the marketplace competition, product-market fit and target customer personas
- Collaborating with sales to turn marketing insights and leads into sales
- Directing the company's public relations, communications and analyst relations effort
Not All Businesses Have a Chief Marketing Officer
It's important to note in this discussion that not all businesses have the executive role of Chief Marketing Officer. This is especially true of small and midsize companies. In those firms, they might have a VP of Marketing, Director of Marketing or even a Marketing Manager. The title really doesn't matter. The concept of a Virtual CMO is an experienced marketing manager who can help create a comprehensive strategy and manage its execution. No matter what title may or may not exist within your organization, if you're looking to grow, chances are you'll find significant value and should contemplate the decision to hire a Virtual CMO for your business.
What Does It Cost to Hire CMO?
When a company seeks to grow, a CMO can design a strategy to produce top-line results with marketing efforts. He can raise brand awareness, increase lead conversions, and improve customer loyalty leading to increased sales. According to PayScale, the median compensation for a CMO in the United States is $170,000. With benefits, bonuses, and incentives, the cost of hiring a full-time CMO on average is well over $200,000 a year.
Often, businesses are reluctant to spend this kind of money on marketing, believing that money should be spent on sales resources. They hire a VP of Sales and Marketing, choosing to give marketing responsibilities over to the sales leader. Unfortunately, sales and marketing are vastly different skill sets. Sales leaders are often incentivized for short-term results and meeting monthly or quarterly sales quotas. They focus on the “low hanging fruit” at the expense of developing a more robust pipeline. Once the near term deals are closed, they often find themselves suffering from a drought of new leads and spend money on "quick-fix" marketing programs that rarely deliver sustainable results. In business, this is an all too common scenario and can stall a company's growth or worse.
Developing a marketing strategy that can build a lead generation engine is essential for a company's long-term growth. Having consistent leads and building awareness in the marketplace is critical to support sales and keep a steady flow of new business opportunities. But marketing programs take time, and building awareness doesn't happen overnight. When companies invest in a marketing strategy aligned with their growth objectives, sales will benefit from having a predictable stream of leads. This strategy is where having an experienced CMO is essential and why it's crucial to have an executive leader who understands how to create programs to support sales activity. So if businesses are reluctant to spend money on hiring a CMO and giving marketing responsibilities to a VP of Sales isn’t the answer, a Virtual CMO might be the solution.
A New Trend for Businesses: Hire a Virtual CMO
There is a rising trend now of hiring a Virtual CMO. A contract executive is a solution for small and midsized businesses that cannot afford to pay a full-time CMO. The decision to hire a Virtual CMO is like adding a seasoned executive on your team but for 30-80% less than the cost of a traditional full-time hire. They help businesses build marketing strategies to grow and then manage the execution of the marketing programs. The Virtual CMO offers insight and guidance to your management team while remaining unbiased and focused on marketing. They also have broad access to a network of resources that can help execute marketing strategies without having to hire more internal marketing resources.
What Will a Virtual CMO Do?
A Virtual CMO is someone who can help uncover your business goals. Once discovered, he designs a strategy with the programs and campaigns needed to achieve the company's overall goals and objectives. Once the plan is in place, the Virtual CMO can manage the execution – all without having to hire and manage full-time staff.
- Works with you at an executive level to understand the company’s goals and objectives, target customers, and product-market fit.
- Brings a fresh perspective and critical analysis to understand your marketing opportunity. He can tell where you stand today, how to differentiate your offerings, and what it will take to achieve your goals by building a detailed marketing strategy. This strategy has specific action items that will drive revenue growth and increase brand awareness in the marketplace. It will include both inbound and outbound marketing efforts.
- Develops critical monitoring and measurement dashboards. This is to ensure that every aspect of your business is working on the plan and improving.
- Recommends critical technologies and automation platforms that can improve the execution of marketing programs, lead flow to sales, and the measurement of key metrics.
Is the Decision to Hire a Virtual CMO Right for Your Business?
Experience Without the Expense - When it comes to hiring an executive-level leader, there will be a commensurate salary based on that person’s experience. This can be a significant burden for growing businesses. It may also be challenging to justify the need for a full-time CMO at the current stage of your company's growth. By outsourcing your CMO, you can contract this expertise as-needed. Think of it as an "executive-on-demand” service. You get the talent you need at a price you can afford. This can save you a significant amount in salary and allow you to invest more in your marketing programs. Outsourcing high-level positions can save your business 40–65%, according to some estimates.
Expertise in Marketing Execution - Depending on the size of the company, the job of the marketing leader is a significant undertaking for any one person. What often happens is companies hire a “jack of all trades,” but who turns out to be “master of none.” Or they hire a team of junior-level people who are knowledgeable about one or two areas but may be lacking in other experience. An experienced CMO has the resources and connections to bring the right team of experts together to execute the marketing plan. They bring with them years of experience that they can leverage to grow your business working with both internal resources and external experts.
Avoid the Pain of Recruiting - Hiring a new employee is expensive and time-consuming. You have to post the job, sift through resumes, and go through the lengthy interview process. The hiring process could take months while you search for the right candidate. A Virtual CMO is an experienced executive already working with companies to build and execute their marketing strategies. Since they are a contract hire, you'll quickly be able to see how they work with your team and integrate into your decision-making processes. Getting a Virtual CMO onboard can happen quickly once you’re comfortable with their experience and management style. As soon as the contract is signed, they can often get started in a matter of days. No onboarding, HR, or benefits conversations.; your new contract executive can simply get to work on your behalf.
Start Quickly - There's always a learning curve whenever someone new joins a business and that's true for a Virtual CMO as well. In the beginning, they will need to get to know your business strategy, products, and services. But a Virtual CMO uses their extensive experience with other businesses to quickly recognize your business needs and how a marketing strategy can help deliver measurable results. As a contract employee, they will be eager to prove their worth as quickly as possible.
Scale Your Marketing - A Virtual CMO works with businesses of all shapes and sizes, but their background is essential. While marketing tactics are similar across industries, there is a significant difference between business to business (B2B) and business to consumer (B2C) marketing. Often times, B2B marketing has a stronger relationship management component where B2C tends to be more transactional. A Virtual CMO will be well-equipped to get you to the next level, but their experience marketing to other businesses or consumers is essential to note. We’re not saying all CMO’s don’t have relevant experience, but finding one who has experience reaching your type of customer is often helpful. It’s similar to hiring a salesperson. While it's difficult to find people with previous experience selling products just like yours, if they understand how to sell to your type of customer, they will quickly adapt to selling your specific products or services. The same is true for a marketing professional. Marketing tactics are similar from industry to industry, but the specific needs of your customers are what make each marketing strategy unique. An excellent Virtual CMO will be able to apply their experience to the individual needs of your target customers.
Accountability Through Contract - When you contract with a Virtual CMO, you know exactly the scope of their efforts and how much time they're spending working for your company. Typically, Virtual CMO’s work on an initial 6-month contract, which specifies the approximate number of hours they will be working and what deliverables you should expect. Keep in mind, this is not an hourly position, just as it wouldn’t be for other salaried, executive roles. A rough approximation of the hours you'll receive can be helpful, but a good rule of thumb for typical contracts is about 20 hours per month. It’s important to remember that the Virtual CMO helps build out a strategy, and then project manages the execution. The day to day work will be done with your existing marketing team, if you have one, or recommend vendors, who are experts in specific marketing areas.
There may be times when you bring in a Virtual CMO for a specific project such as launching a new product, designing an awareness campaign, or entering a new market. Sometimes a Virtual CMO provides a bridge between a junior level team and bringing on a full-time executive hire. Whatever the specific needs, you’ll get the most value from a Virtual CMO by involving them in your management strategy sessions and having them work with other executives to synchronize marketing strategy with other aspects of the business.
Connections and Access to Reliable Vendors and Technology - A new CMO will help evaluate your current marketing infrastructure and help determine if you might need to bring on more resources to execute the marketing plan. This infrastructure includes things like a marketing automation platform or content management system. These tools and resources can help your company build a solid foundation for growth and success. A Virtual CMO can help you evaluate your current capabilities and where enhancements or additions might be needed to increase your marketing and sales effectiveness. Their experience helping other companies can save you time and money by steering you towards the best and most cost-effective resources for your business needs.
Hire a Virtual CMO
Is an outsourced CMO right for your business?
Hiring a full-time marketing executive can be expensive but leaving your business without a reliable source of leads could lead to revenue shortfalls. The decision to hire a Virtual CMO provides an option that offers the experience and expertise your business needs. An outsourced CMO provides a cost-effective way to quickly enhance your marketing efforts while achieving growth objectives faster.
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