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Science Of Marketing®

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Kuware Avi blog post CMO x
Nov 16, 2020

Is an Outsourced CMO the right choice for your business?

The Outsourced and fractional CFO(Chief Financial Officer) is well-understood models, but outsourced CMO (Chief Marketing Officer) still raises eyebrows. 

Marketing is a more intimate business activity, and CMOs and C-level executives are charted with setting the strategy and tone of Marketing. They define the complete brand and personality of the company. Can that be outsourced? Really? 

Seems a bit counterintuitive at first, right?   

Let’s consider the facts. The shortest-lived C-suite executive is a CMO? Why?

Marketing is still considered a soft skill but measured by numbers.  If the CMOs strategy and vision does not move the needle, he is out!

So why not outsource and hire for performance and fire without any guilt?

Now that I have got you at least considering an outsourced CMO, let’s look at things a bit more objectively.

What is a CMO expected to do traditionally?

The role of the CMO is to lead the overall marketing of an organization. He or she is also responsible for:

  • Marketing Strategy and Implementation 
  • Set and Manage KPIs
  • Aligning  Marketing with Sales
  • Develop, Manage Brand and Brand voice
  • Drive Product Planning, Pricing, and Messaging
  • Marketing Collateral for Sales Team
  • Lead Generation Strategy and Implementation

Why do CMOs have such short tenures?

The traditional arguments like poor cultural fit and personality incompatibility cannot be the cause because these apply to every position. 

Let’s face it; the number one reason CMOs get fired is a lack of measurable performance. 

It’s time for a table to break this comparison down between In-House Vs. Outsourced CMO logically, before we  get into detailed descriptions of each business challenge: 

  • Cost-expense of the employee to the company: Hiring and firing a full-time employee is an expensive proposition when considering insurance, taxes, and medical benefits. Especially at the executive level.   And if it does not work out, parting is not that simple and could negatively impact team morale. Outsourced CMOs can be cost-effective, and if it does not work out, firing is relatively painless. Finally, if your business is not ready for a full-time CMO, you could get substantial savings from a fractional outsourced CMO model.
  • Flexibility on duration and time: Leveraging a fractional CMO vs. an in-house CMO can be a wise choice when you don’t need a full-time person yet but are in a hurry to get going.
  • Diversity of thought, range of background: Outsourced contractors usually have a more diverse experience.  The Kuware model is a team of outsourced CMOs that makes this even more attractive as you get brain-share from multiple experts instead of one individual. 
  • The urgency to drive projects: If the project is time-sensitive and the marketing leader should have been on-board yesterday, then the outsourced model is the answer.  It is outsourced resources’ interest to drive for quick results and justify their existence.  The decision to hire a contractor is a lot faster and easier than hiring a full-time employee. 
  • Up to date on new technologies, tools, and channels: Contractors, by nature of their changing jobs and experience with multiple companies, are usually a lot more up-to-date on current technologies and trends. 
  • Efficiency and accountability: Contractors, outsourced resources are inherently more efficient with utilizing and tracking time. 
  • HR budget allocation vs. marketing budget vulnerability:  This a clear negative with outsourced CMOs; budget spend on a contractor is usually considered as part of the marketing spend and has to be frequently justified. At the same time, an in-house-CMO is HR spend and a lot easier to explain.  This disadvantage is only because of accounting practices and internal company politics in getting budgets approved.  On the other hand, outsourcing might be a better option from a cash flow point of view. 

Summary

The business environment is ever-changing, and adaption to this change is imperative. A modern CMO is responsible for keeping your business relevant as cultural and technology shifts occur across the industries. All while supporting product goals and sales. 

Leveraging a process-driven outsourced fractional Chief Marketing Officer whose only goal is to produce results at a fraction of the cost of hiring a full-time, C-suite executive can be the right move for some businesses at appropriate times.

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